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Rabobank Horticulture Update November 2018:

"Mixed results greenhouse vegetables, phalaenopsis and lilies in crisis"

While market conditions for Dutch horticulture are reasonable, last summer's drought will leave a mark on results this year, according to Rabobank's most recent horticultural update.

The Rabo Horticultural Barometer is a fraction lower in the fourth quarter than a quarter earlier. The effects of the drought this summer seem to have been incorporated into the results. The average now stands at 6.8 (in the third quarter it was 6.9). However, there are significant differences in how the different sectors and crops developed.

Drought impact noticeable in all sectors
Production and price formation vary widely in the various horticultural sectors. The cucumber growers have had a good year, the results for bell peppers are reasonable, while the results for tomatoes are moderate.

Flower cultivation
In greenhouse floriculture the poor price performance of phalaenopsis stands out. For all other larger crops the average price was reasonable. More positive was the price development of chrysanthemums this year.

Tree nurseries
Tree nurseries generally performed well, with some differences between the different culture groups.
Flower bulbs
The dry summer led to a lower production of tulips. This not only impacts the results of the growers, but also creates a major challenge for greenhouse companies in the implementation of the growing schedules for the coming season. The cultivation of lily bulbs is going very poorly.

Getting sufficient employment is increasingly difficult for almost all companies. Especially for companies with large labor spikes, it is getting increasingly difficult to find good seasonal workers.

LNV: vision of circular agriculture
The new agricultural vision of agriculture minister Carola Schouten (LNV) means more government involvement in circular agriculture, in which she emphasizes small local and regional sales chains. How she defines it and wants to organize it remains to be seen. Moreover, it is striking that no funds have been made available in the budget, according to Rabobank.
Circular agriculture beneficial for consumers
What do consumers have to gain from circular agriculture? As Rabobank sees it, it will allow horticulture companies to be able to better map and communicate their environmental costs in the future. Such a sustainability score of environmental impact can be displayed on the product packaging or the website of the producer. The consumer thereby gains insight into how a company performs in important areas, because increased transparency is needed. This score could ultimately largely replace the large number of quality marks that currently cover product packaging. This system also gives companies better insight into how certain processes or raw materials burden the environment and how this can be improved.
In order to be able to finance investments in sustainability at a company level, scale-up is often necessary. The bank will also focus more on CO2 reduction with financing, but that is not always easy. Sometimes more (joint) investments are needed, while broader (individual) financial buffers are also needed. The government can contribute to solutions as well.

Source: Rabobank 

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