BB 10 years Just call
'Protectionism major concern for onion sector'
Boerenbusiness exists 10 years. As part of this anniversary, we look back and look forward to important events in the sector. Which developments play a major role in the sector and what should we prepare for in the coming years? Today a conversation with Gijsbrecht Gunter, chairman of the Holland Onion Association (HOA).
A year like this has never happened before. This mainly caused uncertainty, also in the onion sector. Nevertheless, it seems that the onion market has not been hit as hard by the corona crisis as other agricultural markets at first. HOA chairman Gijsbrecht Gunter endorses this: "The old season was not affected much by the corona crisis, sales even increased. However, we are now noticing some problems, especially in the practical area."
2020 is a challenging year for the agricultural sector due to the corona crisis. What impact has this had on the onion sector?
"In the onion sector, we can divide the consequences of the corona crisis into 2 periods. In the first period of the crisis, which resulted in the lockdown, the sector hardly noticed this. There was even more sales, which has translated into an export record of 1,2 million tons. In recent months, however, we have seen that export flows from regions such as Asia and South America to Europe are declining as a result of the virus. This has consequences for the availability and price of the return transport. We usually use those empty containers and now it is difficult to obtain enough and at an attractive price. In addition, local exchange offices are closed in some areas, causing the dollar flow to dry up and doing business less smoothly. These are all practical matters that make trade somewhat more difficult now."
"And what also plays a role, of course, is uncertainty. Not only in the field of the corona crisis, but also around the brexit† If a product is sold worldwide, it is important that you have certainty in all sales areas. That is now under pressure. I am concerned about these developments. In general, I am positive about the future, but sales must remain broad in order to provide a solid basis for healthy trade. This caution is also reflected in processors and exporters."
If we go further back in time and look at the past 10 years. Which events and/or circumstances have had a major influence on the onion sector?
"The fact that the export has grown strongly has certainly had an influence on the sector. It is positive that we now send the onions to 140 countries and every year more countries are added. Last year, for example, India was struggling with crop failures and normally is a competitor. We are continuously working on new markets and I think it is nice to see how members manage this individually or collectively. The acreage in the Netherlands is also increasing further. So you see that in recent years farmers increasingly favor "It is also good to see that as a sector we have been able to find each other better, so that we now really work together in certain projects, such as the MH extension, CBS harvest estimate and Uireka projects."
"On the other hand, I am a bit concerned about the growing trade protectionism. For example, Russia suddenly fell out of business due to a counteraction to European sanctions, so that onion exports still pay the price to this day. Opening the market in China is also a matter of the whole long breath. The order in that country is pears, peppers, tomatoes and then onions. At the moment the 'tomatoes' file is still ongoing, so we have to be patient, or perhaps priority should be given to onions if that is more likely Even within Europe, trade protectionism is becoming more and more visible. To what extent does Northern Europe help southern Europe to keep the economy and thus European trade and common currency alive? Nationalist sentiment continues to rise, while trade actually benefits from open borders."
"This is also revived from the House of Representatives. About 8% of onions worldwide are exported. This means that 92% is for the local market (local-for-local). However, a number of parties in the House of Representatives wonder aloud. or we should continue to carry food around. In my view, however, food is not carried around as much as is sometimes politically assumed. And you can only grow Dutch long-day onions in the narrow region between Denmark and Paris because of the day length and climate. is therefore excellent for export. Take Senegal as an example: when a country has its own production (so-called short-day onions that have a short shelf life), we are not active. Clear agreements are made about this. We respond to local shortages and only then come up with turn on the Dutch onion there."
Which developments do you expect to have a major impact on the sector in the coming years?
"At the moment, the global production amounts to about 90 million tons, with a demand from 7,2 billion people. If the world population grows to 2050 billion people in 10 and they eat an average of 15 kilos of onions per capita, then you will need 150 million tons of onions, which is 60% more than now.So there is great market potential, but the question is: where do all those onions come from?I hope from the Netherlands, of course, but that is not realistic. Here too we are reaching a maximum."
"The theme of trade protectionism returns here. There will always be gaps to be filled in the global market, especially with increasing crop failures as a result of climate change. India and Brazil were prime examples of this last season. The question is whether we can continue to supply those onions "Trade used to be limited by import tariffs, but we Dutch were able to deal with this well. Now you see that the instruments to stop imports, and therefore also the Dutch onion, are used much more widely. Think, for example, of barriers in the field of food safety. , residues and phytosanitary restrictions. That is something that worries me, partly because the reason is increasingly political rather than on rational grounds. If Brazil and/or India have a crop failure as a result of extreme rainfall, then just ship our beautiful product there so the locals have food."
If we look specifically at limiting the use of crop protection products. Do you expect more problems with that in the future?
"Yes, absolutely. In the long term we certainly see a future without chemicals, but this is really in the long term. We have already made great strides, but at the moment many resources are simply indispensable to offer growers sufficient security. The package of resources specifically for onion cultivation is being thinned out at a rapid pace and there are simply no alternatives for some resources. An example is the ban on seed coating. With seed coating you apply a few grams of active substance per hectare underground, but if you use full fields as an alternative "If you have to spray, you quickly use kilograms and you also spray into the air. Seed coating is, in my opinion, a great form of precision agriculture. The result of the ban is that more active substances are used per hectare."
"Don't get me wrong; we really want to move towards onion cultivation in the future without the chemistry of yesterday and today, but a lot of research is still needed for that. we can generate returns that will allow us to remain competitive in the global market.Obviously there are niches for organic products or specialties, but in order to continue to play our part in global trade, we need to be supported by clear and facilitating policies, not by delusion of the day or political sentiment."
What are the opportunities and challenges for the onion grower?
"There is a chance that in the future more onions will be needed to provide the world population with onions. So cultivation will not disappear. The biggest challenge is the fact that in a growing number of places in the Netherlands we are dealing with a freshwater system that is not geared to the needs of the crops and that the pressure from fungi (such as fusarium) and insects is increasing. cultivation systems and that is why we at Uireka are fully committed to this. It is becoming necessary to grow resilient crops. We must investigate which crops can and cannot be placed together and perhaps we should even look at strip cultivation. The national onion day in Colijnsplaat will therefore remain valuable. I was positively surprised about the results of a number of trials. In some trials, an extra 25 tons were obtained from 1 hectare."
After all, where do the opportunities and challenges lie for the onion trade?
"Of course, the aforementioned market perspective remains that in the future 60% more onions will be needed to meet the demand. The total world export has grown from 6% to 8% in recent years. Suppose this grows to 9% and the Netherlands still supplies 20% of that, then you are talking about 2,7 million tons and you can say that the future looks rosy.However, as mentioned before, these onions cannot all come from Dutch soil, but mainly via the logistics hub pass through the Netherlands."
"You can also see the limited quantity of Dutch onions as an advantage: Dutch onions then become a kind of limited edition. In my opinion, we have sold these Dutch onions too much as a commodity in recent years, while we can distinguish ourselves very well in terms of quality. Creating a 'Holland label' and thereby marketing our product well may be an option. There is still much to be achieved in the field of truly distinctive added value in the future."
Kimberly Baker
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