It has been a difficult asparagus season so far, according to reports from across the globe. Due to cold weather during the spring growing season in both Europe and North America, there has been a delay in production, as well as lower volumes in many countries. This has not been good for prices, as demand is lower than usual, specifically compared to pre-COVID times. The delays to earlier growing regions mean that once the weather heated up, they came into production at the same time as many others, causing further price pressure on the global market.
The Netherlands: Good demand for asparagus from retailers, exports to Germany lacking
The fine weather is currently resulting in a large supply of asparagus on the market. "We see that the beautiful spring weather has played a role in the consumption of asparagus. Especially in the Dutch retail sector there is even more enthusiasm for asparagus than in other years", says a large Dutch asparagus grower. "We also see a remarkable increase in the demand for peeled asparagus this year, thanks to a higher demand from the catering and food service sectors, but retailers are also running more promotions with peeled asparagus this year. At the same time, we see that in the countries around us, especially the German market, there is less demand for Dutch asparagus than in other years. I can't quite put my finger on why that is. It is a pity though, because although we in the Netherlands consume most of the asparagus we grow, the export is more than welcome, especially when you see that the consumption per household in Germany is even higher than in the Netherlands."
"This does have an effect on the price development of the past two weeks in the day trade. At the same time, you have to ask yourself whether the current clock prices are a reference for the prices in the market. After all, these are the volumes for which there are no customers and, in my view, you simply have to ensure that you have customers for the volume that you cultivate. The next two or three weeks there will still be nice volumes on the market, but after that the decline in acreage will accelerate. There will be quite a few hectares out of production in the coming weeks."
Germany: Challenging asparagus season
Domestic offloads dominated the scene by a wide margin. Availability outstripped demand significantly. After all, interest had dwindled considerably after Mother's Day weekend. To work around or resolve overhangs, dealers often had to reduce their demands. Sometimes the reductions were quite severe. However, even with the reductions granted, subsequent sales did not always accelerate. In some cases, prices continued to fall. It was not until last weekend that customers took a more courageous stance. But even then, overflowing inventories could not always be avoided. The lower valuations of domestic batches made it difficult for European imports to gain market share. As a result, their quotations also crumbled.
According to an asparagus spokesperson from northern Germany, the local asparagus production is not working at 100% capacity because the existing quantities can hardly be sold. Prices have dropped from 20.00 euros/kg to 10.00 euros/kg within three weeks. Although there are positive aspects seen in the gastronomy and catering industry, this is to be taken with a grain of salt, since many establishments report that they could not reach anything close to pre-COVID levels.
With green asparagus there is the issue that food retailers are primarily marketing cheaper goods from abroad. Food chain marketing was also more focused on goods from abroad, for example, for Italian goods with satisfactory qualities. Spain was also mentioned as a particularly serious competitor in the green asparagus sector.
The demand for asparagus from the Netherlands has decreased significantly in Germany, as commodity prices from Spain and other countries undercut those of Dutch produce. Usually, as soon as the qualities of German goods has dwindled, Dutch goods enter the market. However, according to the spokesperson that was not happening this year. The mood among Dutch asparagus producers was therefore rather miserable, which is comparable to the mood among German growers.
Even though white asparagus remains a top tier product, green asparagus has seen more growth. Then again, it is expected that many asparagus farms, especially small ones, will probably stop producing altogether, while large farms will reduce their areas. The slump in consumption, which has just been added to by the war in Ukraine, represents an extreme situation. The problem seems to partially stem from the prices that were made at the beginning of the season, which were deemed to have been too high. Although production has increased by 1 Euro per kilo due to the wage increase of over 25%, asparagus is currently cheaper than in previous years.
The spokesperson also sees little positive impetus from the food retail sector right now to change this situation. However, the weather has been beneficial for both asparagus foil crops and strawberries. At the beginning of May, the willingness to buy and consume these products has become a little better. These challenges will primarily affect small farms in southern Germany, he suspects. The south used to benefit from the fact that they could achieve good sales with good volumes in the early season. Southern German farms used to be able to score well, especially with the early season, before produce from the north came in. That planning didn't work this year because the season started with poor prices.
Import asparagus and import strawberries can be offered in Germany therefore more favourably than German asparagus, since the wages are lower: In Italy, there is no minimum wage. In Spain, the minimum wage is 6.06 euros per hour, in Greece it is 3.83 euros per hour, and in Hungary it is 3.21 euros per hour. At currently 9.82 euros per hour, Germany is already more than 1.5 to 2.5 times higher, according to another association from southern Germany.
UK: Slow start to asparagus season
The UK asparagus season got off to a slow start this season, the dull cold weather had it running a couple of weeks behind in mid-March but by the official opening of the English season – the 23rd of April - the production had caught up and was back on schedule and growers were moving from tunnel production to open field production with the expectation of having 100% British asparagus on shelves by the first week of May.
The Scottish asparagus crop was also well underway by the beginning of May, with the earliest crop being harvested in Perthshire in mid-April.
It is now peak season and demand is good, with most retailers doing promotions on asparagus. The biggest challenges facing growers are the increasing costs, one of which is labour which is also scarce because of a backlog in processing visas. The UK government also introduced an increase in the minimum wage for seasonal workers this season which has seen wage bills increase by 20-30%.
France: Complicated start for French asparagus
This year, the asparagus season has generally been very complicated for French asparagus growers. The reason: a notorious lack of consumption, despite a production that is 10 to 30% lower than in 2021. Among the four main production basins that are New Aquitaine, South-East, Anjou and Alsace, it is the exporting regions (beyond the regional borders) that have suffered the most from this lack of demand. Indeed, Alsace, which has many small producers and where direct sales are well developed, was less affected by the situation.
The producers whose asparagus is found on markets of national interest such as Rungis and Perpignan, have seen the price of their production fall for about three weeks because of the marked presence of other origins such as Germany, the Netherlands, Belgium or Spain. A situation amplified by the willingness of some countries like the Netherlands, prefer to sell at a loss on other markets rather than on their own. This is why at the end of this week at Rungis, the price of a bunch of green asparagus was 1.5 euros and white asparagus at 2 euros.
The situation is also very complicated for organic asparagus. The lack of consumption is also affecting this sector, causing some producers to sell their organic asparagus on the conventional market. This situation has not only caused a big loss in terms of turnover for these asparagus growers but has also contributed to the congestion of the conventional market.
Faced with the lack of consumption, some producing regions are forced to stop production a fortnight earlier than usual. The South-West and South-East are currently stopping the harvest and Anjou will finish at the end of the month. Generally speaking, the producers who will have fared best are those who were the earliest in the campaign. Nevertheless, for the majority of them, the pivotal period of Easter when consumption is always the most important went rather well.
Belgium: Open field and greenhouse supply ensures low prices
The Belgian asparagus market is having a hard time at the moment. "The prices are just not really good at the moment," says a Belgian asparagus grower. "We are in a period in the asparagus season, especially after Easter, when the greenhouse and open field supply are both on the market. As a result, the oversupply has caused prices to plunge. It has not yet recovered in recent weeks and is set to For the time being, however, the demand was certainly good, especially for Mother's Day. Qualitatively, however, everything is fine, so the expectation is that the market will become more balanced in the near future."
Italy: Lack of demand causes 20% lower prices for Italian asparagus
The asparagus season started late in the province of Foggia (Apulia). A producer and trader reports: “The boom in production occurred immediately after Easter. Then, there was a collapse in prices and demand. The bad weather slowed down the growth of asparagus and, fortunately, stocks in the warehouse have finally been reduced. Last weekend, demand for the product increased. At around 20 per cent higher costs, we are selling our asparagus at 20 per cent less than in the previous campaign. And this in spite of a lower yield of about 20 per cent. This is the situation at domestic and international level.”
“The real problem is that there is a lack of planning. We work on a day to day basis,” the producer and trader continues. "In addition, labour is scarce and therefore processing is limited; 250 gram packaging or trays, for example, are not made. And we prefer not to harvest the product: in field rotation, we leave about 10-15% of the asparagus in the ground. This actually also allows us not to put more pressure on trade. The law of the market is indeed clear: the greater the supply, the lower the prices.”
A consortium of asparagus producers in Trentino Alto Adige, in the far north of Italy, has just finished harvesting and selling the product. Prices were very good until the Easter period, then demand dropped significantly. The quantities harvested were 15% higher than in 2021. The quality of the product was also in line with expectations.
Spain: 30% lower yield due to cold spring weather
The green asparagus season will end in about two weeks in Granada, the biggest growing area in Spain. The harvest started around two weeks late due to the cold temperatures and the dry weather in the region. The rains in spring somewhat palliated the water shortage, although yields have been 30% lower this year due to the cold temperatures. Prices have been good until the first week of May, when other European countries started their local harvests, around two weeks earlier in most cases, due to the summery weather. The demand for Spanish green asparagus has therefore dropped, although prices keep holding on as some European retailers stick to the Spanish product. In normal circumstances, the Spanish season would end by mid June, but this year the campaign will be much shorter. The heat wave in Spain this week is also affecting the quality of asparagus. However, this year it has been complicated and the area could decrease for the next season, as the labor shortage is rapidly worsening year after year.
North America: Good prospects despite slightly later start to asparagus season
Demand for Michigan asparagus continues to grow. “We see increases in our Michigan asparagus sales annually. Retailers have continued to promote it and excite customers into buying up the first spring crop Michigan has to offer,” says one Michigan-based shipper.
In Michigan, overall supplies of asparagus have improved in the last few days due to the heat the state saw last week. “But we are cooling down now which will help keep quality excellent. The volume is a little lower than same time last year,” he says.
Right now, Michigan asparagus is being harvested from the southern counties and is working its wat up the Michigan lake shore. “Michigan has been around 10 days later than normal because of cold weather,” he adds. While southern Michigan is later to start this year--typically the region is two to three weeks ahead of the northern growing region--the northern part is on time. Production will go until July 1st.
Other regions also currently shipping include Indiana, New Jersey, Washington, Canada and some Mexico and Peruvian imports still. However, import demand is softening because a lot of that business will ship to local deals such as Washington and those will switch over to domestic grown programs.
As for pricing, pricing on asparagus looks to be a few dollars more per case than last year. “Prices will fluctuate slightly over the next few weeks but will start increasing as we get into June,” he says.
Australia: Decline in volume and value of Australian asparagus
According to the latest statistics there was a slight drop-off in volume and value of Australian asparagus from the previous year. For the year ending June 2021, 6,857 tonnes were produced, which was a 17 per cent drop-off on the previous year, with the value at $81.1million, 6 per cent down. Exports dropped 39 per cent in volume to 1,876 tonnes and 21 per cent in value to $19.6 million. Japan took up the greatest share of exports (67%) followed by Singapore (9%) and South Korea (8%). At the same time, Australia imported 3,115 tonnes of asparagus, which was up from 3,068 the previous year. An additional 1,022 tonnes of preserved asparagus were imported, while under 1 tonne was exported. There is a major opportunity for the industry to grow consumption, with only 31 per cent of Australian households purchasing asparagus.
Next week: Global Overview Oranges!