Job offersmore »
- Account-Manager - Wickede/Ruhr, Germany
- Grower for pot plant production - Tönisvorst - Germany
- Assistant Grower & Growers - Ohio, USA
- Fruit & vegetables Export-Import manager - Avignon or Perpignan, France
- Area Manager North Europe - Netherlands
- Area Sales Manager Oost Europa - Netherlands
- Benelux Sales Manager - Grow lights, Holland
- Productie Manager - Ethiopia
- Head of Sales Europe
- Engineer support in agricultural sciences - Switzerland
Top 5 - yesterday
- Second season for Idaho's only commercial blueberry grower
- Greenyard under fire after listeria contamination
- AU: New fully recyclable packaging set to take fresh produce industry by storm
- Enormous turnout makes for highly successful Organic Produce Summit
- “Europe is literally waiting for every lemon”
Top 5 - last week
Top 5 - last month
Exchange ratesmore »
Growth for vegetable preparation companies is mostly in conventional
The organic sector has the wind in its sails. Although the turnover of organic fruit and vegetables in Dutch specialist shops reported a slight loss in 2016 (54.3 million euro, -2.3%), turnover for this group of products in super-markets reported a considerable increase (148.4 million euro, +5.8%). The scarcity on the organic market appears to last a bit longer, to the regret of many people who switched. Yet the growth within the segment of fresh-cut organic vegetable products doesn’t follow the same trend. Buyers are a bit reserved, and end users in turn appear to be only convinced to a limited extent of the added value of the products.
“The organic segment of ready-to-cook vegetables has always been small. We don’t see it as a strong growth market,” says Jantine Heemskerk of Heemskerk fresh & easy. The company is specialised in cutting, washing and packing ready-to-cook vegetables, (meal) salads and raw food. “The real growth within processed product is in the field of conventional, both within the company and sector-wide.” Yet the commercial manager continues to closely follow the trends. “We don’t close our eyes to the growth unprocessed organic fresh produce is currently going through. Organic is a theme you can’t get around, so we’ll continue to offer organic alternatives to the ready-to-cook products in our range. However, looking at this branch compared to our total sales, the organic supply isn’t even one per cent of it.”
“Sales low, loss high”
About 15 years ago, the processing company introduced a line of organic products. Jantine: “Under the guise of ‘just trying’ we quickly came to the conclusion that this market didn’t really get off the ground. Sales were low, losses were high. Unprocessed product was and is more popular with the average organically oriented consumer. Nowadays, it’s not very different.” The conventional assortment of ready-to-cook vegetables, (meal) salads and fresh kits consumers can prepare at home, report the biggest growth.
Considerable price difference with conventional
The situation is similar in Belgium, according to Vincent Haspeslagh of Agrafresh. Just like Heemskerk Fresh & Easy, the company located in Pittem produces a wide range of salads and vegetable mixes. “From distribution and retail there is definitely a certain willingness to look for organic alternatives, but we don’t recognise a constant in this. The end consumer doesn’t yet seem fully convinced of the added value. Unlike in the first range, Belgian consumers mainly opt for freshly packaged, cut vegetables because of their greater convenience and interesting prices.” A number of products, such as oak leaf lettuce, are the exception to this. “These are more sensitive products that also have higher prices per kilo in the conventional assortment. The group of early adopters isn’t as put off by the higher prices.”
In the field of exports, the account manager sees plenty of growth opportunities, if quality, volume and continuity is provided for. According to him, it’s quite a challenge to find the balance between supply and demand. “The available supply is more limited in any case. Add to that the lesser stability in supply, and you end up with a high purchasing price as a result. The question then remains whether customers are willing to pay for this.” Partly thanks to the considerable price difference compared to the conventional supply, he has noticed that the growth of this segment is falling behind a bit in Belgium compared to countries such as France and Austria.
More contract farming boosts growth
If the side of supply continues professionalising and a better approach is sought in terms of price, Agrafresh anticipates many new sales opportunities. Vincent: “We just need to find out how we can better structure the entire supply chain within the organic segment. To realise growth, it’s necessary to create more certainty in supply. More contract farming, for example: with that, growers can be ensured of sales, and they limit their company risks to a minimum, while at the same time creating more continuity on the side of sales, so that they no longer have to worry about their stock level. Retailers naturally don’t want to lose face by having unforeseen empty shelves. Good streamlining in the supply chain between supply and end customer is a necessity.”
Vincent, while comparing the range of organic frozen vegetables, knows how close it is. “That market is going very well. It has a better range of spreading due to its longer shelf life. The life span of fresh-cut product is not much longer than seven days: you can’t work on stockage within that supply.”
Entire sector becoming more sustainable
The success of the market is also largely decided by the future economic climate. “There’s currently much willingness among clients to spend money on food in general. If we’re in an economic downturn, prices becomes decisive. Another option is that organic and conventional approach each other more and more, until we reach a general, more sustainable manner of growing and processing,” Vincent expects.
Jantine agrees, she thinks it’s a good development that organic farming principles inspired conventional companies to farm as sustainably as possible. “But the organic production isn’t comprehensive,” she emphasises. “Sustainability is more than that. It’s about taking responsibility for your surroundings – for people, animals and environment – and making optimal use of natural resources. The technology already exists, think of aquaponics and vertical farming. The sector should also pay attention to that.”
“It’s clear that the trend of healthy eating and living should definitely be stimulated. The fact that an important role is reserved for fresh vegetable products can only be welcomed positively,” Vincent concludes.
Heemskerk fresh & easy
Publication date: 12/8/2017
Receive the daily newsletter in your email for free | Click here
Other news in this sector: