Regional products, contract production and growers who take care of their own trade more and more often. Ben Messaoud, owner of Hortica from Andijk, the Netherlands, sees competition increasing on all fronts. Will the free market still have the right to exist in future, considering all the current developments?
Ben Messaoud, owner of Hortica
Hortica primarily trades in products from Dutch soil. “Ninety per cent of that comes from all over the Netherlands. We export a lot to France, Belgium, Germany and Italy, these are by far our biggest markets. A share was always sent to the UK in the past as well, but we stopped doing that. Brexit has nothing to do with that, though. For us, the reason was mostly that it was a completely different mentality in trading.”
Regional products
Right now, buyers throughout Europe increasingly prefer regional products. French supermarkets in particular ask their suppliers for French fresh produce products more and more. “Last year, we could already see this development for produit de la France. However, this is the first year that we’re actually feeling it. We could respond to that by ensuring our own production in France, for example, but we’d be in the way of part of our customers if we started doing that, and that’s naturally not something that we’d want to do. We haven’t just noticed this trend in France, by the way. Demand for regional products is growing in Italy as well. However, regional products in these countries mostly consist of domestic products. Some supermarkets, however, want products from specific regions, such as potatoes from Brittany or Normandy, for instance. That is something that makes things quite difficult for us.”
Competition
“In the import and export, we’re a commercial enterprise between grower and buyer in the processing industry. In recent years, we’ve noticed a competition from growers, sorters and others who sell their own crops on the market more and more. The processing industry enters into contracts with growers more and more for the volumes they need in certain periods. Hortica was founded nearly 30 years ago. We’ve built a good reputation for ourselves on the market, and we’re doing our utmost to guarantee a good quality for our customers. There are still plenty of products that have specific requirements and which require the right documentation. We all know that current buyers require low prices and good quality, no matter the situation on the market.”
Considering the quickly changing market and the healthy financial position of Hortica, Ben bought out his partner last December. “He was a good partner and we started Hortica together, but for flexibility at consultation level and making decisions it’s important to be the complete owner of a company. We’ve noticed more and more that growers themselves are becoming important players in the trade.”
Contract production
“In future, we’ll work on a basis of contracts more and more. Buyers want more certainty that the product will be delivered and growers want to be able to produce for acceptable prices. The situation on the free market is currently too difficult to achieve good prices. We also see growers waiting for better prices more often, and they therefore don’t always want to sell. The free market will always continue to exist, but perhaps to a lesser degree than is the case now. We can already see that in industry, which gets its product from contract production for 90 per cent, and the little bit left over they get from the free market.”
Prices
“Last season, prices were very low. Because of the warm summer of 2018, however, 20 to 30 per cent less was harvested for some products, so that prices started rising. Because of the small volumes, not much trade was left for us. However, it’s still weird to see products becoming scarcer and therefore more expensive, but that these aren’t sold quickly. A lot of buyers hesitate to pay such prices for the products.”
Ben has noticed a change in the organic production. “We’ve noticed that the increase in organic products in 2018 was still good and even increasing, but we’ll have to wait and see what’ll happen in the coming season. That’s because the organic area is increasing abroad. More will therefore become available on the market.”
Ben Messaoud