China offers EU flax sector a bright future

A rising demand for fiber flax from Asia offers prospects for the European flax sector. Improving relations with Chinese textile producers is bearing fruit. Flax has had favorable years in terms of price. The prospects for the future are also good.

The message from the European flax industry was clear last year: 'The financial return from flax cultivation is at a profitable level.' Demand and supply must therefore remain in balance. Vlas en Hennep.NL, the association for the Dutch flax and hemp sector, does expect an increase in acreage in the EU for 2017. Can the market handle that? Boerenbusiness asked David Kasse, secretary of Vlas and Hennep.NL.

Both the French flax organization (Cipalin) and the cooperating flax organizations (CELC) insist on balancing flax cultivation. Has this advice been ignored?
'It is true that the flax industry advocates a market that is in balance. When we look at the sales of seed, it is likely that an area expansion in Western Europe will take place in 2017. In the 2016/2017 marketing year, the production of long flax fibers, from June 2016 to January 2017, was 10 percent higher than in the previous year. Sales were also 10 percent higher. Supply and demand are in balance. As a result, a slight increase in area does not immediately lead to an imbalance in the market. Last year, 2.415 hectares of fiber flax were grown in the Netherlands. In France 88.900 hectares and Belgium 15.500 hectares. I do not expect a large increase for the Netherlands in 2017.'

Are Dutch arable farmers interested in growing flax or does it have a lot of competition from other crops?
'In our country there is little scope for expansion. This is partly due to competition from other crops and partly due to the availability of suitable land. Flax thrives best within a crop plan with not too many harvesting fruits. About 80 percent of our flax is declared to the NAK for seed inspection. Our country has 3 breeding companies and I estimate that more than half of all seed in Europe consists of Dutch varieties. Seed propagation in the Netherlands is the best way to keep cultivation profitable. In Belgium and France, the seed is mainly used for animal feed or consumption. It is easier to scale up in surface area, especially in France, because growers specialize in flax and have their own mechanization. In addition, there is greater availability of land and access to larger plots.'

The press release describes that fiber prices are at a good level. Will the contract price for the grower also increase?
Flax cultivation takes place in various ways: cultivation for a fixed price per hectare, contracts on a kilo basis, participation contracts or free cultivation. As it looks now, prices will remain stable for a while. However, it is not possible to make a prediction for the next sales season. The quality of the 2016 harvest was lower than that of 2015. As a result, lower prices have to be accepted for some types of flax. For 'homogeneous and well-rotted' lots, prices in the first 7 months of the 2016-2017 marketing year, July 2016 to January 2017, were between 1,90 euros and 2,40 euros per kilo. For batches with quality defects, at least 30 percent of the total supply, that is 1,25 to 1,90 euros per kilo. A declining price is noticeable in the sale of short fibres, which is partly related to quality. This means that more short fiber is in stock, but that picture is not alarming.'

China is an important partner of the European flax industry. Is there no fear that the country will meet its own needs with local cultivation?
'Flax is already grown in China. We see that the spinning and weaving mills have undergone major innovations and are making high demands on flax fibres. Cultivation has actually lagged behind. The focus in China is on food production. In addition, the cultivation of fiber flax requires expensive and specialist machinery. Almost 80 percent of EU long flax fiber production is exported to China. The rest of the Chinese need is covered by our own production and by countries such as Belarus and Egypt. The market in Asia offers prospects for strengthening sales. The international flax and hemp organization CELC therefore focuses on strengthening relationships with the Chinese textile industry. The label European Flax is also promoted. This should improve the recognisability and traceability of European flax fibres.'

Fiber hemp is also mentioned in the press release. Is the future for this crop just as positive?
'The sale of fiber hemp is mainly aimed at industrial applications. For example for the car industry or the production of insulation material. The textile world is very interested in processing hemp fiber as an alternative to cotton. That is technically difficult. The real breakthrough has yet to take place. If that becomes reality, hemp cultivation can take the next step. The Dutch acreage for fiber hemp is currently approximately 2.000 hectares. Fiber hemp scores in a number of areas. For example, no chemical crop protection is required. The crop has hardly any diseases and weeds do not play a role. The water requirement is also less compared to cotton. The third plus is that, just like with flax, you can 'unlock' the fiber via a mechanical process. No chemicals are needed for this. Cultivation is up and running, now the trick is to tap into new markets for growth.'

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.

n.vanderboom@boerenbusiness. Nl

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