Lavender farming in Croatia

Overview 2003-2009

By Danijel Coric

Pioneer steps

• Very developed aromatic herbs production in the 1950’s, 60’s,70’s

Playing the business “Big league”

-70 tons of lavender oil per year

-200 tons of sage oil per year

-Everlast oil, laurel oil…

-Pyrethrum – natural insecticide – major producers

-due to inactivity and switch towards tourism, technology moved to Kenya and USA so now they grow authentic Dalmatian type of Pyrethrum

Expansion of tourism

• Tourism kills the collection of wild plants• Lavender fields at island HVAR and other coastal regions

die out, detroyed by fire and negligence• People swith to tourism without using lavender as value

added asset – rather sell SUN&SEA• Continental distillers reamain active mostly on basis of

wild collected herbs from Bosnia, Dalmatian background, Serbia, Macedonia

• No real farming operations for aromatic plants except for Chamomile

The years of warfare

• Still, up to 1990. industry remains vibrant

• War brings mine fields and loss of interest in medicinal herbs

• Haresting and processing of aromatic plants almost dies out

• Lavender at HVAR grown at minimum – from 70 to 2 tonnes of oil per year in 2000.

New incentives – wrong people

• In 2002. IREKS industry offers free plants to anyone willing to grow lavender for their industrial needs

• Most of the plants were planted in small garden-like patches – no economic value

• Some plants re-sold and never planted in designated areas

Sudden boom in interest for lavender

• Journalist started exploring the financial side of lavender farming

• Too much sensationalism• “No work-a lot of money” ideas• First continental farms in Jaska (near Zagreb), Varaždin,

Hrvatska Kostajnica• First serios scientific research at Zagreb University

…plant that revives the rural areas!

• From 2004. till 2008. around 50 new farms in continental Croatia, with average 5000 plants

• Revival in coastal region – Istria optimisticly plan 600 ha of new farms until 2010. – delayed

• Hvar – new farms and re-planting of old ones - tourism

Technology issues• No good advisory on farming lavender, organizing a farm,

seling the flowers and oil• Too many small farmers going to buy their own distilation

units – low usage of installed capacity• Production cealing reached with given technology and

knowledge• Lack of machinery for further expansion of production

Need for strong organizations

• 2006. – Lavandula Croata association of farmers is formed

• 30 members with 25 ha of fields in 2009.

• Advisory and machinery pose main issues to cope with

• Export and standardization are the next steps

• Need for increase in filed size to min 5 ha for sustaiable production – French farms average 40 ha

Distilling capacity oversized, but…

• So far 3 main distillers use max 30% of their capacity• Need for new 1000 hectares of fields to compete with

global players like Bulgaria and France• Cooperatives and lab tested oils required• Specialization far from happening:

oil – flower – distilling

Huge opportunites• Vast patches of land remain unused and turned into

young forest – depopulation and effects of war• Bad governement policy – no tax on land• 2000 eur per hectare – cheap land for expansion• Expansion of production stops at manual labour

limitations – need for “Machine ring” organizations• Interest of foreign investors hindered by bad legal

situation

Organic production – ex war zones

• Ex war zones were not used for agriculture for years

• Cheap land and incompetent local administration

• Association’s goal – go organic• Paperwork games – bad domestic

certificates• Need for international standards• Organic chance on small fields

Switch to value added products• Slight progress in product design • New products – souvenirs and

cosmetics• Bad marketing and lack of funds

for market research• Far behind Bulgarian brands,

French “out-of-space”• Need to work on integral

lavender story in Croatia• Visibility and recognition

CROATIA=LAVENDER

Pricing the goods – retail vs. wholesale

• Not competitve in wholesale for export• Low production capacity and limited flexibility• Prices in retails often higher than in France• Need for management and sales skills • No niche business education offered – everybody on

their own• China – better design, low price – NOT ORGANIC

Association’s plans

• Coonect more national farmers in 2009.• Start cooperation with regional associations in Balkans• Unite the offered oil quantity for export• Connect with US and Australian farmers for education

and exchange• Protect local variety of lavender Budrovka• Promote new high yield angustifolia varieties• Travel to global trade fairs and contact buyers• Apply pressure on goverment for better conditions

THANK YOU FOR YOUR TIME