News Corona crisis

Aviko fears job loss and sounds the alarm

10 April 2020 - Niels van der Boom - 16 comments

French fries producer Aviko has sent Wouter Koolmees, the Minister of Social Affairs and Employment, a burning letter today (Friday 10 April). In this, the food company asks for a temporary wage cost subsidy. So far, the company has no right to that. This is reported by various media.

Aviko has 1.100 employees, 500 of whom work at their production location in Steenderen in Gelderland. Chris Deen, CEO of the Royal Cosun subsidiary since this year, calls on the minister in a letter to relax the current NOW (Emergency Bridging for Employment) scheme. Only parent companies can now claim this scheme.

severe situation
The letter states according to De Gelderlander that Deen fears otherwise for job retention and payment of salaries. In an explanation, Deen says that the situation can become serious if the company cannot make any claims under the scheme. If this is successful, 90% of the wage costs will be reimbursed. According to Deen, the situation is extra dire, because competitors do receive this subsidy.

No commitment
The current situation is a direct result of the corona crisis, which hits Aviko hard. The minister has not yet made any firm commitments. Employers' and employees' organizations have already asked for relaxation of the scheme.

Aviko is by far the largest company within Cosun with a 45% share. Last year was their best year ever, with an estimated turnover of €921 million.

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Niels van der Boom

Niels van der Boom is a senior market specialist for arable crops at DCA Market Intelligence. He mainly makes analyses and market updates about the potato market. In columns he shares his sharp view on the arable sector and technology.
Comments
16 comments
Noord 11 April 2020
This is in response to it Boerenbusiness article:
[url=http://www.boerenbusiness.nl/akkerbouw/aardappelen/ artikel/10886670/aviko-vreest-banenwaarden-en-luidt-emergency-clock]Aviko fears job loss and sounds the alarm[/url]
During the annual cosun meeting, only a few wondered why a sugar industry is investing its hard-earned money in potatoes. We were shown the place with disapproving looks. How stupid could we be not to participate in the frieshausa. There must be a bigger plus on the beet price, let's build another factory soon ........ a flashy construction animation made the sugar rush through our veins. Now all I have left to do is make a prediction ...... and the management will dismiss this wonderfully ........ but in my opinion cosun is in GREAT danger.
jochem 11 April 2020
If last year was the best year ever and you are already moaning and whining about adversity, you must be incredibly ashamed in a dark corner. And you certainly shouldn't start whining that they have to change the rules for you, yes for you, because you are so pathetic.
bunglers.
ground worm 11 April 2020
Aviko is right that they are sounding the alarm, also in the interests of the beet growers' shareholders.
If other chip factories are allowed to make use of this arrangement, it is not a level playing field.
Aviko is a wonderful company that we as farmers can be proud of.
??? !!! 11 April 2020
I pay, I grow beets.
cosun board; get up!
Subscriber
post 11 April 2020
Excuse me. Companies that earn millions of years in a row and now after 4 weeks less production already start to moan. I'm sorry, I can't help but want a grab from the pot. Government, please pay attention and give it to them where it is really needed!
time bomb 11 April 2020
Cosun's ancillary activities have resulted in a good balance for years. Balance poor in recent years, but slightly better balance thanks to secondary activities. This also thanks to Aviko. You shouldn't be so short-sighted, and try to think positively about some sugar beet cultivation. I know there is a big hair in the butter right now, but it will come out
bassie 11 April 2020
jochem wrote:
If last year was the best year ever and you are already moaning and whining about adversity, you must be incredibly ashamed in a dark corner. And you certainly shouldn't start whining that they have to change the rules for you, yes for you, because you are so pathetic.
bunglers.
People like you are exactly the people North meant who wave everything away. Cosun has a knack for structurally talking about things that are going well, and then avoiding tackling the real problems. agree with north
Subscriber
Peer 11 April 2020
The extremely special situation of today was not expected by anyone. Now those responsible have to adjust where they can and they apparently do.
This is in the interest of all those involved at Cosun and Aviko. All the farmers and the people who earn their living there.

And Noord, you are probably a top entrepreneur, just like Jochem of course. Maybe you want to share your success factors with the drivers, who knows, it might help.
If you happen to look bad at your family-run business and so you're basically a shepherd, I'll allow you to continue with it and let the people do their job. Happy Easter to everyone
Joris 11 April 2020
Aviko is going to invest many millions in Steenderen this year.
It has been announced that this will go ahead anyway.
The shutdown and (several weeks) have already been budgeted for this year.
They are building a new factory so everything is going well.
The wages are a fraction of all these amounts, so Aviko doesn't whine, but puts its weight behind it.
That whine before you're beaten is pathetic and unnecessary.
Investments are now being made that would otherwise require a standstill.
So in terms of loss in production time, this is zero.
Too bad, but no one is falling for this.
Subscriber
juun 11 April 2020
perhaps an eye opener for all those guys who walk around with their laptop and calculation models to be expensive and omniscient not everything is right in those models but again the weather diseases and pests are unpredictable for this you always have to have a buffer in reserve according to my grandfather, he is still right posthumously
Claas 11 April 2020
Cosun allocation 105% this year. Expansion despite the fact that the guaranteed beet price last year was already 6 euros per tonne.
The fact that it turned out well was due to Aviko's high profit distribution, which must have been converted to more than 10 euros per tonne.
Aviko will be loss-making next year and no dividend will be available to support the beet price.
So for next year, with a production of 1 million tons of sugar, Cosun will make a loss of at least 6 million euros.
So both Cosun and Aviko can start licking their wounds and figure out how to repair the drain on their financial reserves.
Aviko is more aware of this than Cosun because they have been familiar with a fluctuating market situation for much longer. It is not without reason that every effort is being made to limit production/contracting with the farmers.
Cosun, however, is sticking to the old saying that the sugar factory must be fully planned because that is the best economically. What they don't realize is that they are subsidizing the customers with money that belongs to the farmers.
In this market with bad prices, the sugar factories do not even allow each other the loss. In that respect, they look like farmers again.
Subscriber
Leo 12 April 2020
Half of it is dry, so what are you worried about
Narcos 12 April 2020
Most sugar has already been sold, for reasonable prices, whether it will actually be purchased is another story.
Sugar can be stored and things always turn out differently than expected.

Subscriber
juun 12 April 2020
I'm not going to irrigate my beets that can never be done with those crap prices then but no llb grown full
insane 12 April 2020
What a weak display of Aviko, tent of millions!
Keep your back straight, roll up your sleeves and go full throttle and don't whine in the media like that new CEO. Better shut up.
Gwoon 12 April 2020
@ pole completely agree .. not made the best investments in the past .. see sales factories in Germany ....
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