Dutch bell pepper exports to North America bearing the brunt of high airfreight fees

Marcel van der Pluijm, Feeling Fresh: “Dutch bell pepper exports to North America bearing the brunt of high airfreight fees”

An unfavorable dollar exchange, increased local production, or an overbearing president. Marcel van der Pluijm anticipated many scenarios when he founded Feeling Fresh in October 2019. A global pandemic was not one of them. As a result, airfreight has increased by a massive 100 to 200%. That is causing the necessary challenges. "We're currently taking a beating, but things are sure to improve," begins the Dutch trader defiantly. He exports to America.

The Dutch greenhouse vegetable season is slowly getting started at Feeling Fresh. "We were still in between two seasons [at the beginning of April]. The Spanish season ended earlier than usual. That was partly due to the weather conditions in January. The cold front caused quality issues for many companies in Almeria. So, we stopped earlier than usual." Marcel buys his product from various grower cooperatives and individual growers.

Dutch bell peppers - by far, Feeling Fresh's top export product - are expensive. These high prices aren't making it easy to export to distant destinations at the moment. "Before Easter, a box of Dutch bell peppers cost between €22 and €27. With the current air freight rates, you are talking around $45 for our American customers. While the Mexican growers deliver them across the border for $10. The past year's dollar exchange rate has been quite erratic too. It started at around $1.08 and rose to $1.23. That made us even more expensive for American importers. The dollar is now getting stronger again. Our competitive position is, therefore, improving," explains Marcel.

LEARNING MOMENTS

"So, we're currently waiting until Dutch bell peppers become cheaper. We've been dealing with sky-high air freight tariffs for 13 months now. That is why, last year, the Netherlands 'only' exported eight million kgs of bell peppers to the United States. The year before, it was double that. I don't foresee much improvement for this season either. But we are trying to get through the situation as best we can. We will keep on fighting, and above all, it is vital to keep on enjoying the profession. These are learning moments that every businessperson goes through. The trick is to come out of it stronger."

"I'm an opportunist who finds opportunities in everything. These unpredictable circumstances are, however, sometimes disappointing. May to June are generally good months for Dutch sweet pepper exports. But it seems that this is still too soon. Other products are in the same predicament. Of course, we still export products like aubergines, bell peppers, and chicory to the North American market. But we shipped hardly any vegetables such as leeks, Brussels sprouts, and rhubarb last year. We simply couldn't compete with local producers. That was due to the high air freight rates," Marcel continues.

FILLING THE GAP

Nevertheless, he remains optimistic about his long-term prospects. "More than 20 years ago, the Netherlands was still in a

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unique position, supplying bell peppers to the North American market. With the rise of domestic cultivation, that has become more of a gap-filling function. Canadian cultivation companies have sprung up all over the country. These are not small five to ten-hectare projects either. That was with the help of Dutch greenhouse builders and suppliers."

"Also, Mexico is active on the market almost all year round. We may not regain the position we had 20 years ago. But I do think the Netherlands’ role will come back into focus. In a normal year, the Netherlands exports between 12 and 22 million kgs of bell peppers to North America. I would not have started my own company otherwise. Besides, COVID-19 has brought a lot of attention to healthy food. That also applies to America. And this country still has some catching up to do in that area," says Van der Pluijm.

For Marcel, this is reason enough to orientate himself and to broaden his scope. "That is easier said than done. I have specialized in North America since the mid-90s. Therefore, I have never really had a backup in another market. But if the situation continues like this for a long time, I might have to consider that. However, I'm convinced that the tide will turn. I'm holding on to that. There is not much point in despairing. Other businesses are affected and have been hit much harder. Just think of the hospitality, events, and travel industries. When hard times come your way, you have to grin and bear it," he concludes. (IH) 

marcel@feelingfresh.nl

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