Massive price and cost increases for fruit and vegetable producers can be expected in the coming year, as Christoph Freitag (pictured right), managing director of the German BOGK, told us. "Producers will have to raise the prices of their products due to the enormous rise in costs, above all for energy and sheet metal. How much they will have to raise their prices individually depends in turn on negotiations with their distributors."
For example, some jam producers - who are members of BOGK - have already complained about dramatically increased prices for raw materials, in addition to the costs already mentioned. Furthermore, they have had problems obtaining raspberries period. Producers primarily source frozen goods from Central and Eastern Europe and South America. "Producers will probably have no choice but to raise their prices," Freitag says.
In addition, particularly labor-intensive goods such as cucumbers will also put pressure on companies due to the increase in the minimum wage to €12.00. Says Freitag: "They will have to factor in the fact that raw produce will become more expensive during the main harvest period starting in May because growers will have to reckon with higher costs for their seasonal labor. However, the costs that occur due to the new minimum wage will not be reflected on price negotiations until September 2022."
Despite these adverse conditions, most producers will continue to pursue their work, Freitag said. Still, he said, there have been isolated farm closures. "It's a gradual process that goes on for years."
Things will remain difficult in 2022, Freitag said, without citing any specific negative trends. "For vegetable processors, the harvest was fine this year, although they, too, are struggling with costs, of course. In the fruit sector, matters were compounded by the fact that many raw materials were in short supply. Regarding Covid, again, pretty much all companies have been able to adjust well. Omikron hasn't been an issue yet, but of course, there's no relief in sight either. Everything has become more expensive, but despite Covid, the work goes on."
For more information:
Bundesverband der obst-, gemüse- und kartoffelverarbeitenden Industrie e. V. (BOGK)
Tel: +49 228 93291-0
Fax: +49 228 93291-20