Confidence In The Industry
By Dave Harrison
Anecdotally, 2015 was a good year for most Canadian greenhouse growers. That’s clearly the impression you get from talking to growers and suppliers at conferences and other industry events.
This year’s Greenhouse Canada Grower Survey certainly reflects that view.
The survey is far from comprehensive, but still assesses some of the key factors in running a greenhouse operation today. Our results are definitely weighted towards smaller growers (some 44 per cent were less than 50,000 square feet), and has an Ontario bias in the responses (55 per cent of respondents were from the province).
On the financial side, it was encouraging to see 26 per cent of growers had double-digit 2015 sales increases over 2014, while 19 per cent had gains of between five and 10 per cent.
A key indicator of industry confidence is on the question of pricing levels for this year. Most respondents (70 per cent) were looking at price hikes. With inflation to contend with, it’s important to value products accordingly, and consumers rarely have a problem paying for quality. Greenhouse produce and plants have great value, and deserve such attention at retail.
Another key indicator is sales forecasting, and again growers are optimistic. The survey found about 47 per cent will be shipping more this year compared to 2014. There are some projections of sales declines, and we would suspect that reflects new competitors in local markets.
Input costs can give growers a few sleepless nights, and 2015 was apparently no exception, with electricity rates and labour costs leading the way, followed by heating and plant material expenses.
Increased biocontrol usage is a continuing trend, with 44 per cent of growers employing more predators last year compared to 2014. Thirty-four per cent said their year-over-year usage was about the same in the two years. The extensive use of biologicals reflects an industry that’s been pioneering with their usage for many years – certainly one of the most advanced anywhere in the world. That’s a credit to the leading edge research that’s been done for many years in Canada, and the work of extension specialists and suppliers determined to pass along the latest news. And of course, the grower community has been especially receptive to the concept.
On the question of anticipated business threats, growers are especially nervous about prices, energy costs and taxes/regulations – three elements they don’t have much control over. Electricity costs will become an even larger worry in future, as growers work to extend the season with supplemental lighting to tap into new markets.
Change is the one constant in the greenhouse industry, and growers have to anticipate trends. With the right timing, challenges become opportunities.
As our grower surveys have shown, the past few years have been relatively good for most growers, with sales growth and improved margins.
Premium products, as we noted earlier, always find a market.