France economy

European farmers warn of shortages due to energy crisis

Emmanuel Lefebvre produces thousands of tonnes of chicory each year on his farm in northern France, but this year he may give up growing it due to the energy costs needed to freeze the harvested bulbs.

Across northern and western Europe, vegetable growers are considering shutting down operations due to the financial hit of Europe’s energy crisis, further threatening food supplies.

Soaring electricity and gas prices will affect crops grown all winter in heated greenhouses, such as tomatoes, peppers and cucumbers, and those that need to be placed in cold storage, such as apples, onions and endives.

Endives are particularly energy intensive. Once the bulbs are harvested in the fall, they are stored at below freezing temperatures, then replanted later in temperature-controlled containers to allow year-round production.

“We are really wondering if we are going to harvest what is in the fields this winter,” Lefebvre told Reuters at the site where his endives are packaged.

European farmers warn of shortages. The expected production impact and rising prices mean supermarkets could shift to sourcing more products from warmer countries such as Morocco, Turkey, Tunisia and Egypt.

Soaring gasoline prices are the biggest cost vegetable growers growing inside greenhouses face, farmers said.

Meanwhile, two French farmers renewing their electricity contracts for 2023 said they were being offered prices more than 10 times higher than in 2021.

“In the next few weeks I will plan the season but I don’t know what to do,” said Benjamin Simonot-De Vos, who grows cucumbers, tomatoes and strawberries south of Paris.

“If it stays like this, there’s no point in starting another year. It’s not sustainable. »

Farmers aren’t just facing soaring energy prices: Fertilizer, packaging and transportation costs are all rising and hurting margins.

“We are facing an overall increase in production costs of around 30%,” said Johannes Gross, deputy sales manager of the German cooperative Reichenau-Gemuse, whose greenhouses cover around 60 hectares.

Energy accounted for between half and two-thirds of these additional costs, he said.

“Some colleagues are considering leaving their greenhouses empty to keep costs down. Nobody knows what will happen next year,” he added.

Greenhouse industry group Glastuinbouw Nederland says up to 40% of its 3,000 members are in financial difficulty.

Even in sunny countries like Spain, fruit and vegetable growers are struggling with a 25% increase in the cost of fertilizers.

Jack Ward, chief executive of the British Growers Association, said it was inevitable that fruit and vegetable production would shift to warmer climates.

“We will move production further and further south, through Spain, Morocco and parts of Africa,” Ward said.

Updated: September 24, 2022, 04:00