Potato contract gets its own working group

All the tension caused by the drought resulted in this consultation. It became an unofficial meeting between the Vavi and LTO Arable farming. "We have more contact, but usually not face-to-face," says Hylke Brunt, secretary of the Vavi. "There is a great desire from LTO Netherlands to break open the potato contracts. For example, growers want compensation for the heavy irrigation. That is their negotiating position. This is not an issue from the Vavi."

Jaap van Wenum, foreman of LTO Akkerbouw, sees it differently: "The growers do their utmost to grow the crop, resulting in high costs. These are not reimbursed. We have to think about the contract model. A contract that is applicable in years of shortages, but also in times of abundance. Raw material security is number 1 for a processor. Only then does the price come. While arable farmers are actually looking at the price. We are therefore setting up a working group with 3 representatives from both sides. we found each other."

Frequent consultation
What both parties quickly agree on is that it is too early for firm conclusions. More can be said about the main harvest in mid-September. It has also been decided to maintain more intensive contact with each other; not only in terms of contracts. "Sustainability, innovation, economy and risk distribution are all points that we want to discuss in the context of a future-proof potato chain," says Brunt.

"The potato processors want security of raw materials, LTO Netherlands understands that," said the secretary. Vavi sees changing the contract conditions at this time as changing the rules of the game while the game is being played. "If it is decided to change points into contracts, this will be for the 2019 harvest." That also agrees From Wenum.

Role of the media
Brunt increasingly notes in the media that it is suggested that the existing contract cultivation has had its day. "I am not authorized to speak about this, but in reality it is not as black and white as it is described," he says. "Factories don't want to squeeze growers. You need each other. Real entrepreneurs know very well what's going on. The media intensifies the debate."

The year 2018 will not be remembered as the year of change, but as the year in which good consultation took place. "I don't think LTO Netherlands left with a bad feeling. If factories decide to adjust their own requirements, that is up to them. A collective policy has not been agreed." In some cases, potato processors themselves choose to adjust the contract conditions. For example, LambWeston/Meijer recently informed growers that they would change the size grading once from 40 to 35 millimeters.

The arable farming chairman hopes that 2018 will bring about a change. Van Wenum also wants to look beyond national borders to see how contracts are handled elsewhere in Europe. "A North American model is not feasible. We are looking for a completely different model. Please note: processors also have a major problem. For example, the rough specifications are not achieved, resulting in long fries fog. That is a loss in the sales of fries."

Tons versus hectares
It can be even more extreme. Brunt cites the example of the Belgian potato industry: "Here we work with tonnage contracts, not with hectares as we do. The risk lies more with the grower. You could say that the chain is lagging behind in the development of the relationship between grower and factory. Perhaps not so strange, after all, the Dutch industry is older and more mature."

At the same time as the Dutch negotiations, the Belgian Belgapom talked with interest groups Algemeen Boerensyndicaat (ABS), Boerenbond and the Walloon FWA. They showed up earlier clearly out in the media. The new umbrella industry organization must provide relief. Here too, nothing concrete has been decided in the short term. "Factories are very flexible in assessing the quality of the new harvest," says Belgapom secretary Romain Cools against the Vilt website. "It's too early to say anything about the main crop."

Belgapom hopes for new growth, which the rain of the last few days should help. Fairly green plots may benefit from this. The fear of overgrowth persists. Belgapom calls on processors to enter into discussions with growers who cannot meet their obligations. That satisfies the advocates. The Boerenbond then sees a solution in weather insurance. However, the disaster fund must also continue to exist.

Other contract forms
ABS wants a force majeure clause in the contracts. The Netherlands serves as an example of how things should be done. The Belgian vegetable sector is also more lenient when it comes to contracts. Belgapom does want to talk about switching from a tonne contract to a hectare contract, but only before next season. According to the trade association, a '1-on-1 comparison' with canning contracts is not realistic.