It is still a matter of dispute whether it was the Spanish conquistador Hernán Cortés or Christopher Columbus who deserves credit for taking the tomato with him from the New World to the Old, but once transported, the tomato made itself at home. Mediterranean countries in particular had the sun, soil and skill to cultivate luscious fruits. (Yes, it is a fruit.) Tomatoes, as much as garlic and olives, were a southern-European product. Up in the frosty north, on the other hand, tomatoes from the Netherlands used to be derided by the Germans as recently as the 1990s as Wasserbomben (water bombs), so tough and flavorless were they.
But in recent years the European tomato landscape has changed dramatically. Now the Germans can’t get enough of Dutch tomatoes. Even Spain, Italy and Greece import them. The Netherlands, rather than any of the sunbaked lands hugging the Mediterranean, is now the largest exporter of tomatoes in Europe.
If you want to understand the transformation of Europe in the decade since the adoption of the single currency, the euro, you could do worse than to follow the journeys of a Dutch tomato and a Greek tomato in 2013. In sunny Greece, which produces almost twice as many tomatoes as the Netherlands does, almost none of the squishy, delicious product makes it beyond the country’s borders, except in cans or as paste. That means that few people outside Greece are paying Greeks for a plentiful, potentially profitable crop–a missed opportunity for the debt-laden nation. In summer months, Greece imports Dutch tomatoes because Greek farmers haven’t yet figured out how to efficiently grow enough of the fruit during the hottest time of the year. A Dutch tomato, by contrast, is a serious traveler. “I don’t understand why Greeks import so many tomatoes, especially from a sunless place like the Netherlands,” says Constantinos Akoumianakis, an assistant professor at the Agricultural University of Athens.
But the Greeks aren’t the only tomato-growing giants who find themselves looking north with a mixture of frustration and admiration. The Spaniards are doing what the Greeks have not done, by and large: scrambling to learn all they can from Dutch growers. In the process, they’re helping level out the huge imbalances in efficiency and trade that exist inside the euro zone. Tomatoes are hardly the linchpin of the European economy, but because they are grown in so many different European countries, they do a nice job of highlighting problems in an economic bloc whose founders envisioned that strength–rather than the current weakness–would come from tying Europe’s economies together. If the south’s tomato growers become genuinely Dutch, it would be a sign that a fully efficient European economy is on its way to becoming reality.
Dutch Courage
In Italy and Greece, tomato farmers mostly grow their crop out in the open or in simple, unheated greenhouses. The drawback of this method is that for most farmers, there are at best two crops per year rather than year-round production. And when the weather doesn’t play along, the harvest is poor.
The Dutch way is different. It’s a high-tech evolution of techniques invented generations ago by Dutch growers to raise plants and flowers despite often hostile weather. Jos van Mil, 49, who with his brother-in-law founded a company called Greenco, is a third-generation grower specializing in baby plum tomatoes. Outside, the flat plains of the Netherlands’ Westland region (the ground zero of Dutch tomatoes) are covered in a thick white crust of snow. But sitting inside one of his perfectly heated greenhouses, van Mil is unfazed. “I like this weather,” he says. “There’s a bit of sun. It’s better than when there’s no light.”
His grandfather Joop, who started growing tomatoes in the 1930s, set up each of his eight sons with a piece of land and a primitive greenhouse. At first, the van Mil sons grew cucumbers, salad greens and crops that do well in colder climates. The postwar years saw rising wages and more sophisticated growing techniques. By the 1990s, farmers in the Netherlands were starting to hook computers up to their greenhouses, while their rivals in Spain and Italy were still getting their hands dirty the old-fashioned way. The computers control temperature, humidity and carbon dioxide levels in the greenhouses, helping create ideal growing conditions.
Dutch tomatoes are planted not in soil but in growing beds made of mineral wool, a substrate that looks like cotton candy and is spun out of basalt and chalk. The beds let growers precisely control the dosage of water and nutrients. The difference in productivity between the Netherlands and countries to the south is stunning. A Dutch grower can get up to 150 lb. of tomatoes out of each square yard of his greenhouse. A Mediterranean grower is lucky to get 15 lb. outdoors. The Dutch have even found a way to turn the weather to their advantage. Mediterranean countries ordinarily have two crops per year: one in winter or spring and one in autumn. In the summer, it’s too hot in southern Europe to grow tomatoes under plastic. But in the Netherlands some growers, using artificial lighting in greenhouses, are able to produce pretty much year round. In Greece some growers have started investing in Dutch technology–for example, at the $30 million Wonderplant project in northern Greece. But they remain exceptions; sophisticated greenhouses account for just 1.6% of the area given over to produce grown under cover.
Once upon a time, Dutch growers sent their tomatoes to daily auctions, which retailers disliked because they could not buy in bulk. In 1996 all that changed: the auction houses merged, and an integrated trading company, the Greenery, now works closely with the top supermarket chains in Europe and suppliers around the world. Farmers like van Mil get to sell their produce in high volume. Greece, Italy and Spain have nothing like the same degree of logistics to support their tomato exports.
Single Market
Once the continent was united by a single currency in 2002, competitors lost a powerful market weapon: the ability to control prices for their produce. When Greece, Italy and Spain still had their own currencies, they could devalue them to make their exports more attractive to foreign consumers. That option no longer exists. It made the Dutch even more efficient as they sought to compete, whereas the Mediterranean countries had no incentive to invest. So the only road back for those southern countries is cutting costs, embracing technology and raising productivity closer to Dutch levels.
But that won’t be easy. Van Mil sells 150 tons of tomatoes per week, mainly in Europe. He picks his tomatoes only when a supermarket has placed an order, and he packages them using the store’s branding. That saves time at the other end; the supermarkets just slap on a bar code and a price sticker. Critically, the tomatoes themselves are different from the green, watery ones of the Wasserbomben days. Dutch growers diversified away from the loose round tomato that had been their main crop, which they picked before the fruit was ripe. In came more varieties and a focus on harvesting at the last minute to ensure maximum taste. Are they as delicious as a freshly picked Cretan tomato? Perhaps not, but the big rise in sales suggests that consumers like them again.
The adoption of the euro enabled Greeks to borrow money at much lower rates than they could before, when they had the drachma. Along with the cheap credit came a continuing inflow of E.U. subsidies. Greeks suddenly had more money to spend. That pushed up demand, which pushed up prices and wages. Which was wonderful for a while for individual Greeks but bad in the long run for Greece. “Suddenly industries can no longer compete,” says Ulrich Blum, an economics professor at Martin Luther University of Halle-Wittenberg in Germany. “The Greeks used to have factories that made shoes and textiles and furs, but they’ve gone bust.”
Greek agriculture has been particularly hard hit. Productivity is 44% below the European average, and labor costs have almost doubled, compared with a rise of just 3% in Germany. Giannis Karagiannis, an economist at the University of Macedonia in Thessaloniki, Greece, who specializes in agriculture, acknowledges that productivity is low but also blames tight-knit oligopolies that control distribution. These middlemen pay farmers low prices and take big markups on tomatoes even as they have failed to put in place more efficient domestic and international distribution systems. “We have to make the market work,” he insists.
Playing Ketchup
If Greece ever hopes to use its plentiful crop to help it fight back economically, it would do well to look not just north to the Netherlands but also west to Spain. Driven by the fear of having their livelihoods wiped out by Dutch farmers, Spanish growers have worked to improve their logistics, including supplying directly to supermarket chains around Europe. Some have adopted Dutch greenhouse techniques or partnered with Dutch growers like van Mil. But the Spanish will need to keep improving their techniques to stay ahead of the Turks, Egyptians and Moroccans, who are producing ever more efficiently at lower costs than the Spanish.
The Dutch advantage isn’t set in stone. Productivity has gone up impressively, but the Netherlands will need to fight to stay on top. If the Greeks can import more Dutch technology, they could stage a comeback. And then Europe’s economic playing fields might start to look more like the flat, productive plains of Westland.
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