In the first nine months of 2014, Dutch vegetable exports grew nearly 6 per cent year-on-year. With favourable weather conditions leading to production coming online faster in the spring, more products were available for export.
Strong export growth
Demand from Germany, the main market for Dutch greenhouse vegetables, grew, as it did from Russia, the biggest growth market. ABN AMRO believes the increase is due mainly to strong retail growth and years of investment in relationships with distributors. Greenhouse vegetable exports within the EU rose by more than 6 per cent. Exports to Germany and Eastern Europe saw the largest growth, while exports to the UK remained fairly stable. By contrast, exports to France fell by as much as 25 per cent as a result of the ample supply of Spanish greenhouse vegetables in Europe. Exports to countries outside the EU saw a slight increase.
Favourable weather conditions are main cause of oversupply in Europe
After Poland and Spain, the Netherlands is the largest exporter of fresh vegetables to Russia. Because these countries may no longer export their products to Russia, the result has been an overcapacity and increased pressure on prices in Europe. Indeed, the average price of cucumbers and peppers is now 20 to 30 per cent lower than it was during the same period in 2013. Yet the main reason for overproduction has been favourable weather conditions in Europe, leading to a production surplus across the continent and ever lower prices. Continued oversupply in the spring will again result in further pressure on prices. Overproduction and highly fragmented supply are also leading to low selling prices throughout the sector.
All the links in the chain should share information
To overcome the challenges of overproduction, all the stakeholders in the chain – producers, traders and retailers – need to band together, ABN AMRO believes. The vegetable sector is moving towards closed chains with vertical transparency between them, whereby all the stakeholders in the chain can share information on products on the shelves. The result is better access and insight with respect to product information, sales figures, margins and product losses. ABN AMRO also believes the sector could do more to emphasise the qualities of Dutch greenhouse vegetables, positioning Dutch products to compete more effectively with those of other countries in terms of their freshness, wholesomeness and sustainability.
The full report can be downloaded below (Dutch only)