“The outlook is better than last year,” begins Tony Derwael of Bel’Export, who handles global fruit and vegetable trading. He is referring to the Belgian pear season, adding that picking is generally lower than the WAPA forecast. He expects the Belgian crop to be around 380,000 tons, about the same as last year.
Tony sees the whole of Europe is expecting lesser harvests, which brings opportunities. "European consumption is usually at two million tons, while the current production forecast is at 1,5 million tons. That must have some effect; we'll feel that during the season in demand." But in late September, he is not dissatisfied with pricing. "With median prices of about €0.80, I think prices are good, even considering the higher costs growers face. Some sizes are reaching double last year’s prices,” he says.
Failed crops
Yet, Tony advocates cautious optimism. "We must guard against being over-optimistic. This pear boom is purely because of successive crop failures." He points in particular to the problems Italian pear production currently faces. "Once Italy no longer has those failed crops, pear sales will become much more difficult again," he explains.
“Though the climate plays a role, crop failures are temporary.” Tony points out that it is hard to estimate how climate change will progress, and that early and late-year cycles naturally alternate. "In the '80s, there were late-year, short growing season cycles, with late harvests and fewer kilograms. In the last 20 years, we’ve had early-year cycles, so we were getting huge tonnage per hectare," he continues.
Temporary
Derwael indicates that in the 80s, 40 tons of, say, Jonagold were harvested per hectare; now that is 80. He suspects the cycles may change again and that the low Italian pear harvests could be a temporary phenomenon. In any case, he does not see mass pear orchards uprooting in Italy.
Tony is optimistic about the apple market in the short term too, where he notes production is also low, providing a solid base in the form of high industry prices. He attributes that mainly to Poland’s disappointing harvest. "They should pick 10% less. So, instead of the usual 4.5 million tons of apples, the harvest volume will probably only be roughly four million tons. That's far less - 400,000 tons less in Poland is all of Belgium and the Netherlands combined apple harvest. That says something."
Solid base
According to the trader, the late frost and it being an alternate year in Poland are the main culprits. "In an alternate year, the blossoms freeze very quickly, and there are definitely fewer of, especially the Jonagold and Idared varieties. Many Idareds go to the industry, and we’re already feeling the effects. Industry prices are rising. We’re talking about prices of some €0.18, whereas last year it was barely half that. We can build on that," Tony explains. Exports are picking up, too. "This year, we have temporary permission to export to India because that country’s harvest is low, too. Red apples are, thus, more in demand there."
However, Tony is less optimistic about the local top fruit market. "It’s worrying that apple and pear consumption is declining. Young people are eating less fruit than they used to. Barely 30 years ago, Belgian apple consumption was 15 kilograms per capita; now it’s 6.7 kg. That’s alarming," he notes, adding that top fruit has much competition from tropical fruits. "Someone who buys, say, avocados no longer takes apples." Nor does Tony see the local top fruit’s relatively favorable prices as a plus in times of inflation. "People have only so much to spend and must make do with that. And you can easily pass up on fruit, unlike, say, bread," he knows.
Labor costs
Tony considers rising labor costs greatly concerning to growers and consumers and fears fruit growing labor costs are becoming unsustainably high. He also sees cost differences between Belgium and the Netherlands increasing, with the Netherlands having much higher labor costs. That negatively affects the market, with much Dutch fruit being sold directly in crates and pears even being exported to Poland for cheaper sorting. High labor costs, thus, impact market dynamics and force growers to make strategic adjustments.
Automation
Automation, especially in the sorting process, could help control costs, though, says Tony, it does not directly affect labor costs. He believes that "anything we can automate, we should" and particularly sees opportunities in apple and pear sorting, where robots can replace manual labor. Tony predicts that within ten years many robots will be used in the sorting process, even if the initial investment is significant. You could quickly recoup that via labor cost savings, especially in the Netherlands where wages are relatively high.
Regarding harvesting, though, he does not yet see feasible automation possibilities. The cost of deploying enough robots to replace human labor during the harvest period would be too high, even if you could buy or rent robots, Tony reckons. It would not be worth the money spent, especially since the harvest period is quite short, only one month.
Voor meer informatie:
Tony Derwael
Bel'Export
Neremstraat 2
3840 Borgloon - België
Tel +32 12 440 551
[email protected]
www.belexport.com