BelOrta surpasses the 500 million mark for the first time

Market turnover masks uncertainties and challenges for growers

The significant impact of rising costs such as energy, labor, and raw materials has consequences on the production of BelOrta growers that should not be underestimated. Growers often need to plan well in advance when it comes to sowing, planting, harvesting, or storing hard fruit. Such planning certainly involves high risks, especially in uncertain and volatile times. In addition to production uncertainty, we also saw changes in consumer shopping baskets due to unprecedented inflation and decreased purchasing power.

Production of fruit vegetables strongly influenced by increased energy costs

In a normal season, we could speak of decent prices for many types of tomatoes. However, the rising costs of energy and raw materials have a large impact on the profitability of many growers and crops. Moreover, it was noticeable that many specialty vegetables struggled more than the traditional types. The reduction in purchasing power seems to mainly affect products with higher (per kilo) prices.

The cucumber production (both locally and abroad) decreased significantly compared to last year, resulting in a higher average price. Eggplants experienced a difficult start to the season but benefited from a better second half of the year, while peppers had a rather volatile season with slightly lower results compared to last year. Higher energy costs not only have a direct impact on production but also make growing fruit vegetables much more difficult, especially at lower temperature settings.

In certain other vegetables, we notice a revival of horeca and foodservice sectors after two COVID-affected years. This is reflected, among other things, in the demand for specific asparagus varieties. Nevertheless, unpredictable weather caused a turbulent asparagus season with a good start, followed by a very weak month of May and a somewhat better seasonal end in June. We saw a similar pattern with many leafy greens: a good start, a weak middle, and a better season end.

Leeks had a year with two sides. The growing season of 2021 proceeded smoothly and resulted in high yields per kilo. Combined with a mild winter, this led to low prices in the first half of 2022. The dry and warm summer of 2022 negatively impacted production and supply, causing the market to revive somewhat in the fall. Cauliflower experienced a year of ups and downs both in supply and price formation, resulting in an below-average annual midpoint price.

The Belgium endive market was very poor from January until mid-August. The market recovery after this period unfortunately could not make up for the damage suffered. Purchasing power, energy, the international market situation, and increasingly rapid emerging, changing, and disappearing consumption trends have been factors that defined the success or failure of products over the past year.

Soft Fruit and Stone Fruit – Better Summer Than 2021

The start of the season for strawberries was solid on a commercial level. However, from mid-April, it quickly declined, and this lasted for more than a month. The convergence of a large volume of production both domestically and abroad led to a temporary explosion of supply, which was of course very detrimental to market prices. After this period, supply and demand balanced out again, and prices improved.

In terms of quality, 2022 was a much better soft fruit year than 2021, which was plagued by an extremely wet summer. The balance between supply and demand was reasonably well maintained during the Belgian season, resulting in relatively stable pricing. Cherry production returned to normal figures—a welcome development after the very difficult 2021 season. Thanks to central hydro-cooling and sorting, work could be very flexible in terms of varieties and packaging, both strong advantages for smooth marketing.

Notably, in 2022, the further development of recently launched concept products BelOplum (plums) and BelOmelon (melons) took place. Both projects are very warmly received by growers, traders, and consumers. Local sustainable cultivation is clearly appreciated. In 2023, we will continue on this path.

Storage costs for hard fruit are increasing sharply – Conference solidifies position

The past hard fruit season was a challenge, and not only due to the large volumes of hard fruit harvested across Europe. The significantly increased storage costs cause products to be sold more quickly and consequently offered less spread out. This is, of course, detrimental to price formation. Additionally, the war in Ukraine and high transportation costs also impact our exports. However, it is not all doom and gloom in the hard fruit sector. Our Conference pears maintain their good quality reputation and are finding more and more new final destinations. Moreover, existing markets are growing.

As for apples, we had a difficult year due to the oversupply in Europe. During last autumn's harvest, many batches were immediately offered for sale because of high storage costs. This put significant pressure on the market. Lower European stocks at the end of 2022 give us hope for improvement at the beginning of 2023.

Impact of Purchasing Power Decline on Organic Vegetables and Fruits

Just like with some specialty and convenience products, we also notice a significant inflation impact on organic products. Certain casual organic buyers more frequently opt for a cheaper alternative, which is reflected in sales figures. However, there was also positive news in the organic sector. The warm weather of last summer positively influenced the quality of our organic soft fruits, which benefited sales and consumption, especially compared to the very wet 2021.

The drought often also affects the sizes of many vegetable and fruit varieties. Smaller sizes often lead to a lower supply. In an inflationary year like 2022, this unfortunately does not always translate into better pricing, even though it is necessary for the profitability of organic producers. However, at the end of 2022, we did observe some improvement in demand, and we hope to continue this momentum in 2023.

The rollout of the CO2 reduction plan fits within the pursuit of more sustainable production and trade

In early October, we published our annual sustainability report. Steadily and with results, we continue to work on themes related to partnership with growers, reducing the ecological footprint, caring for people and society, and attention to natural and healthy products. BelOrta has proudly called itself an SDG Pioneer of the UN for several years. An honor given only to companies that achieve significant results in sustainability goals. But that doesn't mean we rest on our laurels. We are fully committed to reducing our CO2 emissions by 42% by 2030 (compared to 2020). This plan has been confirmed and approved by SBTi (Science Based Targets initiative), making BelOrta part of a select group of Belgian companies that have already set clear targets in this area.

BelOrta Celebrates Its 10th Anniversary and Builds for the Future

In 2023, BelOrta celebrates its tenth anniversary. Of course, we will take a moment to reflect on this first milestone. However, our focus is on the future. Over the past 10 years, our cooperation has faced numerous challenges. As if vegetable and fruit cultivation, with all its unpredictable weather conditions and increasingly strict legislation, was not challenging enough, in 2014 we were hit with a heavy ban on Russian imports. This resulted in the loss of a costly sales market for our apples and pears, but also for many types of vegetables. The Brexit, the COVID-19 crisis, and more recently the global energy crisis and soaring inflation have also made the journey bumpy.

Political posturing, often with poorly nuanced regulations, harms the hard work of our producers. For example, the constantly changing packaging laws, the debates over MAP7, and the impacts of the nitrogen verdict on the development prospects of horticultural businesses. Producing healthy food is not a given, and authorities and other responsible parties should be more aware of this. Food production should not be used as political leverage. It is a daily effort by many passionate and proud family businesses.

That BelOrta continues to believe in the future and wants to take responsibility in the pursuit and realization of a livable income for its cooperative growers is demonstrated by the declaration of intent signed in early February 2022 with the Belgian Fruit Auction. By the end of 2022, negotiations were completed and sealed in a legal agreement. It is expected that by mid-2023, the Belgian Competition Authority will give its final approval, with the aim of achieving full operational integration by July 1, 2023. Over the coming weeks, appropriate communication will be carried out to serve the involved growers, employees, and customers.

As a cooperative of more than 900 growers, or better 1300 growers after integration with BFV, BelOrta is eager to rise to the challenge and looks forward with great enthusiasm. We are convinced that collaboration pays off and that everyone along the chain from field to plate reaps the benefits. In the coming year, our proud BelOrta growers will once again dedicate themselves to providing the most delicious, high-quality vegetables and the juiciest fruit every day. Locally grown, freshly picked, full of flavor, and surprisingly fun for everyone at the table.