"With today's lettuce facilities, you can go from 0 to 100% production in a day. One day, you have nothing, and the next day, you have 30,000 heads of lettuce. All because you're working with a continuous series of production cycles. This necessitates a comprehensive approach that takes into account both production and marketing aspects," says Bas Duijvestijn from Van der Hoeven Horticultural Projects. The company is actively involved in various greenhouse projects across the globe. Not only in North America but also in places like the Middle East and Asia.
Challenging period
The North American horticultural market is currently facing a challenging period. After experiencing significant growth for years, the sector is now encountering new obstacles. Rising interest rates, increased costs, and dwindling profitability, especially among American nurseries, have led to a decline in growth. Bas notes, "In areas like Leamington and Mexico, high-quality tomatoes are being cultivated at competitive costs. It's tough for the U.S. to compete when labor and energy costs are often higher.
"Successfully growing fruit and vegetables in the U.S. requires additional conditions, and that's proving to be difficult. Despite the size of the country, it appears to be challenging to find a piece of land with a favorable climate, low energy costs, and sufficient labor to position themselves better for low-cost local production. Different states are exploring ways to support this, and we expect the situation to improve. However, many fruit vegetable growers are currently finding it challenging to make this business model economically viable."
The Sara greenhouse facility, realized by Van der Hoeven in Japan
Lettuce facilities
In contrast, the lettuce sector is experiencing a different trajectory. Lettuce cultivation demands less labor and continues to expand, primarily because of the steady year-round production and predictability of an indoor farm. Van der Hoeven is currently constructing the greenhouse for Better Future Farms, a fully automated lettuce farm, equipped with Hortiplan's mobile gully cultivation system. The companies are part of the Arvesta group.
Bas highlights: "Hortiplan is the ideal partner for us. We collaborate in engineering, project management, and R&D. Working together brings a lot of stability, and also, from an external perspective, it's a compelling story: we're the only group with a fully integrated lettuce solution backed by a proven track record. Hortiplan has 30 years of experience in lettuce systems, and Van der Hoeven has been in the greenhouse business for 70 years. That's a powerful combination."
This partnership even allows these companies to provide production guarantees. Bas explains, "Depending on the client's needs, we can provide operational support for a certain period to ensure that the equipment we install generates returns as quickly as possible. We also provide local training to ensure the entire greenhouse operates profitably. This mitigates risks for the grower and investor, which is crucial in these times."
"We've seen nurseries emphasizing elaborate stories about technology and shiny PowerPoint presentations. However, ultimately, the key is to be producing a head of lettuce at the lowest possible cost. That's how you make money in this sector. Your business decisions should align with that goal."
Effective marketing and distribution
Effective marketing and distribution are also crucial. "Once you start seeding, the factory is in motion, so you must maintain control over all aspects. Alongside the initial investment costs, fixed expenses for seeds, energy, and substrate continue. Due to the continuous production cycles, you swiftly transition to full-scale production. At the same time, supermarkets often need time to evaluate and test a new product before committing to large quantities. This presents a challenge, especially for relatively new products like Controlled Environment Agriculture (CEA)-grown lettuce."
Better Future Farms has partnered with traditional outdoor grower Taylor Farms to address this issue. This established outdoor lettuce farm manages distribution. "They have a market and customers. This is a crucial part of mitigating that risk. You want to make sure that as much produce is being sold from the moment you are in operation. If you have a strong brand and the retailers are asking you for more products, you don't have to worry about sales."
Van der Hoeven is also actively expanding its presence in other regions, such as Asia and the Middle East. An especially noteworthy project is underway for NEOM in Saudi Arabia. This greenhouse incorporates a range of techniques and technologies for diverse crops. Bas remarks, "It's also a pioneering project for NEOM to determine the most effective methods for their country, paving the way for future expansion. We are very proud to have been chosen to be the exclusive partner for this project."
