Fruit and vegetables: Top firms’ incomes rise, yet problems remain

Unfortunately, only 40% of the fruits and vegetables sold in the country are produced in Bulgaria, said the Minister of Agriculture Kiril Vatev after the advisory council on vegetable growing and vegetable production in August. The goal of the Ministry of Agriculture and the sector for the next year is to bring the import-Bulgarian production ratio to at least 50-50.

Open air production is declining

Over the years, open areas for growing vegetables have been decreasing and in 2021-2022 they were 29.9 thousand ha, according to the statistics of the Ministry of Agriculture. However, greenhouses are expanding and now occupy 1073 ha. The production of vegetables from the 2022 harvest is 629.2 thousand tons, of which 109.7 thousand tons are greenhouse-grown. Among the largest productions are potatoes, tomatoes, watermelons, cucumbers and peppers.

Current estimates of the Center for Economic Analysis of Agriculture (SARA) suggest the production of tomatoes in 2023 may fall to 105 thousand tons, and a drop is also expected for cucumbers (to 49 thousand tons), but pepper production will remain roughly at previous year's level.

In 2022, areas with fruit, shell and berry plantations also decreased - by 3%, to 63,327 ha. Of the fruit produced, the relative share of plums and gooseberries is the largest, followed by cherries and apples. Compared to 2021, there was an increase in cultivated rose hips, almonds, peaches and nectarines, hazelnuts, apples, cherries, pears and raspberries. The production of walnuts, plums, apricots and sour cherries decreased.

Almost the entire amount - 97% - has been realized. The largest share of production is intended for direct sales in the commercial network - 52%, and 41% went for processing, reports the Ministry of Agriculture and Food.

More fresh fruit processed

In 2022, production of processed fresh fruit also increased - by 15.7% to 116.5 thousand tons, and 109.3 thousand tons of fresh vegetables. 78.2 thousand tons of finished fruit products were produced, compared to 86.5 thousand tons of vegetable products. The largest share of processed fruits includes apples, cherries and peaches, and of processed vegetables - tomatoes, peppers and potatoes.

Of the processed fruits and vegetables, the largest share are those delivered by Bulgarian producers, reports the ministry.

"The production of fruits and vegetables and their processing are closely related, the problems in one sector are reflected in the other," comments Konstantin Lambrev, manager of the Konex-Tiva cannery. He points to statistics according to which the largest quantities of cans were produced back in 1985 - 670 thousand tons. Due to the drastically reduced production of fruits and vegetables in open areas, however, their production is now collapsing.

According to Lambrev, a problem for processors is the lack of large fruit and vegetable producers and the almost complete absence of producer organizations that unite in the name of markets. "This leads to difficulties in the traceability of production and batching of deliveries, in the uniformity of varieties, agrotechnical measures and laboratory analyses, as well as problems in transport. The producers lack handling equipment for sorting, refrigerators, and transport packaging. There are no characteristic and distinctive Bulgarian varieties. As a result, there are difficulties in annual and multi-year contracts and planning obstacles on both sides," he concludes, calling for the unification of producers, regardless of the format - organizations, cooperatives or commercial companies.

The top 10

The top 10 largest companies in the sector report total revenues in 2022 have grown by more than 39% (for the same comparable companies) and exceed 95 million levs. Nine companies reported higher revenues of sales compared to the previous year, the most notable being the jump at Greens (263.7%), Agrologic (79.5%) and Greenhouses Gimel II (41.2%). Only one company in the top 10, Eurofields BG, reported a decrease in its annual turnover.

The biggest profit in the top 10 was realized by Greens and Yordan Velichkov - Vladi. On the other hand, Biofruta and Ecoterra worked at a loss, and four companies reported lower financial results in 2022 compared to the previous year. Greens and Agrologic were most profitable, and Bata 2002 was the largest employer, followed by Greenhouses-Gimel II and Yordan Velichkov - Vladi.

The top 3

The ranking is headed by Greens - one of the largest producers of greenhouse vegetables in Bulgaria based in Parvomai. The greenhouses were built in 1966 under the guidance of French and Dutch specialists. A large hailstorm in 1998 destroyed all the glass and a significant part of the heating system and structures. In 2000, the new owner - Greens Ltd. managed to restore, expand and renovate the site.

According to the company's data, vegetables - cucumbers, tomatoes and peppers - are grown on 630 decares of land housing 240 decares of greenhouses that are fully gasified, with drip irrigation, hydroponics and computer regulation of the production process using Dutch technology. The company has a certificate for good agricultural practices GlobalGAP, its own refrigerated trucks for delivery, and sells both on the domestic market and abroad.

Second in the ranking is Greenhouses-Gimel II with over 41% growth in revenues for 2022, exceeding 17.5 million levs. Greenhouses-Gimel II were established in 1995, after the state sold 100% of the capital of Orangeries - Levski. Today, the main production site of the company is a Dutch-type greenhouse in Levski, located on 120 of 190 decares. Since 2013, a cogeneration plant has also been operating, and the company sells its electricity production.

According to the company's activity report, its main production consists of greenhouse cucumbers. In the winter season, they are grown on 120 decares, and during summer - on 75 decares. The share of produced and sold electrical energy in the total share of the produced output is 43.88%.

The leader from 2021 ET Yordan Velichkov - Vladi, comes in third place in the top 10 in 2022. The company is registered in Sofia, beginning its activity in 2010. It produces greenhouse cucumbers and tomatoes, cereals and oil crops, potatoes and onions, and trades in vegetable seeds and mineral fertilizers. Its production is based in Plovdiv, Montana, Vidin and Pazardzhik.

Vegetables are produced in a closed cycle - harvesting, processing, foiling and packaging. Production processes are certified according to the global standard for good agricultural practices GlobalGAP, and good social practices - according to GRASP. The company reports a decrease in both revenue and profit in 2021, but still comes in the top three.

Its activity report states that it operates "in conditions of great competition". In 2022, it realized the harvest of vegetables, but the production of cereals - wheat, sunflower and corn, is "in the warehouses and waiting for a better price". In 2021, the company sold agricultural land, buildings and machinery for 3,167 million levs. The big challenge for the company is to maintain its market position in conditions of increasing inflation.

Foreign investments

Coming fourth and fifth in the ranking are two subsidiaries of the Italian food holding Rigoni di Asiago - Biofruta and Ecoterra. In 2021, Biofruta increased its sales by 14.5%, reaching 10.4 million levs, while Ecoterra's turnover reached 8.214 million levs (7.72% growth).

In southern Bulgaria, Biofruta grows peppers, pumpkins and green beans. It owns a large refrigeration base in Pazardzhik and sells frozen products, mainly on the European market. Meanwhile, Ecoterra owns plots near Berkovitsa and Pazardzhik, where it grows organic raspberries, blackberries and strawberries. Some of the produce is sold fresh or frozen, and the rest is used for jams in the Rigoni di Asiago factories. The two Bulgarian subsidiary companies are expanding their production and are already growing blackcurrant, lemon balm, oregano, basil and other herbs. They are also engaged in the purchase of forest fruits. In addition, they produce chicory for the radicchio salad, which is quite popular in Italy.

The two companies continue to operate at a loss, although the rate of loss is decreasing. According to the activity report, in 2022 Biofruta invested 2,772 million levs in agricultural equipment and inventory and construction of a main irrigation pipeline, with the largest part of the amount - 2.5 million levs used for commissioning of perennial crops - orchards with apples and cherries.

Ecoterra has also made investments in fixed assets. The company has invested 701 thousand levs in land, permanent crops, machines, equipment, and means of transport. In 2023 the company plans to increase its production of apple concentrate, as well as its plot with apple plantations, adding another 200 decares.

Eurofields BG, which ranks ninth, is also owned by foreigners. The company belongs to Gurmuk Singh Rupra from Great Britain through Europe Holdings. It began operations in Bulgaria in 2005. It farms about 3,500 decares of land in the area of the Pazardzhik village of Malo Konare, where it grows sweet potatoes, peppers, coriander, as well as flowers and seeds. It also has an R&D center on an area of 20 decares, where it experiments with different varieties. For 2022, it reports a nearly 35% drop in revenues, which reach 3,730 million levs.

Bulgarian-owned

In sixth position with a turnover of more than 5.7 million levs for 2022 comes Ekoplod Milevo, co-owned by Krasimir Vasilev and Georgi Trakov. The company produces fresh fruits and vegetables in the center of the Thracian lowland and has closed the entire cycle of production - from the field, through storage and sorting to the packaging of the products. In 2022, it reported a growth in sales of 12%.

Seventh in the ranking is Burgas-based Bata-2002, which grows wine grape varieties. It is owned by Milena Dimitrova Stefanova.

Ranking eighth is Euro Plants - based in the village of Kostur, Svilengrad, with sole owner Slavey Slavchev, which grows strawberries. The company notes a 32% jump in turnover, which exceeds 4.8 million levs in 2022.

The top 10 is completed by the potato producer and wholesaler Agrologic, located in the village of Popovyane, Samokov. The company is owned by Slavcho Chervenkov and reports a 79.5% growth in revenues exceeding 3.7 million levs.