Analysts foresee weaker price trends for dairy farmers, pig producers and arable farmers, while prospects appear more positive for businesses in poultry farming, veal production and greenhouse horticulture. However, a potential energy crisis linked to the conflict in the Middle East could worsen the outlook—particularly for the greenhouse sector.
“In greenhouse vegetable and ornamental plant production, producer prices are currently positive across the board. Extreme weather in Southern Europe has led to crop failures for several vegetables in different regions. As a result, vegetable prices are rising, which benefits Dutch greenhouse vegetable growers,” the report states.
Gas and energy prices had fallen in recent months due to strong supply. However, according to ABN AMRO, tensions in the Middle East could put an end to this trend. Damaged production facilities, disruptions and blockages along key shipping routes in the region are currently affecting global energy markets.
Around a quarter of global seaborne oil trade and about one-fifth of global liquefied natural gas (LNG) trade passes through the Strait of Hormuz, which is currently affected by the conflict.
Oil and gas prices have already begun to rise, although in the first days after the outbreak of the war they remain well below the levels seen during the 2022 energy crisis. Agriculture is also facing higher energy costs, with greenhouse horticulture particularly exposed.
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The sector accounts for around 78% of the total energy demand of Dutch agriculture and horticulture, and energy represents between 15% and 25% of total production costs in greenhouse operations.
According to ABN AMRO, many greenhouse entrepreneurs have already learned lessons from the 2022 energy crisis. Since 2021, they have managed to reduce their use of fossil energy by around 20%, mainly through investments in energy-efficient technologies and alternative energy sources.
Energy management has also become more professional across many companies.
“Higher energy prices do not necessarily have to be entirely negative for the sector. Nearly half of greenhouse farms produce their own energy, mainly through combined heat and power (CHP) systems. Greenhouse operations supply around 12% of the Netherlands’ electricity demand,” ABN AMRO concludes.
