Cucumber prices are currently reaching record highs. Severe weather in southern Spain has almost completely halted supply from the country, leaving Belgian and Dutch traders facing an exceptional market situation. "Cucumber prices are reaching extremely high levels, the likes of which I have rarely experienced in my 15 years in the sector at the start of the season," says FMB's Jonathan Vandesande.
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"There are increasingly more Belgian and Dutch growers who start the new cucumber crop a little earlier each year," he continues. "That always involves a risk, because if you enter the market with cucumbers at the beginning of February, there can still be considerable production from Spain. This year, however, the situation is different. Due to disappointing volumes and quality issues in Spain, Dutch and Belgian growers with early crops are virtually entering an empty market."
"Today we are seeing cucumber prices of around €1.15. If you can maintain that level for a few weeks, you can almost secure your season. They took the risk and are being rewarded twice over. This year, it has clearly paid off." It is also translating into additional activity for FMB. "We are exporting far more cucumbers than usual in January and February. It is good to be active during a period that is typically relatively quiet."
Promotions without volume
Still, Jonathan feels the market may be approaching its peak. "In Germany, several retail promotions are planned in the coming weeks. These were arranged at lower price levels, but you sense that the retailers are not receiving the volumes they need or were promised. As a result, additional purchases are being made on the free market at higher prices. That is less favourable for Spanish suppliers, but our growers benefit because they are operating in an empty market."
Looking at other greenhouse vegetables, the trader notes that they are less influenced by the cucumber surge. "For sweet peppers and aubergines, I have slightly less visibility because we currently do not have our own cultivation of these. Tomatoes are moving reasonably well, but the market there is less dependent on Spain. Turkish products are also entering the market, so the supply is more diversified. With cucumbers, the situation is different. There is some product from Greece, but it is not comparable in quality. The market is effectively dependent on Spain, and if there is a shortfall, tension arises immediately. We are now in a position to help fill that gap."
More demand for contracts
According to Jonathan, this situation is likely to continue in the coming days. "Nobody knows how long it will last. With the planned promotions in Germany for which Spain does not have sufficient volumes, combined with limited sunshine in Belgium and the Netherlands, meaning I do not expect a major production increase, and prices are likely to remain firm for a while. Cucumbers will remain a luxury product for the time being."
As a result, there is a growing demand for retail contracts. "Trading partners want to protect themselves against what they experienced with Spain this winter. That is not a negative development for us, as it provides greater stability for both the growers and us. You can secure certain sales and make longer-term commitments. That is healthier for everyone."
Early Easter
Looking back on the winter season, Jonathan describes it as solid. "Despite the macroeconomic challenges, it went reasonably well. You can see consolidation in the trade, with smaller firms withdrawing and larger players becoming stronger. That sometimes makes negotiations more challenging, but as a group we are stable enough to make strategic decisions with confidence."
Attention is already shifting towards spring. "Shortly after Easter, in early April, larger volumes of greenhouse vegetables usually come onto the market. This year, Easter falls early, so the market will still be relatively empty, resulting in tight availability and high prices. After that, the situation should gradually normalise, and the market is expected to stabilise again."
For more information:
Jonathan Vandesande
Frans Michiels & Zn (FMB)
Kempenarestraat 50A - Bus 3
2860 Sint-Katelijne-Waver, Belgium
Tel: +32 15 560600
[email protected]
www.fmb.be
