Covid-19: how markets and people are responding

Fred van Tol, Manager of International Development at Royal FloraHolland

Over the past months, the world is facing a new experience of a pandemic that hit us hard. Depending on the country you are living in the effects differ, we all had to face challenges we have never had to before. After the first wave of infections, we have also experienced the flexibility of the markets. During the summer period, we saw a significant recovery of the floricultural industry. If we can avoid the second lockdown in our main markets, it may well be that economies face growth again by the end of this year. But, although I can imagine the relief for a lot of us, I also see a return to the old situation as a risk. From the experiences of the past months, we have learned that the new normal can be taken forward as a new way of living.

It showed us that we could work remotely. Not only within the company but also as the way we have contacted over the world. It saves us a lot of time and cost. And on some occasions, we even have more frequent contact with each other than physically in the past. That is the good news, but not everybody is comfortable with only a virtual connection. We are an industry relying on personal contact, and that also means face-to-face. Slowly we are looking into a new normal but also a new balance. The standard is virtual contact and occasionally physically. Within the company, that works all right, but with customers, we still depend on access to other countries. How can we do this when there is a block on passenger flights outside of Europe? It is also tough to travel to the main production areas. Fortunately, Royal FloraHolland has its teams locally present and via them, we can stay in good contact with our suppliers. Depending on the developments with an efficient vaccine, we will see when we can travel again without restrictions.

The lack of passenger flights also affects the way that our products can reach their destinations. Throughout the years a lot of cargo planes were replaced by passenger planes. It was more efficient to take a part of the cargo in the belly of the aircraft, instead of keeping dedicated cargo planes. Aviation institutions expect that we will not reach the 2019 volume of flights until 2024. So, we must prepare ourselves for alternative transport like sea freight. Fortunately, the techniques are improving fast, and we see a big growth already in the volume of containers from Latin America towards North America and the UK. But also in Kenya, there are more and more initiatives to use sea freight as a replacement for air freight. Suppose we can control the cold chain from post-harvest until arrival. In that case, it will provide our industry with a huge opportunity to decrease the dependency on airfreight capacity, and also make a sustainable contribution to horticulture’s carbon footprint.

Fred van Tol
Manager of International Development
Royal FloraHolland