The current situation in the Middle East will mainly affect costs, expects Cindy van Rijswick, food and agriculture specialist at Rabobank. "In particular, the rise in energy costs is feeding through into many areas. For example, the impact on fertilizer prices is really substantial. The question is whether those higher costs can be passed on to growers."
"But I see the biggest potential impact being inflation. Consumers were already very cautious, but in recent years their purchasing power has been relatively well supported. That simply cannot continue indefinitely. There has already been a lot of uncertainty in the world over the past six years, and this situation certainly does not help."
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Fresh produce exports to the Middle East are also affected, of course, but that volume can be absorbed, according to Cindy. "For individual exporters specializing in these regions, it is of course quite frustrating, but companies have shown in recent years that they can anticipate such circumstances well."
As an example of a product that could be affected, she cites apples. "A fair number of apples have been shipped from Europe to the Middle East in recent years. If those remain in Europe, that could create price pressure. Another possible effect is that more Egyptian citrus could come to Europe, and South African exporters had already been spreading their markets more toward the Middle East and Asia in recent years."
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"Everything, of course, depends on how long the situation lasts. In my view, it once again shows how important the EU remains as the foundation of our fresh produce exports. Other markets remain surrounded by considerable uncertainty, and companies focusing on them have to take a range of possible scenarios into account."
For more information:
Cindy van Rijswick
Rabobank
[email protected]
www.rabobank.nl
