'Clearly more interest in starch potato cultivation'

In the interview a year ago, CEO Bert Jansen said that normal years no longer exist. Persistent drought has caused the (financial) results per grower to vary widely in 2018 and 2019. It is less important in 2020, although there are also growers in this campaign who harvest significantly less due to frost in May and drought in August. Growers in East Germany have had a more positive growing season.

CEO Jansen leaves
A combination of a demand market for vegetable protein, the market position of Solanic potato protein and significant investment plans ensures that the company looks positively to the future. Jansen will no longer experience this future within the ranks of Avebe, he will stop after the current financial year and will look for a new challenge. Avebe has already started the search for a successor. "After 13 years it is time for someone else," he says. "If you stay too long, you might get stuck in your habits. It's a good time to do something different."

The CEO does not leave with a poor performance award. The result for the 2019-2020 campaign is €96,15. Only €0,48 per tonne of potatoes below the record of the previous financial year. The cooperative result is considerably higher. This increases from €5,2 to €8,7 million and is therefore at a level that we are used to. "Unlike the previous campaign, we do not pay out the full result to the members," Jansen explains. "We follow the rules and pay out 40% of the cooperative result. The rest goes to equity, bringing the solvency to 42%. This is necessary because we will invest significantly more in the coming years."

Investment level to €60 million in coming years
Last year, Avebe reserved approximately €45 million for investments. This amount will go to €60 million for the coming years, "to give innovation more momentum", as Jansen himself says. "We require a balance that matches this. The innovation program includes 3 spearheads: The expansion of the Solanic production capacity in Gasselternijveen, the extraction of protein at our German factory in Dallmin (between Hamburg and Berlin, ed.) and an investment in the location Ter Apelkanaal. We produce industrial specialties in Foxhol. The factory in Ter Apelkanaal will soon focus entirely on starch products for food and the derivatives will go to Foxhol. The German factory is the only one where no protein has yet been extracted from the amniotic fluid. That will change next year .

Avebe has good reasons to invest heavily. The demand for vegetable protein is booming. Jansen: "On the one hand, the corona crisis has meant that we sell fewer raw materials to the food service channel, such as starch as an ingredient for chip coatings. Especially in Asia. On the other hand, a large increase is noticeable in the convenience market. Think of noodles and pizzas. This results in a strong demand market with good prices. Fortunately, the market situation has improved in Asia. Many countries there have undergone a second lockdown. China, Korea and Japan are accessible to us again. India and Indonesia still have restrictions, but there Avebe less active."

Meat and dairy substitutes
Even without the corona crisis, Jansen has enough indications that the demand for potato protein will remain high in the coming years. "For example, it replaces chicken protein in meat substitutes and milk protein or gelatin in dairy substitutes. These segments are also seeing a plus in consumption due to the corona crisis. The question is whether that trend will continue. It is difficult to predict, but it is clear that the market is positive. Our Solanic protein has very good functionality and a high nutritional value. We really have something special with that."

Avebe also feels the situation on the chip potato market. Last campaign it received approximately 10% less volume. Couldn't this hole have been filled with French fries? "No," Jansen says firmly. "We put the collective interests of our members first and want to achieve a good performance price. The situation on the market changed last spring at the end of our campaign. Chip potatoes have a low starch content, which makes them less interesting for us and offers little added value. " That's why he sticks with it statement of March. "We see that some members supply French fries potatoes within their contract space. We apply a heavy price reduction for the low return due to the starch content. Growers apparently accept the lower price."

More demand for shares
Chip potato cultivation in the Northeast has grown significantly in the last 10 years. Jansen sees a change. "In 2018, the performance award took a significant step. 2019 is also in line with the ambition. We are the stable factor in the area. This suits many growers well. We see that interest in starch cultivation is growing and Avebe is also active there. shares are needed. Interest in this is also increasing."

Jansen emphasizes that the current price does not cover costs for all growers. "Some of the members have had 2 very mediocre harvests. The ambition remains a higher price. This can be done by converting all the protein into food protein. Amniotic fluid contains 1,5% protein. It is an expensive process that requires high investments Breeding company Averis is continuously working on cultivation optimization: varieties that yield more kilos with less input of nitrogen and crop protection products. That is an advantage for the farmer and makes cultivation more sustainable. Crispr-Cas can accelerate this process enormously. We would prefer to see the breeding technique quickly approved. By saving CO2 we reduce our footprint and save costs for growers. Through frequent irrigation we focus on saving water, because scarcity is lurking. We hope to be able to respond better through trials with, among other things, robust varieties and drip irrigation. respond to dry periods and reduce water requirements."

No volumes but specialties
Jansen may be leaving the group, but he is not lacking in vision. "Avebe wants to supply clean label starch derivatives. This means that we modify the starch without chemicals and that there are no E numbers attached to the product. The market demands this specialty. Our name guarantees quality. In Asia, for example, customers respond positively. on the designation 'royal'. This stands for tradition and reliability. Certainty of quality and certainty of delivery. The Netherlands is not a country of commodities. Feed the world is not done via the volume knob, but with specialties: products with added value. Avebe has plans for another 30 years to achieve this."