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Rabo horticulture barometer: business confidence up slightly

Horticulture has had a good year so far in 2023. Companies are in good financial shape on average. Entrepreneurs do worry about cost increases coming soon. Themes such as labor, crop protection, and water are also keeping companies busy.

The most recent measurement of the Rabo horticulture barometer comes with a score of 7.3. This is a slight increase: last quarter it was still 7.1. The Rabo Horticulture Barometer data show that all subsectors are doing reasonably well to well.

Greenhouse horticulture businesses keep costs under control
Greenhouse horticulture companies with Combined Heat and Power (CHP) can usually keep energy costs sufficiently under control through good energy management. However, there are concerns about announced government measures, which will increase energy prices for horticulture. Good news is that the phase-out of the reduced tariff recently changed from five to 10 years. Such an announced increase in energy prices may well stimulate investments in energy saving, as most companies have investment room for this. However, the full electricity grid does limit companies in their energy transition.

In greenhouse vegetables, the pricing of tomatoes and peppers was ample this year. Their prices are clearly above the average of the past five years. Productions are often just slightly below that. This is partly due to later planting dates. Revenues may make up for increased costs. The cucumber price fortunately showed some recovery in the third quarter. Its production and price will be at about the five-year average in 2023.

Ornamentals are doing less well, phalaenopsis market balance improved
Floriculture under glass is clearly doing less than greenhouse vegetables. Prices in the (hot) summer months were lower than in 2021 and 2022 due to less demand from key markets such as Germany and the UK. It remains to be seen how demand develops at Christmas and Valentine's Day. Supply from Africa seems to be back on track due to lower airfares. As a result, competition is fiercer than during the Covid-19 period. Due to the war in Israel, supply from that country is currently limited.

In potted plants, the supply of phalaenopsis seems to match demand better after the area has been cleaned up. The market balance has improved considerably. In other potted plants, however, there is pressure on prices as consumers bought less this summer.

Click here for Rabobank's further findings on (the state of) horticulture.

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