"We made a bit more money this year"

Historically high income for Dutch greenhouse growers... or not?

Of all agricultural sectors in the Netherlands, the greenhouse growers have seen their incomes increase the most. According to the annual income estimate of LEI Wageningen UR (as published on agrimatie.nl), partly based on Statistics Netherlands figures, the greenhouse growers have an historically high income of 274,000 euros.

The income is highly depended on price setting for products. Yield prices fluctuate more than they used to, which has strong effects on the income at larger companies in particular. In addition to market strategy and yield prices, income is also determined by operating conditions, professionalism, management qualities and difference in company strategy.


Price mutation compared to 2014 for tomato, bell pepper, and cucumbers (top three bars respectively)

Revenue
In the Dutch greenhouse sector, the average revenue of companies is almost 2 million euros per company. The greenhouse vegetables companies consists of companies that are mostly dependent on a single crop. So that group includes tomato, cucumber and bell pepper growers, who are all faced with a different price mutation for their products. See also the figure above. For a tomato company with a 2 million euro revenue, the stated 9% price increase could signify a yield and income increase of nearly 200,000 euros.

Growers react
We asked growers from the three greenhouse vegetable sectors LEI focused on, for their take on the Dutch research institute's claim.

"Historically high? I'm surprised," Arie Alblas, grower of red bell peppers replies. "Revenue has been better, especially compared to the previous years. But when you throw the past three years into the mix as well, it's not great." Arie has been growing peppers for thirty years, and he says 2007 was the last really good year. "This year the average price is good, but not historically so."

Cucumber grower Ruud Zwinkels also thinks the "historically high" claim is over the top. "We made a bit more money this year and had a few historically low years. That does come into play." When it comes to historically good years, Zwinkels does remember a season a few years ago. "Cucumbers are always tricky, but we switched at the right moment and added another good production round of tomatoes. It couldn't be better at that moment – we threw a six every time we needed to. But," he adds, "it's still a lottery."

Jaco den Bakker, cucumber grower, thinks there's something in the claim. "We had a good year, that's true. We haven't been used to prices like these in the past five years – but you do need them to keep the company going." So his Christmas dinner will be a bit more relaxed. "But you never know what nature will bring. It's been hot and dry in Europe, and prices have been high because of the low production – but it's still a lottery of supply and demand."

Tomato grower Paul van Schie doesn't agree with the claim either. "It's nonsense. We were in the black, but to have a healthy business, the margin needs to be a bit bigger. Individual tomatoes have been under pressure for a number of years. We are seeing a change in terms of acreage though, which offers hope for 2016. I sometimes say we're not dependent on the economy, but on the climate in Europe. That was noticeable this autumn. In order to ensure horticulture can be invested in again, financing expenses need to come down, and we need multiple good years for that."

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