For more than 30 years, Dr. Hans-Christoph Behr has worked in the fruit and vegetable industry as an expert and consultant. He is a long-time employee of Agrarmarkt Informations-Gesellschaft mbH (AMI). Among other things, Behr told us about the consequences of the current rising costs for the industry, the development of greenhouse production in Germany and other trends he observes.
Greenhouse vegetables in Germany
In view of the climate crisis and other weather and climatic circumstances, the need for protected cultivation is increasing in Germany. According to Behr, it is mainly fruiting vegetables that are still grown in greenhouses. “Fruiting vegetables mainly concern cucumbers, tomatoes and peppers. There is certainly still a lot of progress in this area. But there is certainly a great interest from food retailers to buy regional greenhouse products because there are only small quantities of them.”
With regard to tomato prices, there is also a higher price difference between the local product and the foreign supply because the German product is currently paid more. However, that’s not the case for cucumbers and peppers, he said. “Sales figures will certainly increase further, but not to the point of supplanting imports. This is why we have not seen a drop in imports, because the greenhouse shares are still relatively low. In the case of peppers, the proportion produced in Germany is around 3-4%, reaching a maximum of 6-7%. So these are huge growth rates, but still low in global comparison. »
Although the share of greenhouse cultivation does not exceed the share of outdoor cultivation in the vegetable sector, he said, an upward trend towards greenhouse cultivation is already emerging for individual crops such as berries. “Especially with products like raspberries or strawberries, I definitely see more potential. This is partly because it is difficult to harvest these products without rain protection, especially during summer rains. If a strawberry, raspberry or blackberry gets wet, there will be difficulties regarding its shelf life. This is why growers are turning to indoor cultivation. As for the raspberries, a larger quantity already comes from the tunnels. For strawberries, the number is already over 20%. But for lettuce or cauliflower, I don’t see any protected crop coming. It’s too easy to get these products from Brittany or Spain.
Consequences of rising costs
According to Behr, rising freight, fuel, energy and other costs are not yet reflected in the fruit and vegetable sector. “If we look at, say, the first quarter of 2022, taking into account consumer prices in particular, we see that fruit has not necessarily become more expensive, but in some cases even cheaper than the previous year. It is true that the costs are increasing. can certainly be seen, but these are long-term consequences that do not affect the current season yet,” says Behr.
Availability, not cost, is the deciding factor
For example, he says, the apples that were sold most recently were financed with the costs of tree maintenance, plant protection and harvesting, in other words, wages and the costs of the last year. “Salaries should certainly have increased already, but not immeasurably. In the end, it is also a question of the quantity of products available. After all, this year’s European apple harvest has been abundant, especially in Poland. As a result, we can see that the Apple market is currently under severe pressure. In the long term, it is therefore not enough to point out rising costs, but above all to pay attention to the quantities available,” says Behr.
No significant new sales markets
Behr currently sees no “revolution” in the fruit and vegetable sales markets. “It is certain that the online fruit and vegetable business has high relative growth rates overall,” says Behr. But the online retail market share of fresh fruits and vegetables is still small, he says. “If someone gets their entire purchase delivered, there’s bound to be some fresh produce among them. But you have to distinguish between full delivery services such as a Rewe delivery service or a pick-me-up. nic and true delivery services with immediate delivery of items. former is simply structured differently and follows certain routes that make more sense to them logistically.”
Profitability of online service providers
For example, companies like Getir, Gorillas, and Picnic would have plenty of cash on hand, but not necessarily in the black. “In the long term, this may not work, especially considering labor costs. Such models may work very well in countries with extremely low wages, but if each batch has to be delivered individually to the customer, this business model is satisfied with Unless the company charges a corresponding surcharge, in which case the customer base could again disappear.In this area, I do not see the current growth continuing indefinitely.Yet, the service providers capable of solving this so-called “last mile” problem could experience healthy growth.
“Other service providers may also experience good growth rates. But as long as losses continue to be maximized without anyone objecting, the pattern will continue.” At the same time, however, Behr observes a counter-movement: “There are investors who no longer want to support this form of financing and instead want to see profitable numbers again. So, of course, it’s immediately over for these companies. .”
Rising growth rates in the organic sector
Behr assumes that the organic industry will also experience new growth rates. “If we have severe economic downturns, in other words, if economic growth tends to turn negative and there is a climate of crisis, then it will be more difficult for organic. But I think we “We’re still a long way off. When the climate gets really tough, then the discounters’ market share will grow more, the climate talk will take a back seat, and even the ‘struggle for survival’ will prevail. But we’re not there yet. As long as we are still reasonably well off, and I guess it will stay that way, the share of organic will continue to grow because it is also seen as a solution to the crisis. For example, for the climate crisis, the general environmental crisis , etc.
Target of 30% by 2030 unrealistic
Meanwhile, Behr doesn’t think it’s realistic to assume organic share will hit 30% by 2030. “The question is, of course, how that would even be implemented. You can set many There is, after all, a lot of discussion at the moment about the exemplary nature of, for example, public institutions like public canteens etc., where people demand a “compulsory proportion” of organic products for the At the moment, I see good growth opportunities for organic, as it is seen as a solution to the crisis.”
For more information:
Dr. Hans-Christoph Behr
Agrarmarkt Informations-Gesellschaft mbH
Such. +49 228 33805-0
Fax +49 228 33805-592
Email: [email protected]
The Web: https://www.ami-informart.de/