The Dutch horticulture industry thrives in an international context. Recently published exploratory scenarios also point to potential worlds in which national and even regional sentiments become dominant. The COVID-19 pandemic is likely to accelerate these trends. This article discusses opportunities for Dutch horticulture in the rapidly changing international context.

It is assumed that COVID-19 and subsequent events and measures make it much more difficult and costly to do business internationally
COVID-19 and the reactions to it immediately impacted the horticulture industry in the Netherlands. Closing shops, borders and restaurants worldwide led to a tremendous reduction in demand for horticulture products. The Dutch Greenports organisation responded adequately by addressing issues with regard to logistics, labour and finance. But they also realised the pandemic’s potential impact in the long run.

At the request of Greenports, a core team of horticulture professionals and scientists combined their efforts in analysing the Dutch horticulture sector and drafted four different exploratory scenarios based on the most severe uncertainties expressed by leading entrepreneurs in the Dutch horticulture sector (including starting materials, edible products, floriculture, technical suppliers and services). Recently, the website (with tooling and the reports) was made public (available in Dutch here).

This publication deals with these scenarios in an international context. It elaborates on the risks, opportunities and challenges for the Dutch horticulture industry in this context. A subsequent publication will address the chances and opportunities in this area specifically for The Netherlands and the African continent, more specifically sub-Sahara Africa (SSA).

The Dutch horticulture industry in international context: four possible futures with different impacts
In the scenario report, two main clusters of uncertainties are combined in the axes: ‘Global versus Local’ and ‘We versus I’.

On the ‘Global vs. Local’ axis, we see that for both “Local” worlds, it is assumed that COVID-19 and subsequent events and measures will make it much more difficult and costly to do business internationally, compared to the previous ten years. On the other hand, the “We v.s. I” axis relates to the citizens/consumer preferences with regards to the society they wish to live in and the way government authorities (at all levels) deal with that. After all, in these scenarios, we see a rather long global recession, a disintegrating European Union, increased protectionism, shrinking horticultural production in The Netherlands, the need for short regional value chains and a decline in purchasing power.

Other countries seek Dutch expertise to improve local production and yields
The importance of exports for the Dutch horticulture industry in both seeds, fruits and vegetables, as well as with trees, plants, bulbs, flowers and related technical solutions, knowledge and services is well documented. European markets are by far the main export destination of vegetables, plants and flowers.

The “Global” oriented worlds
In the short term, the Dutch horticultural industry will be best served by a quick recovery and a gradual growth of global trade and investment opportunities. This will allow for logistics to be restored and expanded, as well as an opportunity for knowledge and labour to be exchanged freely and internationally. With strong free trade and level playing fields, Dutch horticulture companies are well-positioned to benefit from the strong elements of the Dutch industry, such as high yield, healthy and nutritious food for affordable prices, sustainable production and well connected/integrated value-chain. From a market perspective, the “global” oriented worlds bring a number of changes for enterprises, and it can be argued that from an international business perspective, the impact of a move towards more “local” market is much more substantial and threatening than a move towards more “global” worlds.

The “Local” oriented worlds
It is obvious that in both local oriented worlds, the I/Local (“National business ventures”) and the We/Local (“Regional cooperation”), export volumes will drop substantially. And so will imports. Tropical vegetables and fruits, young plants and flowers from (sub)tropical areas and even coffee, cacao and tea will loose market share. There is a clear threat for companies which heavily rely on export in their business model. Dutch companies producing for domestic markets will have to face exporters who try to substitute export markets for domestic markets. We have now seen some of the threats of a world dominated by local trends, but what opportunities remain and will emerge for the Dutch horticulture cluster in future locally oriented worlds? For that, we have to distinguish the “I/Local” world from the “We/Local” world.

There is a clear threat for companies which heavily rely on export in their business model
Opportunities in an “I/Local” world: National Business Ventures
In the “I/Local” world, governments protect their markets and companies operate on a national basis in a local-oriented world in which a slowdown in innovation takes place. Exports of horticultural products will reduce substantially. For growers, opportunities exist (e.g. via joint ventures) in setting-up production locations in different countries, especially European countries, and other continents, thereby providing opportunities. Alternatives are to broaden the product base or to step into other opportunities outside the traditional horticulture sphere, such as seaweeds or insects. For the seed industry, opportunities arise in Africa and Asia in setting-up joint ventures and developing climate resistant or regionally-popular varieties and products with health claims for vulnerable elderly people.

As a matter of fact, other countries seek Dutch expertise to improve local production and yields. They are willing to pay for Dutch expertise to optimise (protected) cultivation. Also, opportunities exist for companies in greenhouse construction and horti-technology to set up production locations for the protected cultivation of horticulture products in other countries, especially if suitable solutions can be provided for specific local and regional circumstances.

Opportunities in a “We/Local” world: Regional Cooperation
For the “We/Local” world, aspects like safe, sustainable and healthy food are important. Furthermore, it implies that in this type of “engineered society,” pure local for local production and circular and integrated solutions become dominant.

Another direction is to set up joint ventures in providing city systems with full service supply of food and wellbeing services
For growers, opportunities arise for broadening the product base of both traditionally grown, as well as the local varieties of products, which used to be imported from other continents. Traditional growers focus more on small-scale organic production using subsidized labour and providing a broad range of products, sold at the farm-gate. Another direction is to set up joint ventures in providing city systems with full service supply of food and wellbeing services. This will definitely require tailor-made solutions both from growers and suppliers to provide for sustainable production. These concepts can be introduced in other urbanized countries as well. Seed propagation companies focus more on product development for biological and organically grown products, which benefit health and can be sold in international markets. More so, for full service concepts, maintenance and replacement against a service fee could gain traction. Opportunities to design and build vertical farming solutions near cities arise, with more autonomous greenhouses, production and harvesting automatically by robots. And all these concepts can also be sold to other cities, especially in Asian countries.

Concluding Thoughts
There is only one certainty: entrepreneurs in horticulture will have to adapt and change their businesses in order to survive. Although the scenarios projects horticulture output in the Netherlands will shrink (in the “I/Local” world, the number of Dutch horticulture companies will reduce; in the “We/Local” world, the horticulture volume from individual companies will on average decrease), exporting - for example - skills to grow crops abroad offer opportunities for growth in new ways. So do new crops grown locally for European markets. To realise them, horticulture entrepreneurs must have foresight, guts and financial strength to timely anticipate and act on the constantly changing context of their markets.