Producing Poinsettias Profitably
"You may not make any money on poin-settias, but you sure can lose a lot," was my comment to a grower recently as we were discussing measures he was taking to cut costs. In the current big box market, a grower cannot afford to put a lot of extra costs into poinsettias, but you also cannot afford to take too many risks. With a crop like poinsettias, there are certain aspects of production you cannot skimp on or the effects will be seen in reduced plant quality. At some point, the buyer is not happy and sell through is affected.
With the big box stores, sell through is becoming a bigger issue. There are steps growers can take to influence sell through. They generally are not cheap and have to be well calculated. Improving the retail display is obvious. We have all seen poorly displayed product. It would be best to not display poinsettias on racks, but in many cases, it cannot be avoided. In these situations, putting fewer plants on the rack and dressing it up would make a much more appealing presentation to the customer.
Looking At The Markets
The strength of the poinsettia markets last fall was highly varied around the country. Wal-Mart in many areas was particularly good due to its strong in-store poinsettia placement. Larger containers continued to be strong and grow. Stores like Costco also seemed to do well. Demand for 4-inch pots seemed soft, and several growers are talking about greatly reduced numbers for 2007. One trend in 2006 that will definitely continue this year is reduced production numbers for growers supplying Home Depot. A natural effect of the pay by scan program is that there will be less shrink at the store. In the short run, sales will not increase very much, so the grower does not need to produce as many plants. Hypothetically, if a grower reduces in-store shrink from 20 percent to 10 percent, it means the grower needs to reduce production by 10 percent to keep from having plants left over.
In the pay by scan system, the grower is carrying considerable risk that outside forces (like weather) will affect total sales. In some cases, the best strategy might be to plan production to meet demand of a slower year. In all years, growers will ship all the plants they produce, and the risk of getting stuck with leftover plants is low. In stronger years, a grower can meet demand by purchasing product from other growers.
Producing At Cool Temperatures
There are strong incentives to reduce fuel costs by producing poinsettias at lower temperatures. There is considerable discussion about how to achieve this, and we know Europeans are doing it. Europeans are talking about growing poinsettias at 61¡ F, which sounds great but makes U.S. growers nervous.
We can divide the United States into three general fall temperature zones:Zone 1. The coldest parts of the country are in this zone, where August through September temp-eratures are lowest and greenhouses can be kept cool during the day. It is possible to use the Europeans' 61¡ F strategy here.
You have to take into account the two important aspects of poinsettia development affected by temperature. First, the cooler temperatures will reduce vegetative growth that occurs between pinch and initiation. To get the size you want, planting needs to be moved ahead 2-3 weeks. Second, the rate of development is greatly slowed after initiation, which means normally very early flowering varieties are needed.
I call this the "cool-from-start" approach. The alternative is to start with our warmer temperatures and then cool the crop to temperatures in the low 60s just before it finishes.
Zone 2. Greenhouse temperatures are warm August through September in this large section of the country. Something of a hybrid program will probably work best in this zone. Start with warmer temperatures and then lower temp-eratures later when the weather cools and the crop develops. In this scenario, if pre-initiation temperatures are kept warm like we currently use, earlier planting is not needed. However, if night temperatures are dropped prior to initiation, planting may need to be moved ahead 1-2 weeks. In this situation, early finishing varieties are needed because you want to finish cool for as long as you can.
Zone 3. This is the warmest area, and November temperatures are unpredictable. It may not be possible to keep the greenhouse cool, and it is a significant risk to finish a poinsettia crop early and hold it. This might work fine three out of four years or four out of five years, but a warm, humid greenhouse with mature poinsettias can be an ugly situation when it occurs. For southern growers, using scheduling or variety selection to spread out the crop will continue to be important. These growers can use lower night temperatures, which will save some fuel, but they should not shift entirely to early finishing varieties.
New Varieties For Big Growers
'Prestige Early Red' (Ecke Ranch). This is clearly the most notable new variety this year and may be the most important introduction since 'Freedom Red'. I expect that in 3-4 years it will be our most important variety. 'Prestige Early Red' looks like 'Prestige Red' and has the same strong branch structure. It will flower 10-14 days ahead of 'Prestige Red' and is close to or a little earlier than 'Freedom Red'. For southern growers, 'Prestige Early Red' does not suffer from heat delay like 'Prestige Red' and finish timing will vary from year to year like 'Freedom Red'. Notice in the image above that 'Prestige Early Red' is a little less vigorous than 'Prestige Red'.
For growers who have started black clothing 'Prestige Red' to produce an early crop, this is a good replacement. Many growers now growing 'Prestige Red' will find it easy to shift to 'Prestige Early Red' and hold it for later shipping. In warmer climates, a good strategy will be to do a natural day crop of 'Prestige Early Red' and then delay one or two crops on different schedules for later dates. A delayed 'Prestige Early Red' for midseason will be more predictable than a natural-day 'Prestige Red' crop.
'Ice Punch' (Ecke Ranch). This new cultivar has caused considerable stir. It is a unique novelty that in our consumer surveys causes the type of reaction we saw when 'Winter Rose Dark Red' and 'Cortez Burgundy' first came out. This variety will go through a strong growth period that should last 2-3 years before it starts leveling off. 'Ice Punch' is in a special program and is a Home Depot exclusive for 2007. If this program succeeds, it could help build the potential of better margins at all levels.
A few growers had this variety in a limited trial program and reports are it moved well at the store level. If you will be growing it for the first time, it has smaller-than-average leaves and bracts, so you do not want a plant with a stretched look. My suggestion would be to plant a little early to produce a few more leaves and use a little growth regulator to keep internodes compact. Also, the bracts come out red and then the area around the midvien fades to produce the white coloration. Thus, it looks better the more mature it becomes, and you do not want to ship it too early.
'Carousel Dark Red' (Fischer USA). Dark Red is a new color in the Carousel series that has a lot of potential. 'Carousel Red' has a unique appearance, is easy to grow and holds up well in stores. However, it finishes late and the color is an orange red. 'Carousel Dark Red' is earlier and marketable before Thanksgiving. Also, the color is a darker red. In a comparison of the two colors in our consumer surveys, Dark Red was picked 2 to 1 over 'Carousel Red'. Because it is earlier and less vigorous, 'Carousel Dark Red' will need to be planted 2-3 weeks earlier than 'Carousel Red'.