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Rijk Zwan - Hydroponic Farmers Federation Conference

Snacking vegetable market continuing to grow despite global challenges

The snacking vegetable market is continuing to grow despite the recent global challenges across the industry, according to a leading international vegetable breeding and seed production company.

Paul Simmonds from Rijk Zwan joined the recent Hydroponic Farmers Federation Conference in Dandenong, Australia, virtually from the Netherlands, where he told delegates that tomatoes, cucumbers, and capsicums (peppers) are a growth area, especially in high-tech growing regions.

"Whether it is small high-paced cherry or mini-plum, or even if it is at the commodity end of snacking products, all of these are still growing massively," Mr. Simmonds said. 

"So that is something that we are focusing a lot on as a breeding company, to make sure that we are supporting that growth."

Despite the pressures of the COVID-19 pandemic and, more recently, inflation, he says the general market trends are not that different. Mr. Simmonds explains that commodity growers still want more yield and the premium product growers want more taste, color, or eating experience to differentiate their product.

"When we talk to our customers, we get a good insight into what they are looking for in the future," he said. "Actually, most people want both yield and taste, and from that perspective, nothing is changing. However, with inflation, the cost of production is becoming a thing, so we need to look at what the sales price can be to ensure the food prices can be maintained. I think we will see a bit of a change in the next three years in how important yield is, but we (as a company) are well positioned."

Another trend Rijk Zwan has noticed is that over the past 18-24 months is that the fast food chains that use vegetables are bringing the procurement of the produce from the field to glasshouse production. Mr. Simmonds explains that Rijk Zwan even has some breeding programs that are aimed at the products that foodservice want, which is 'very different' from what the retailers are requesting.

"The big driver for this is the food safety part of it and the hygiene," Mr. Simmonds said. "In the past 5-10 years, there have been more high-profile cases of food poisoning outbreaks, often linked to field production. The fast food chains and food production places are not interested in having their name associated with this and see glasshouse production as a way of securing their corporate responsibility to provide safe and healthy food. This hasn't just happened over the COVID pandemic, but there were early movers. They also really understand the benefits of glasshouse products and how that can play off against the increased cost of production. But aside from food safety, the volatility of supply is significantly reduced when you go into glasshouse production."

He added that labor and energy are the two main issues that nearly every grower has to face in glasshouse production, with few countries that have not been impacted and have a stable supply of workers. This has been exacerbated by lockdowns caused by the pandemic and restriction of movement of migrant workers. With a shortage across all sectors and not enough people for the work that is needed to be done, Mr. Simmonds says that many producers need to offer incentives to attract staff, such as increased wages and other novel bonuses.

"What this does is make robotics much more interesting," he said. "As the cost of labor goes up, and the difficulty in getting it, there's the opportunity to reduce the payback on some of these expensive and difficult to justify projects. Although they are limited in commercialization at the moment, we will absolutely see these things in greenhouses very soon."

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