Orchid Farming & Cultivation Business Plan and Profiting Methods

Floriculture is big business. But how big is it? What are the limits of earning with floriculture? There are reasons to believe that some farmers who indulge in cultivating flowers have gone bankrupt. But there is evidence of others who have made not lakhs but crores in a year. What makes the huge gap and difference is the plants you choose and the risk you take and also, one key factor. The investments you make.

Orchids are one of the big businesses in floriculture. Though roses are one of the best-selling cut flowers in India, 80% of Orchids are imported from Thailand. This makes the flowers very expensive in India. But cultivating the same flowers in India could help farmers reap near the same price if they can match the quality and provide reliable, consistent business. 

Let’s take a quick dive into  some facts

  1. 80% of orchids are imported
  2. The cost of one orchid stalk could cost anywhere between 10 and 20 rupees depending on the variety.
  3. Some orchids are extremely expensive and could cost 1000’s 
  4. Orchids require a completely different method of growth compared to other flowering plants
  5. Orchids require a Polyhouse setup to grow well and produce commercial yield
  6. Investment required to start an orchid farm ranges from 35 Lakh to 60 Lakh depending on the variety. This investment is per acre.
  7. Initial investment deters many farmers from involving themselves in the business. This also has a positive side as there is not much local competition for these flowers.
  8. Orchids require a lot of care and the cost of maintaining the farm is considerably higher.
  9. The skillsets required to maintain the plant and care for it is different from most other plants and even flowering plants

For most people, the list may look intimidating yet appealing. The fact that there is lesser competition itself is a great deal but then you also have the other factors which include, the high price for the product and the value in general.

Unfortunately for new farmers these factors, however encouraging, may not be sufficient to pull them into the business. The high investment for the setup and maintenance of the farm alone deters most farmers. Apart from that, the skills required to maintain the farm and the cost involved to keep it running are also a deterrent. Then comes the final market. Is there a market for these flowers locally? If not where can they sell these flowers? Where are the buyers?

Each of these challenges has a solution. Some take time, while others require persistence and effort. Nevertheless, An average one-acre orchid farm can make a very good income ranging from 25 Lakh per annum to 50 Lakh per annum. Does it look doubtful? Read on and I will explain.

Orchids – Understanding the Orchid Flower and plant family

The orchid family is one of the largest flowering plant families in the world. To put this in perspective, let’s say that there are 4 times more orchids than all mammals today. Or twice the number of all bird varieties in the world. Did you know that the Vanilla plant from which vanilla bean is cultivated and vanilla essence is extracted is from the orchid family? The Catalunya flowers are from the orchid family too. You may have come across a few orchid varieties without even knowing that they are from the orchid family.to make things more complicated, there are over 100,000 hybrids of orchids, credit to orchid enthusiasts worldwide.

Orchids are always perennial. They have soft stems and no woody structure at all. 70% of all orchids are epiphytes in nature, meaning they depend on other plants to survive or grow on dead barks or such. Orchids are known to live up to 20 years or more in the right condition. in indoor conditions, orchids are known to grow for up to 15 years.

Orchid flowers produce seeds but these seeds do not germinate unless they are provided with the perfect weather conditions, humidity, and fungus. Though each seed pod contains millions of seeds and scatter like dust when it matures and bursts, they do not have the necessary nutrients to germinate and become plants. They can only do so with the help of certain fungi. A very minuscule amount of these seeds grow to full plants in potting media and most cases, never yield much success. Germinating seeds successfully requires lab facilities, knowledge, and patience. When provided with the right condition, the seeds will germinate in weeks and will take months before they will grow into a plant that can be handled, a task best not ventured by beginner farmers or the less patient.

Growing Conditions

Orchids require humid warm weather with light shade but then, it’s not a golden rule. Each plant variety has its requirement and they change. That’s one reason you cannot have a range of orchids in one single setup. While the dendrobium requires moderate to bright sunlight, others will do better in lower light conditions. But when you generalize, yes, the plants prefer warm weather which is highly humid. 7-80% humidity is normal for most orchids. Most orchids also don’t like direct sunlight. 70% of Orchids grow on barks and trees naturally and don’t prefer soil.

Indoor Orchid Care

At first glance, the orchids are the most complicated plants to grow. At home or a nursery, the requirements are quite daunting. High humidity at 70%? 50% sunlight? How are you going to manage such conditions? Think about orchids growing in nature and you will see them grow quite well without much care. They just dangle on a dead tree and dead branches with no care or effort. Orchid care is not as complicated as it seems once you get a feel for it and also learn the basics of managing them. As first-time gardeners, we always have the mentality of growing things in the soil. All plants are grown in soil. They need sunlight and the whole list of so-called normal terms which come with plants. But with orchids, you need to forget everything you learned. Orchids don’t grow in soil. They prefer dead barks or trees to grow from. They grab nutrients from the air (that’s right, moisture from the air) and some from the decaying barks of the trees. 

Replicating the same at home is considerably easy. Growing indoors, you straight away have the advantage of 50-70 % sunlight. While there are places in homes that are considerably darker, there are a few points in every home where some amount of sunlight comes through. This area is sufficient to grow your orchids. Orchids are also plants that love to hang. Though they are in pots filled with barks, keep them hanging. And as for humidity, well that’s tricky. Air-conditioned rooms may be a bit dry for orchids. Place orchids in any room without air condition or fans if possible. Hang the pots and ensure that you spray the orchids at least 3-4 times a day. That’s all you need to worry about apart from fertilizing them once a week.

How Orchids Grow

Apart from a few terrestrial orchids, which grow in soil, most orchids grow in tree barks and have spongy roots which help gather moisture from the air. They are more or less considered air plants due to this nature. The roots which are fixed on tree barks also help get nutrients from the bark which is usually decaying. While this may seem a bit complicated to understand, let’s put it simply. Fix an orchid to tree bark, Peat moss, Coconut husk, or a slab of wood and tie it together with twine. Water regularly and it will most likely grow given the right sunlight and humidity condition. Orchids don’t like too much water, so ensure that the water drains out as quickly as you pour it in. That’s the reason, orchid pots have holes on all sides. The water retention in orchid pots and media is just the quantity to keep the medium wet. The pots are just there to hold the medium. You will see a lot of protruding roots from the medium and for the weak-hearted, you may be tempted to cover them up with more medium. Don’t. These root nodes are out so that they can gather more humidity from the air. Covering them will deprive the ability to do just that, slowing the plant growth.

Location: My personal preference to keep the orchid at home is in the kitchen and the bathroom. This is because of the humidity in these rooms and the light conditions too. Both these rooms have moderate light throughout the day and high humidity. Also spraying water 4-5 times a day in the living room could make things messy. The bedrooms and other living areas are insatiable for orchids in MY condition because there is a running fan or air-condition in almost all other rooms. Well, you get the idea. Orchids in a bathroom may not be the best thing, but hey, they grow well. If you have a room with moderate (bright indirect) sunlight and can water the plants regularly (preferably spray) then you have an excellent place for your orchids.

Caring for Orchids

Orchids do not require much care, but if you are into a lot of plants, then care is imminent and regular. You need to dedicate a few hours every day to your orchid garden. This is only necessary if you have more than a few hundred plants. Not if you have 3-4 plants. With a garden of 100’s of plants, there is a need for regular watering, managing fertilizers, and nutrients, pruning, cutting, repotting, and more. The process is continuous and while it may take only a few minutes on some days, it may take up an entire day on others. It depends on your plant’s health, pests in the area, and your overall setup. 

Orchid Varieties Commercially Grown in India

Understanding the business of Orchid farming

There have been reports of massive profits in the orchid industry, with a hand full farmers making over 1 Crore a year. Are these reports factual? Is it even possible to make a Crore in income , in India, through agriculture and farming? These are questions that have been posed by many farmers. If it’s possible, why are more farmers not getting involved in this industry? 

The question, though straightforward and the answers multi-pronged, there is some evidence to prove that there has been a success in the orchid industry and it is profitable. The lifestyle of a farmer who has been into orchid cultivation for 10 years in Kerala indicates good profit. There is also the fact that the farmer has been into orchid farming for 10 straight years without considering any alternative crop which many other farmers are doing nearby. The amount though of on crore per acre Every year? That’s quite questionable. 

Many farmers who have been indulging in orchid farming find some success in growing the plants but they find it difficult to market, transport, and profit from it. With climatic conditions in the extreme, most states like Jaipur, and Rajasthan who are consumers of orchids find it difficult to cultivate them locally. The flowers need to be transported from eastern India or south India to fulfill their needs. The time to reach Jaipur is often 2-3 days from production states. The cost of transport is also a big problem. Apart from this, finding a buyer in Rajasthan for a person who lives in Kerala requires some effort and knowledge about the area. Even with all the advancements in technology and the internet, Farmers are still learning business and technology continuously. 

The second most important factor, when it comes to making a profit is the sale of plantlets as opposed to flowers. While the flower industry is great, there is a limitation to the number of flowers you can produce per year from a one-acre land. In most cases, each plant will produce only 8-10 stalks of flowers. With 50,000 Plants per acre, you are looking at 500,000 stalks per year on the higher side. That’s an average of 1370 stalks per day. When converted to revenue, you are looking at 27000 Rs per day or 1 Crore per year. That’s excellent if you can sell all your produce for 20 rs per stalk of flower and also sell all the flowers throughout the year. In business especially in the floriculture business where there are no processed products, the shelf life of flowers being short, you can expect a 10-150 % of no sale or perished goods.

Now let’s see the potential. India is the largest importer of Orchids in the world. It produces only 20% of its requirement while 80% of the orchids are imported from Thailand, Netherland, and China. 6400 Shipments or orchids were recorded in 2021 to India from various countries. The orchid market is good but how much is 80% of the Orchid imports worth. To put a number, it was approximately 64 Crores worth of orchids. An estimated 70 crores worth of orchids is imported every year in 2020. 

64 Crore of import is insignificant to the Indian market when compared to other produces like coffee and tea or cereals and grains which are imported in billions of Rupees if not trillions. But you also need to consider the value of Orchids in the Indian market and the restrictions involved in procuring cut flowers in India. A minimum of import duty is applicable for orchid import. This itself is a major deterrent, adding price to the product obtained. The second problem is the shipping time and the destination port. India restricts flower import to India only come through Chennai port. Transportation in itself takes time to reach India from Thailand and Netherlands. Now transporting flowers from Chennai to other parts of the country will take more time. For a perishable product like flowers, this puts a major bottleneck for importers. Even with such restrictions, if India imports 64 crores worth of flowers a year, there is still a market for Orchids. 

Challenges faced by farmers restricting the cultivation of Orchids in India.

Transportation Of orchids to end user from the farmer

India is a complex market. It’s also a complex country. With all the setbacks and problems we still move forward. Today, importing food from the USA may seem much easier than transporting produce from the eastern states of India to the western part. Transportation is a big bottleneck for most farmers. Also, most products that are produced in one part of the country have a higher demand and price in another part of the country. For instance, mangoes from the south, reach the rest of the country much earlier than the produce in other parts is ready, fetching a higher price for farmers in Kerala, Tamil Nadu, Andhra, and Karnataka. The produce like apples is always at a high price in the southern part of India than in the northern states where ist produced. While fruits and vegetables have a decent shelf life, flowers are short-lived. The faster they get to the buyer, the better.

Most of the orchids produced in India come from the eastern states, with Arunachal Pradesh having a big market. Kerala is one of the few states in the south which has a few orchid farmers. The rest of the country depends on these few states in the east and Kerala. Kerala farmers transport their produce to Rajasthan, Mumbai, Chennai, and Bangalore. The eastern states have a better market in Delhi and the northern part of India. Remember, transportation of cut flowers is done through air freight, and its costs add up to the cost of the product itself.

Infrastructure required for an orchid farm.

Farmers India has a small land holding, usually unable to make large investments. A nominal amount of 2-3 Lakh may seem feasible for some farmers but most farmers (80% approximately) cannot exceed that amount. Even with Loans and government support, the requirements for orchid farming could exceed anywhere between 25 Lakh rupees to 75 Lakh rupees. This is usually a very huge sum for a normal farmer.

Orchid farming, like most cut flower farming, requires a poly house. A playhouse construction could cost anywhere between 35 Lakh Rs to 50 Lakh rupees. Even with a subsidy of up to 60% from the government, most farmers can’t make this amount as an initial investment. On top of the cost of the playhouse, the additional cost of setting up the plants, buying plants, and maintaining the plant for up to a year till the production stage, all costs added up. Loans are not available for large sums and the risk of interest and market fluctuation also deter most farmers from investing such large amounts into one single project.

Education on Orchid plants and flower cultivation

Most farmers in India have been cultivating rice, wheat, cereals, and vegetables for ages. Flowers were rarely grown and even when grown were only used for perfumery or lose flowers. The concept of cut flowers is completely new for most farmers in India till a few decades ago. With cut flowers come to a range of problems from knowing the plant and flower itself to processing and packing the flowers. Unlike loose flowers, cut flowers go through a completely different process. They are cut, Packed, and stored in certain fixed conditions. Transportation too is crucial as most cut flowers travel greeter distances than loose flowers do. Apart from the whole process involved, there is also the problem of understanding a completely new flower and plant. Orchids are not grown in soil. They are epiphytes. The requirements are different from soil-grown plants and flowers. Education is (WAS) hard to acquire for most farmers until recent technology which helps impart information and education like youtube. Most farmers are unaware of how the whole process of cutting flowers work and this makes it difficult and farmers are cautious, especially with such huge investments

Marketing Orchid flowers and plants

It’s obvious that when you enter a new market, everything seems difficult. You don’t know where to start and how to sell the products you have managed to create. Orchid farmers are often left in a difficult situation because they are not sure how to sell the produce. Orchids are not sold in mandis or the markets in India. They have a special set of back door sales. Most orchid vendors have to tie up with florists, restaurants, and halls or hotels for their sales. Some have a different approach and find exporters or even people in other states. But most farmers find it difficult to reach such people. Moreover, orchid sales are great in metros but have no value in rural India. The price seems exorbitant for most people in rural India.

Orchid farming investment, Costs, and Profits

Setting up an orchid farm is straightforward. There are a few essentials that cannot be avoided and then there are a few not so essentials but good to have instruments and gadgets which can help you in your orchid farming process. Here, I am assuming that you are in a tropical weather condition with no extreme weather changes. If you are in a location that is prone to extreme cold or heat, you may need a setup that can maintain the conditions in temperature. The Below figures are for one acre Polyhouse setup for orchid farming

Polyhouse Setup35,00,000
Plant Cost @100 Rs per plant50,00,000
Infrastructure (Stands, Pots)20,00,000
Growing medium100,000
Fertilizers, Pesticides & Chemicals45,000
Labor 20 Fixed laborers10,00,000
Sprinkler and Drip setup100,000
Climate Control (Optional)100,000
Miscellaneous100,000
Total11945000

Yes, the price does look exorbitantly high for any normal farmer to try orchid farming. This is intimidating at first sight and often found to deter farmers from investing a huge amount in one project. An investment of 1 Crore, 19 Lakh rupees in a plot of one-acre land is a bit too much for most farmers, even though the returns may sound promising. But then What exactly are the returns?

Let’s assume that each orchid plants produce 8-10 Stalks of flowers a year. Each stalk costs a base price of 15 Rupees per stalk. Your total production would be 60,00000 rs to 75,00000 Rs per year in flowers alone. Now apart from flowers, Assume that you would be able to sell approximately 15,000 pieces of Plant sapling or plantlets for 350 Rs per plantlet Retail (Wholesale prices start at 100 and may go up to 150 or 200 but retail prices are always higher). This could account for another 52,50000. The total revenue would be approximately 11250000 – 12750000. Theoretically, you would have covered the cost and expenses you have put into the business in the first year itself. Unfortunately, this is not always the case in agriculture or business in general. There are losses, periods of low demand and prices go down seasonally. Accounting for all these factors, the possibility of breaking even in the first year may not be possible, but surely, it’s possible from the second year forward. 

Also, Note that some of the figures in the expenses are a lot higher. For instance, you could bulk import quality plantlets from Thailand at half the cost. To add to that, a lot of farmers are provided a 50 % subsidy on greenhouses and poly houses. This surely cuts down the cost of farming orchids.