Greenhouse Canada

Features Business Trends
Inside View: Local angle will fuel industry’s new growth


February 4, 2009
By Gary Jones

Topics

here’s another year over and a new one just begun.” So, how does ’09 shape up on the back of 2008? The industry faces a number of issues, in particular:
• Labour.
• Energy.
• Trade.

here’s another year over and a new one just begun.” So, how does ’09
shape up on the back of 2008? The industry faces a number of issues, in
particular:

• Labour.
• Energy.
• Trade.

Employment: Finding suitable labour has been a problem for the
greenhouse sector globally for some time. Just ask any European grower!
In British Columbia, recruiting foreign workers is one option, if
you’re up to incurring associated housing costs for seasonal migrant
workers. Alternatively, some growers like Darvonda Greenhouses, in
Langley, have invested heavily in mechanization and technology.
Carousel watering systems and effective warehousing facilities make
production and shipping more efficient. (Incidentally, if thinking of
capital purchases, talk to an independent financier who knows the
industry – he probably has great insight to share.) But Darvonda’s
commitment to its employees through fantastic staff catering facilities
and a high grade employee gym shows how some employers are tackling
labour issues creatively.

Energy: This is another continual dilemma. In just 12 months, oil
prices peaked at all-time highs, then fell to extreme lows. However,
the overall trend for energy demand and costs will likely continue
“onward and upward.” With new air emission standards agreed by all
stakeholders in B.C., another enterprising Langley grower recently
received his first consignment of pine-beetle wood to heat new
vegetable crops. Huge thanks to the B.C. Greenhouse Growers Association
(BCGGA) and the United Flower Growers (UFG) who worked tirelessly with
producers and government on resolving air quality standards.

Trade: A two-part story – losing value and adding value.

Step one – not losing value. Not long ago, we debated the effects of
parity between the loonie and the greenback (‘Inside View’, November
’07). Now it’s back down to around 80 cents to the U.S. dollar.

A strong Canadian dollar a year ago had residual effects on some
producers. Eric Voogt at Westcan Greenhouses, in Langley, recognized
for his outstanding commitment to quality and his terrific
spring/summer bedding and Christmas poinsettia trials, is a good
example. Twelve months ago, Westcan was dependent on significant U.S.
sales. But quoting prices a year ahead of deliveries and roller-coaster
loonie values produced huge challenges. Similar (or higher!) production
costs, coupled with a significant slowdown in the number of new
introductions from breeders, means Eric has decided to make ’08’s
poinsettia open house the last “annual” event. From now on, they’ll be
in alternate years. (Thanks to David Schmidt – the first recipient of
BCGGA’s “Communicator of the Year” – for reporting this.)

  
Step two – “adding value.” New products (be they plant material or
other goods/services), new packaging and simply being proactive with
customer care are essential to stay afloat. Growers, especially of
ornamentals, will need to “ramp up” this department in 2009. For
growers of edibles, the trump card of “buy local” may help head off
increasing foreign production. For example, while the Canadian
greenhouse tomato industry has hovered around the mid-400-hectare level
over the last four to five years, similar Mexican production went from
about 200 hectares five years ago to nearly 800 hectares in ’07.
Differentiating Canadian greenhouse product therefore requires
significant attention.

OTHER POTENTIAL ISSUES
Carbon tax, water availability, unpredictable Canadian weather
affecting consumer buying patterns, new pests (Chile thrips came in ’08
– what’s next?) and effects of a real (or “induced”) recession may set
new challenges for ’09.

STAYING POSITIVE
But all is not gloom. While the particulate emissions legislation may
be seen by some as a loss (compared to the status quo at least), the
process itself should be seen as a positive step in the relationship
between growers, producer associations and the provincial government.

Despite talk of recession, the Canadian economy has been faring better
than most in the “G8.” Once we finally establish/finalize a federal
government(!), we’ll be in a good position to move forward. Even if a
recession does bite, ornamental producers may see more people taking
“staycations” and “doing-up” their yards (and eating local food!).

The industry has a terrific product (whether edible or ornamental),
fresh and locally grown. Consumers are increasingly conscious of the
origins of what they purchase and this puts Canadian growers in strong
shape for ’09.


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