Interview Van Loon & Van Ballegooijen
Van Loon Group wants to distribute margin in the chain fairly
After a long career at the top of the dairy sector, Robert van Ballegooijen (right) opted last year for a switch to meat. He has now been CEO at Van Loon Group for three quarters of a year, which has experienced rapid growth in recent years. In addition to Van Ballegooijen, Roland van Loon joined us for an interview. Together they are now working to implement the company's strategy. The rise of meat substitutes is closely monitored, but meat remains the core business.
Van Ballegooijen is now fully established at Van Loon Group. The differences between meat and the dairy sector? "There are certainly differences, but I actually see more parallels. Just like at A-ware, we produce animal proteins here and we think in terms of chains. Both sectors also face overlapping sustainability issues."
A difference between meat and dairy, according to Van Ballegooijen, is that livestock farmers traditionally have a stronger bond with the dairy factory than with a slaughterhouse. "This point is in development, because we are emphatically looking for our livestock farmers and are working on sustainability." After nine months at Van Loon Group, the CEO believes that the meat markets are more volatile and also more complex than the dairy markets. The latter is mainly due to the square value of the pig or cow. "The margins are thin, so it is important to maximize the value of all parts of the animal. Only then can we keep sustainability affordable. We cannot afford to make mistakes here, although that was no different in the dairy sector."
Roland van Loon has been familiar with the meat world from an early age. His father started as a local catering butcher more than fifty years ago and he joined the business in the early 90s. In the past ten years in particular, the company has experienced rapid growth as a result of various acquisitions. In 2022, turnover will reach the €1 billion mark. The focus has broadened in recent years to convenience and meat substitutes, 'but our core business is meat', emphasizes Van Loon. The expansion was a conscious choice. "We are an ambitious company that wants to grow, the consumption of meat will decrease somewhat in the coming years. Meat substitutes and ready-made meals are an extension of meat."
Distribute margin fairly in the chain
At Van Loon Group, they emphatically see themselves as chain directors. So not so much producing meat and pushing it into the market, but responding to the customer's wishes and moving along with the consumer. The concept of 'Pig at its Best' was introduced in 2020. All pigs (approximately 1 million per year) from Van Loon Group that are processed fall under this programme. "We are able to respond quickly to trends. For example, with soy-free pig feed," explains Van Loon. Van Ballegooijen adds: "The challenge is to fulfill social wishes with regard to animal welfare, climate and the environment, while at the same time remaining affordable for the consumer and supporting a good revenue model for the farmer. Ultimately, a chain is only truly sustainable when each link has a can make a good return. We are able to oversee the chain from A to Z, in order to subsequently arrive at a good distribution of the chain margin together with chain partners. This sounds easier than it seems, because the additional price must be paid on the domestic market be earned back. Foreign buyers are not willing to pay extra for sustainability measures in the Netherlands. This applies not only to the Chinese or Japanese, but also to buyers in Europe. In that respect, it would be better if the regulations in the Netherlands were more in line with the regulations in the surrounding countries."
The
Robert van Ballegooijen
According to the company, the pig farmers participating in Varken op z'n Best are enthusiastic about the programme. There is a waiting list to participate and so far no pig farmer has left. "We have invested a lot in pilots in recent years, which we can now roll out to retail and food service. That is the advantage of a family business without external shareholders who want as much return as possible," says Van Loon. A waiting list of pig farmers in a shrinking market sounds like a luxury problem and they find that somewhere at Van Loon Group itself. In any case, it enables the company to continue to think in terms of growth. Meals producer Maître from Oude Tonge was taken over just a month ago. "We don't grow to grow, we only make an acquisition if it accelerates our strategy," says Van Ballegooijen, who expects consolidation in the food sector to continue. "The combination of processing meat and preparing ready-made meals reinforces each other enormously." In the coming years, Van Loon Group will therefore continue to look for acquisitions, in which the Benelux will initially be the playing field.
Meat 0.0
Van Loon Group has been active in meat substitutes for a number of years. In 2021 they started a new company for this in Almere: No Meat Today Company. Internally they also call meat substitutes 'meat 0.0', as a nod to non-alcoholic beer. "The rise started as a hype, but the market is now maturing," says Van Ballegooijen. "The first generation of meat substitutes was not good enough. Not in terms of taste, sustainability, health and price". However, the market is developing rapidly. "A startup comes here almost every week to pitch a vegetable raw material. We emphatically follow the market and move along with it. Just like a pig, beef or chicken, we see vegetable proteins as a raw material to make beautiful products. Taste is the most important thing, because otherwise consumers won't buy it, but so will nutritional value and affordability." At Van Loon Group, they find this new world particularly fascinating, although they do think that the rise of meat substitutes is much slower than is often thought.
Dynamic times
In a conversation with Van Loon and Van Ballegooijen, meat and meat substitutes are mixed up. With the effect of high inflation, we automatically return to meat. Prices for beef and pork have gone through the ceiling, says Van Loon. "In that respect, these are dynamic times. For the consumer, the stretch has now run out, which is clearly reflected in the drop in demand for the more luxurious parts. At the same time, supply will remain tight." Van Ballegooijen does not think that the high carcass prices are automatically the new reality. "If the market turns, things can go very fast. We see this happening in dairy and the gas market, for example."
Roland VanLoon
In all the hectic pace of the meat markets, the trick is to keep looking ahead. Sustainability in particular has our full attention, says Van Loon, who shapes this theme from his position as CTO. Our new CSR annual report has recently been published. Van Loon Group is averse to this greenwashing, but goes for concrete measures. They are the first in the sector to participate in the Science Based Targets Initiative (SBTi). These are scientifically substantiated climate goals, with which you as a company contribute to the Paris climate agreement. "This is not free, but we invest in the future."
At the end of the day, Van Loon Group works on its raison d'être and support. In that respect, too, these are dynamic times. Take the lobby against meat and the political uncertainty. "The gap between The Hague and the rest of the Netherlands is large," says Van Loon. "Interests vary widely, but in the end everyone benefits from clarity. We also experience the frustration that farmers feel." Rehabilitating livestock is not without risk. "The Dutch knowledge economy can only flourish if there is an industry underneath it. Hopefully this awareness will subside", both gentlemen conclude.
Wouter Job
© DCA Market Intelligence. This market information is subject to copyright. It is not permitted to reproduce, distribute, disseminate or make the content available to third parties for compensation, in any form, without the express written permission of DCA Market Intelligence.
