Waking up early to hear a lecture on economics sounds like something you had to do in college, not something you’d choose to do as a plant-growing professional. Still, the annual State of the Industry address at Cultivate, the conference and trade show organized by AmericanHort, has grown so popular lately that the session had to be relocated to a bigger space to hold all of its attendees.
The horticulture industry represents a $3.5 billion market sector and has created 2.5 million jobs in America, according to Ken Fisher, president and CEO of AmericanHort. That’s why “what we do together is important – and the way we do it is important as well,” he said.
Fisher added that “demographics is destiny.” As the country’s populations shift, the organization is investing in the future leaders of the industry, through initiative like Women in Horticulture, the Hortscholar Program, the HRI Leadership Academy, more Spanish language education opportunities and more certifications.
Vice President of Advocacy & Government Affairs Matt Mika then had to the chance to talk about the “Trump 2.0 roller coaster.” In the president’s second administration, Mika explained, as policies are enacted, and then rescinded, you go through a lot of ups and downs and “tend to end up where you started.”
To help get off the ride, he implored, “You need to get engaged, to make your voice heard. You are the experts.” Make phone calls; send emails; attend meetings; invite your legislators to your operation so they can see first-hand what you do, what you need and how their policies impact horticulture.
If you want assistance in reaching out, the organization uses VoterVoice to help with outreach. Find it at votervoice.net/iframes/AmericanHort/Register/PrivacyPolicy.
Mika touched on the topics most salient to growers, starting with ag labor and the workforce. Up in the executive branch, AmericanHort is having meetings at the White House and with the Department of Labor, USDA and the Department of Homeland Security to advocate for the industry. With Congress, they are collaborating with the House Ag Committee on a realistic Farm Bill.
As far as labor, he reiterated that reforms are needed for H-2A and H-2B. With the Adverse Effect Wage Rate, AmericanHort is seeking a two-year freeze to allow time for broader program changes.
With the ongoing “tariff tango,” Mika noted it was a “big win” to get tariff-free peat moss approved. They are working to get the administration to get them to understand how all these tariffs impact growers.
AmericanHort, along with hundreds of other agricultural associations, signed on to three different letters advocating for the following tax provisions (all of which are included in the One Big Beautiful Bill Act):
- 199A deduction – permanently extending the Qualified Business Income Deduction to 20%
- Bonus depreciation – extended through 2029 for eligible property
- R&D deduction restoration – allowing immediate expensing of domestic research expenditures (2025-29)
- Estate tax relief – permanently raising the estate and gift tax exemption to $15 million/person starting in 2026
- Expanded Section 179 expensing – increasing the maximum deduction to $2.5 million, with a phase-out starting at $4 million
- Production property deduction – with a new 100% first-year deduction for agricultural/manufacturing/infrastructure
Plant health is a priority as well. Working with USDA-APHIS, the focus will be on better efficiencies at Plant Inspection Stations; handling box tree moth; updating Phytophthora regulations and the Ralstonia exclusion program; and tracking and treating emerging pests and diseases.
On the EPA side, progress is happening. The Application Exclusion Zone had a final rule released in September 2024; and pesticide strategies are moving forward. The Herbicide Strategy saw its final rule in August 2024; the Insecticide Strategy in April 2025; and the Fungicide Strategy is in development. Debate continues on provisions in the Endangered Species Act.
Mika said they’re also leveraging relationships at the federal level to protect industry priorities – making sure research programs are funded and sustained; adequate staffing is in program offices; there is development and continuity of specialty crop programs; they are communicating the impact of rules and regulations; and that they’re educating the White House and Congress about horticulture priorities.
To drive home how critical all these issues are, AmericanHort is hosting its annual Impact Washington Fly-In Sept. 15 – 17 to discuss ag labor, the Farm Bill, supply chain issues, plant health regulations and appropriations.
The Main Event
Dr. Charlie Hall, chief economist for AmericanHort, was the star of the show, as always. His delivery of detailed economic information in an easily digestible manner provides a great way for growers to see where the industry has been the past year and gives educated predictions about the near future.
Hall kicked things off optimistically, showing that grower top-line sales YTD in 2025 are up 78% compared to 2024. (Those sales totaled around $3 billion.) And, as the pandemic year continues to have ripple effects, he noted top-line sales are up 98% compared to 2019 (with 69% of growers reporting their sales are up by more than 25%).
Net profits were also reported up by 74% of growers vs. 2024 (and up 81% vs. 2019). Units sold, however, is a mixed bag (literally) – 50% of sellers said they were up on units sold, and 50% said they were down.
“Who experienced trifecta?” Hall asked, meaning that top-line sales, net profits and units sold were all up compared to last year. “There’s a few, but it’s mostly been a ‘so-so’ performance – and that’s okay.”
Different regions are seeing different performances, often as a direct result of weather issues. For the areas covered by Country Folks Grower, it looks like this:
- Mid-Atlantic – Revenue YTD +2.3%; average sale total +1.3%; transaction count +1%
- Midwest – Revenue YTD +1.2%; average sale total +2.6%; transaction count -1.4%
- Northeast – Revenue YTD +0.1%; average sale total +3.2%; transaction count -2.9%
- Ohio – Revenue YTD +3.5%; average sale total +3%; transaction count +0.5%
- Southeast – Revenue YTD +0.1%; average sale total +3.1%; transaction count -2.9%
Generally, this means in these regions, even though transaction counts may be lower, customers are tending to spend more during each transaction.
Hall also detailed current economic conditions, noting trends in gross domestic product – which was down in the first quarter of 2025, due mostly to the aforementioned tariff tango. Predictions are for an increase in GDP in the second quarter and the rest of the year.
Ongoing geopolitical conflicts and the tariffs will lead to inflation – there’s no doubt about that. Hall charged those in attendance to find out “in great detail” how the One Big Beautiful Bill will benefit their businesses, “because eventually we will have to pay the piper.”
“Tariffs will create revenue but also create issues,” Hall said, making the issue a double-edged sword. Depending on how much inventories are drawn down (and a lot of other things), growers will likely see a 3.1% increase in costs this year. If all the tariffs go into effect, though, there could be a 9.4% inflation rate in 2026.
A silver lining is that consumers always spend money. “Expenditures always rise to meet incomes and we’re not going back to pre-COVID levels,” Hall stated.
As the chief economist, he also discussed that annual concern – recession. Is an economic recession imminent? His answer was a strong no, but with the caveat that mortgage rates need to drop for a major boom in home purchasing. The current recession probability is 20% to 40% likely, “but I think it’s really dependent on the Big Beautiful Bill,” he said.
Hall’s concluding points were nothing new, but worth repeating. There is mixed performance across all sectors of the industry – but negative year-over-year comparisons aren’t the whole story. Growers must track customer analytics to see trends over time. Be sure to manage your working capital and focus on your value proposition.
“We need to be agile, nimble on our feet,” Hall said. “And we need to create those interlocking relationships.”
