Amid market volatility, globalisation, a product portfolio that is particularly vulnerable to IP infringement and a regulatory burden that is extremely heavy, tropical plant breeders and propagators Peter and Elly Bak are a prime example of glass half full entrepreneurs; their minds always revolve around new ideas and opportunities for plant innovation. Anytime soon, an authentic tea sommelier will make his appearance in their greenhouses to explain the effect Bromelia tea has on the mind and body.
Synganththus chrysanthus ‘Mikado’ is just one example of how Corn Bak has brightened up homes around the world by bringing tropical, architectural nature indoors. Apart from being a top-selling houseplant, Mikado is also the name for a famous game of patience with players removing sticks from a pile without causing disturbance to the other sticks.
Tons of patience and a deep breath is what third generation, brother-and-sister team Peter and Elly Bak often use, especially when confronted with yet another set of poorly-understood government rules.
The word government alone is enough to ignite a debate as fiery as the red in their bromeliads. But please don’t misunderstand them. They are not against regulation per se. “Our many years of participation in MPS is born out of a true commitment to the environment. In terms of pest management, we rely on IPM based on biological control about 70% of the time. But why should the environmental burden fall heaviest on SME’s which make up most of the horticultural landscape? Can someone explain to us why greenhouse businesses have the obligation to treat their water before discharging into the sewer system while there are a worrying number of antibiotics and heavy chemicals in our tap water? I am more than willing to invest in the environment, but I would like to see these efforts awarded instead of penalised,” comments Elly on the current business environment for greenhouse growers.
She is quick to rise above the passions of the moment. In a more pragmatic way, “It’s simply a fact that when operating a greenhouse business, you run into situations outside of your control that will cause frustration. Maybe that’s why we aren’t actively planning business succession. We don’t want to make our children feel obligated, but they are free to join the business if they so choose. Peter’s children are still too young but my son joined eighteen months ago and my daughter, who is studying agriculture at HAS Den Bosch, has also shown interest in Corn Bak.”
The name for Corn Bak Nursery is an homage to Cornelis Bak who started growing tulips, vegetables, Hydrangea and Sansevieria in 1929. “Today, we are specialists,” explains Peter. “We are entirely focused on breeding and propagation with up to 90% of young plants being seed-raised. Raising one generation of bromeliads from seed to seed takes three years. We offer experience and expertise in seed propagation and this applies not only to our flagship product, bromeliads, but we have expanded our business to include a wide range of products,” he adds.
He references the carnivorous plants Dionaea muscipula, also known as Venus Flytrap. “In carnivorous plants, growers believed young plants from tissue culture and offshoots were quicker and cheaper but the truth is there was inconsistency in supply and quality. Today, Corn Bak is the principal propagator of Dionaea, supplying 3 million young plants per year. In cutting raised Medinilla more or less the same thing happened with Corn Bak taking the lead in breeding. For those who experience unanticipated problems in their existing propagation programmes or growers who have found promising species for commercial production, Corn Bak is an obvious choice for setting up growing protocols and breeding programmes,” says Peter.
By adding new, niche- type products to their portfolio, the Baks have decreased the risk of doing business. A larger and more diverse customer base also helps insulate their business against over-reliance on a single client who may feel tempted to increasingly squeeze the price. However, the market potential, the pros and cons of each new product is weighed carefully to avoid losing credibility in the minds of existing customers when it comes to the core product, bromeliads.
Rightly regarded as one of the most colourful tropical plants, the family bromeliaceae are (mostly) epiphytes originating from the southern United States, South America and the West Indies, where they grow on trees.
In Assendelft/Zaandstad, Corn Bak grows a wide variety of genus and species in their 35,000 m2 nursery. 1959 marks an important milestone in the history of the company; the year in which the very first bromeliad, a Vriesea splendens, was planted in the greenhouse. “Way back, dad started selling plant material to growers in Germany, Denmark and Italy with almost all of these eaten by their more efficiently growing and trading Dutch counterparts, who were lucky enough to sell to a vast, auction-based network of wholesalers. As such, non-Dutch bromeliad growers face a dual challenge as they struggle to find a successor and to compete with Dutch-grown plants,” says Elly.
Corn Bak supplies young plants of Guzmania minor, Aechmea fasciata, Neoregelia carolinae, Tillandsia flabellata, Tillandsia leiboldiana and Guzmania hybrids. Interestingly, Bak’s greenhouses also host a collection of bromelias in the true sense of the word: a bromelia species with large spiny leaves used for ground cover, living fence or…tea. “As part of the Biobased-Greenport Programme we’ve teamed up with bay laurel grower Charl Goossens, curcuma and pepper grower Westlandpeppers and herb basil grower De Kruidenaer to unlock the anti-diabetic potential of plants. Each grower will provide the plant parts to be used; Corn Bak will harvest parts of bromelia balansae to be used for a tea which hopefully will be available by the end of this year. A tea sommelier will take care of the taste while the preparation and drying of leaves and plant parts are done in collaboration with WUR agricultural university and research company ‘t Akker,” enthuses Elly.
In terms of product diversification, Peter says bromeliad breeding is a laborious task with the average time for varietal development being as high as 15 years. With this in mind, it is only a blessing that trends affect the bromeliad business to some extent. However, a cultural colour definitely exists. Elly: “Everyone in the industry knows that in China it is mainly about two red cultivars while in the USA purple cultivars have a stronger market presence. In Europe it is reds in different hues. A green bromelia? Look no further than our Vriesea fenestralis and hieroglyphica. A fragrant Vriesea or Guzmania? This is not something completely impossible but you will have to use new gene editing techniques to build the heavenly fragrance from tillandsia into other genus. However, the European court banned CRISPR-cas with Europe losing its competitive edge in food and ornamentals production.”
As a breeder the folks at Corn Bak constantly ask themselves whether a new variety truly provides added value. “We don’t want to offer our customers a cannibal chipping away at existing market share. That’s why growers and traders are more than welcome in our greenhouses to discuss product development. Unfortunately, we don’t see them on a regular basis,” says Elly.
Always room for improvement
While bromelia tea is a completely new endeavour, Corn Bak has successfully mastered the particular skills needed for growing bromeliads. “But there’s always room for improvement,” says Peter.
He continues, “Founded in 2014 under the umbrella of sector body Glastuinbouw Nederland, the Dutch Gewascooperatie Bromelia (Crop Cooperative Bromelia) conducts tests and research and development studies to identify ways to improve plant health, yield and efficiency. A particular focus is on optimal growing conditions, the use of light and heat in bromeliad growing. Additionally, Corn Bak provides its own technical support. At home and abroad the biggest challenges to overcome are increasing energy prices and labour costs.”
Meanwhile, growth in international trade, travel and individual behaviour are increasing threats to biosecurity by providing opportunities to introduce new invasive pests and pathogens. Peter: “Apart from the usual thrips and mites, bromeliads are quite a healthy crop, touch wood. However, I can still remember how a devastating fungus wreaked havoc in a specific genus which is no longer commercially grown. So you never know.”
Mapping the global bromeliad sector
Mapping the global bromeliad sector, Elly and Peter consider ‘the European market part of a wider Netherlands’, referencing the Netherlands’ top ranking in bromeliad production.
“As such, we derive 70% of our revenue at home with the remainder attributable to income from exports to our top three export destinations: the US (in partnership with Foremostco), China and Japan. Sales in Europe are stable. In China, the market continues to be volatile.
Commenting on the potential of the Chinese market, Elly says that establishing a company in China is ‘damn hard’ for foreign companies as buying habits of local consumers are different, legal and regulatory systems differ and IP rights are notoriously difficult to enforce.
A propagation prohibited warning in Chinese language in Peter’s email signature makes clear that IP theft continues to be a serious problem. “They have a different attitude to IP,” Elly says. She adds, “That’s been known for twenty years. It’s not that it’s bad per se, but the lack of transparency of the country’s IP examination process can be frustrating. People tell me that you can register the exclusive rights to your plants in China. And they are perfectly right. But what happens next? In Europe and even the USA you fill in the necessary paperwork, you submit your plants and receive confirmation of receipt followed by an invitation to personally assess your plants at the testing station, there’s a judging committee etc. In China, you have no idea where your plants are and you don’t receive any feedback. Trying to find things out by contacting the relevant authorities can raise the suspicion of bribery against you. So the government changes testing locations and employees change every two years. Despite copying of their plants, European breeders generally don’t take action in China as they feel the odds of winning against local companies are low. Many years ago, when entering the Chinese market we discussed the IP issue with fellow breeders who grow a huge range of pansies in China for seed production. No question of growing female and male plants next to each other. Pollen for crossing is flown in from other parts of the world.”
‘This is our own business, we are getting along very well with each other, happy that we can build the company on our own strengths’
Elly and Peter estimate that the area devoted to commercial greenhouse production of bromeliads is currently 40 to 45 ha. The production area is more or less stable while the number of growers has decreased significantly to 16. Among those who have withstood the economic crisis – when a wave of bankruptcies (6!) swept the industry – are growers with iconic names such as Bunnik, Stofbergen, Kwekerij Randstad, Best Bromelia, Meeuwisse, Meeuwisse Zeestraten, Koolhaas, Tobias, Van Winden and Rip. “Overall, the bromeliad business is going through a period of consolidation. This also applies to bromeliad breeding: in 2009, there were five breeding companies: Exotic Plants, Deroose, Corn Bak, Van der Velden and a Brazilian/American breeder. Deroose acquired Exotic Plant and the American company went out of business so there are now three of us,” says Elly who adds that this process is likely to result in segmentation of the market with the coexistence of large, standardised nurseries and a handful of highly specialised growers.
“Larger companies – in Europe, Dummen Orange and in North America, Costa Farms – continue to outgrow the competition. It’s like a mesh or sieve with only a few products and services that will not pass through,” comments Elly. “Bromelia is missing in their offerings, they say, but we simply are not interested. This is our own business, we are getting along very well with each other, happy that we can build the company on our own strengths. Times are tough for a greenhouse grower but the fact is that we always see the glass half full and plenty of new opportunities.”
Elly stresses that almost always, mergers and acquisitions result in a brain drain with former business owners and their knowledgeable management team leaving the company. “Also, mergers can decrease the choice available to customers. Bromeliads have not yet reached the status of specialty products, but are slowly moving in that direction and this offers opportunities for companies such as Corn Bak,” Elly says.
Never say never
Levels of market entry remain extremely low, that is, zero. “The problem with large family companies is that for the next generation it is increasingly difficult to find financing. What’s also at stake is the industry’s image,” explains Elly.
Despite the sector’s enduring image problem and well-known labour shortage, she says they aren’t really struggling to attract workers. “We may be lucky for not being part of a huge greenhouse cluster where competition for talent is already tight. 80% of our employees are recruited locally and I am proud of the company’s diverse and inclusive workforce. We have people from different countries, races and ages with different religions and different values. Our workforce includes lesbians, gay men, people with disabilities; at Bak it is more than just differences, It’s about accepting those differences and walking together through the same door. If at Bak’s our diversity efforts fail, how can they ever succeed in society at large?” questions Elly who adds that flexible working hours, especially for women with young children help to attract and retain talent.
Will automation or offshore seed production redefine the way the work gets done?
Peter, “Seed propagation is handwork but outsourcing it to South America is easier said than done though as is requires specialist skills. Transplanting is what cost the most and we are now preparing the next step in further automating this process.”
Another example of technological progress is the newly built growth chamber for multi-tier production of young plants under LEDs. “The station is without natural daylight and offers convenience with uniform plants and quality year-round using a balanced light recipe,” outlines Peter. He continues, “Ultimately the goal is to manage crops and water, energy and crop protection use for the greatest possible return for the crop grown. In theory, if a customer asks us to delay the delivery of plants we can steer and slow down the crop by lighting a few hours less. Moreover, outbreaks of pests and diseases can be treated per unit while hail and snow will no longer keep you awake at night as no greenhouse is needed.”
Elly and Peter are the proud residents of Zaandstad, one of the ten cities that have been appointed by the Dutch government to run trials involving the cultivation of cannabis for recreational use. The goal is to determine whether and how controlled cannabis can be legally supplied to coffee shops. “Growing cannabis in our greenhouses? As humans we are ever-changing so you really should never say never. I have been told that all the big names in bromeliad growing from Florida had a license to grow cannabis which they already sold to the investment company who assisted them in obtaining the license. I guess this business is a profitable one.”