Energy prices will heavily impact greenhouse production

According to a recent study, rising gas and electricity prices will weigh heavily on the profitability of Dutch companies. The greenhouse production sector seems to be one of the sectors that will be most impacted, because energy represents 20 to 30% of the costs.

 

The study conducted by ABN Amro predicts that rising energy prices will cost Dutch companies around 22 billion euros (25 billion USD) this year. Among the most impacted sectors: greenhouse production whose annual turnover reaches around 8 billion euros but where energy represents 20 to 30% of the costs.

 

Some Dutch professionals have opted for lower lighting or lower temperatures, others for crops on a partial surface of their greenhouses. Most professionals continue their activities but already 40% of the members of the Glastuinbouw Nederland group are operating at a loss, due to excessive energy costs.

 

According to the study, gas and electricity prices jumped almost 5 times their 2019 levels, after Russia invaded Ukraine. Uncertainty remains regarding the resupply of gas to storage sites during the summer, which adds concern for the following months.

 

With regard to total agricultural production in the Netherlands, ABN Amro expects a decrease of 2% in 2022 compared to the previous year.

 

The ABN Amro study indicates that greenhouse production companies, chemical companies, construction companies and paper companies are the most exposed to the impacts of energy price increases.

 

source : reuters com