Colombian floriculture is facing a combination of rising costs, an unfavorable exchange rate, and higher tariffs that are putting increasing pressure on growers and exporters. According to Diego Vargas, General Manager of La Gaitana Farms, the industry is dealing with several challenges simultaneously, making this one of the most difficult years he has seen in the flower business. “Today, Colombian floriculture is facing a combination of geopolitical, logistical, and exchange-rate challenges that are simultaneously putting at risk the competitiveness and profitability of the sector,” Diego says.
Since 2024, Colombian growers have been facing an increasingly adverse environment, including higher labor costs and a weaker dollar. Margins have been decreasing, and growers have been asking for price increases. The exchange rate has changed considerably. In 2024, the average exchange rate was close to COP 4,071 per U.S. dollar, and it ended the year at approximately COP 4,409. However, by the end of 2025, the exchange rate had fallen to approximately COP 3,757 per dollar. The flower industry estimated that the Colombian peso appreciated by around 15% during 2025, with a similar appreciation occurring in 2026.
What growers did not see coming was the dramatic deterioration of the U.S. dollar against the Colombian peso in 2026. On August 25, the official exchange rate was approximately COP 3,056 per dollar.Diego Vargas
“The exchange rate is becoming a structural problem”
Flowers are mainly exported and sold in U.S. dollars, while most production expenses, including salaries, local transportation, services, maintenance, and supplies, are paid in Colombian pesos. Therefore, a strong Colombian peso can significantly reduce the amount of pesos that companies receive for every dollar earned abroad.
“For every U.S. dollar that we receive, we have less income in Colombian pesos. So that creates a mismatch in our cost structure,” Diego explains. “In practical terms, revenues fall while costs remain the same or continue to increase.” For an exporting company, the impact can be significant. For example, receiving US$1 million when the exchange rate is COP 4,400 produces approximately COP 4.4 billion. At an exchange rate close to COP 3,100, the same US$1 million produces only about COP 3.1 billion.
The international sale has not changed, but the company receives significantly fewer Colombian pesos to pay its local expenses. This situation makes productivity, financial planning, cost control, and operational efficiency increasingly important, Diego says.
Rising Labor costs Add to Pressure
At the same time, the cost of labor has increased considerably. Floriculture is one of the most labor-intensive industries in agriculture, with approximately 16 workers per hectare at the production level alone.
Colombia’s minimum monthly wage increased from COP 1,300,000 in 2024 to COP 1,423,500 in 2025, an increase of 9.53%. For 2026, the minimum wage increased again to COP 1,750,905, representing an increase of approximately 23% compared with 2025. This means that in only two years, the minimum wage increased by approximately 35%.
“This cost pressure is accelerating a necessary shift toward labor productivity rather than simply labor reduction. Better workforce planning, improved crop yields per square meter, automation in post-harvest processes, optimized bouquet assembly, digital production controls, improved training, and data-driven labor allocation will increasingly distinguish competitive operations from those unable to absorb structural cost inflation,” Diego says.
The currency pressure comes after growers have already had to respond to the increase in Colombia’s national minimum wage. Earlier in the year, companies raised prices, and many customers accepted the increases. But there is a limit to how far prices can be increased without affecting competitiveness and consumption. “There is some point where if you increase the prices, you affect consumption.”
Fuel and Transportation Costs
Fuel and transportation costs are another important factor. Flowers are perishable products and must move quickly from farms to airports, distribution centers, and customers. Higher fuel costs affect trucks, agricultural machinery, suppliers, and the complete logistics chain. Earlier this year, geopolitical tensions in the Middle East, particularly those involving Iran, contributed to higher oil prices and disruptions in international transportation. Airlines subsequently made significant adjustments to their freight rates and operating costs. For Colombian flower exporters, the impact was immediate.
Higher U.S. Tariffs Add Further Pressure
Another major challenge has come from U.S. trade policy. The United States is Colombia’s most important flower market, receiving close to 80% of Colombian flower exports. In April 2025, the United States introduced a 10% tariff on many imports, including Colombian products. More recently, from July 24, 2026, the United States increased the tariff to 12.5% under Section 301 on many Colombian products, including cut flowers. Although the U.S. importer is legally responsible for paying the tariff, its economic incidence is ultimately determined commercially. Depending on market conditions, the cost may be absorbed by the importer, transferred to consumers, shared with the Colombian exporter through price negotiations, or reflected in sourcing decisions.
This creates additional pressure on prices and competitiveness. However, the strong commercial relationship between Colombia and the United States should not be underestimated. Colombia continues to be the leading supplier of cut flowers to the U.S. market. In 2025, exports of Colombian flowers to the United States were close to US$1.9 billion, almost double their value in 2012. American consumers, supermarkets, wholesalers, and florists continue to rely heavily on Colombian flowers because of their quality, variety, availability, and reliable supply.
Concern for Employment and the Sector
The combination of higher labor costs, increased freight rates, a stronger Colombian peso, and higher U.S. tariffs is creating an unusually difficult environment for the flower industry. “Each challenge would be significant on its own. The real concern is that they are happening simultaneously.”
“Protecting the competitiveness of the flower industry is also about protecting the 240,000 formal jobs that the sector generates, particularly the employment opportunities it provides to women in rural Colombia,” Diego says. The financial pressure is already being felt by some companies. “There will be some companies that may face serious financial distress.”
Focus on Value Over Volume
Despite the difficult market conditions, Diego remains positive about La Gaitana Farms’ position. The fundamentals of the industry remain strong, with consumers around the world continuing to value fresh flowers. The company is also less dependent on the US market than many Colombian flower exporters. Around 50% of La Gaitana’s sales go to the US, 45% to Europe and 5% to the Far East. “Diversification is becoming increasingly important. Companies need to develop markets where Colombian flowers can compete on value rather than simply on price,” he says
“The future of Colombian floriculture will certainly require discipline, innovation, and cooperation between companies, workers, government institutions, exporters, and international customers. However, Colombia has important advantages: an excellent climate, experienced workers, strong logistics knowledge, exceptional flower varieties, international recognition, and decades of commercial relationships.”
Diego sees opportunities in further developing markets in Europe, Asia, the Middle East and other emerging markets, where the company can seek better prices. For him, this points to a broader change in how Colombian flower companies should approach growth. “For the next years, companies have to think less about growing through volume and think more about growing through value.”
The current environment therefore represents a strategic inflection point rather than simply a period of adversity. “The companies best positioned for the next cycle will likely be those that integrate management, productivity improvement, cost-to-serve analysis, logistics optimization, commercial discipline and market diversification into a single competitiveness agenda.”
“The challenges are significant, but so is the strength of an industry that has proven, year after year, that it knows how to keep blooming.”
Travis Rigby is a publisher and entrepreneur focused on growing the floral industry through media, data, and product innovation. With a journalism background from the University of Utah, he founded and led PosterGarden.com for 27 years before transitioning into floral publishing. Today, Travis is the publisher of Florists’ Review, one of the industry’s most historic and influential titles, which he relaunched in 2026 with a focus on rebuilding its audience and transforming it into a modern data-driven platform for advertisers and readers alike. At Florists' Review Media, he oversees a portfolio of floral brands including Florists’ Review, SuperFloral, Canadian Florist, Flora (UK), Australian Florist, and LivingFlowers.com.
