“For us quality is the most important.” – says Roman Jagieliński – Former Deputy Prime Minister and Minister of Agriculture of Poland, Founder of the Roja Fruit Producers Group.
PolandWeek.com: The Roja Fruit Producers Group is your idea. How did that start?
Roman Jagieliński: After ending my political activities, I engaged myself in proper development of an agricultural holding, which is simply a trade. I establish cooperation with Biedronka, but its demand was so heavy that as an single agricultural holding, I wasn’t able to supply the chain with sufficient amount of product. as a result, I began to cooperate with other farms, but it turned out to be insufficient as well. At that moment I faced a choice: I could grow a company on my own or take the opportunity offered by the act on agricultural producers’ group and their unions.
And what was the final decision?
We established producers’ group. When we started, 90 percent of our apples was delivered to Biedronka food stores. Today, it’s a different scale, though we still sell a lot through this chain. We work 365 days a year and our sales stays at 2,5 – 3 thousand tonnes a month. In comparison, other producers groups sell as much of apples within a year.
Our group consists of 54 members. As a producers’ group we are widely spread across six provinces, the farthest agricultural holding is 400 km away from our establishment in Regnów.
How do you handle this situation?
This is, of course, certain logistical problem, but we solve it by developing our own transport. We have bought several additional trucks and now we are able to deliver our products throughout Poland. On foreign countries, we have adopted a model that our customer takes care of the transport. We don’t interfere in that matter.
Why it is worth to consociate?
Today’s market requires large supplies of goods – homogeneous and repeatable throughout a year. Certain apple varieties are sold from September until August. As a single agricultural holding we wouldn’t have been able to meet such requirements. However, as a group of 54 agricultural holdings we have better and stronger position in negotiation and as a result we have production at a level of 40 – 50 thousand tonnes at disposal. Thus, we may process as large order as even 5 thousand tonnes.
Doesn’t quality suffer from that?
For us quality is the most important. There are no concerns regarding 99,99 percent of our supplies. Of course, complaints happen but they are related to mistakes made during labeling process. So it is not a question of our apples’ quality.
How do you assess today’s markets?
Imposing trade embargo with Russia has had a huge influence on the market. Now the situation is stabilizing. Many contractors inquired about our products right after restrictions has been introduced. They weren’t our constant business partners and it was impossible to verify their reliability. Embargo was widely presented in the media, so it seemed that our apples would have lower prices.
Regrettably, Polish producers compete on price in the European market. In my opinion, as an industry, we should think about what to do to go beyond this situation. Polish apples are of very good quality, but for this quality someone have to be willing to pay.
In other worlds, do you recognize Polish – Polish competition?
I regretfully acknowledge that Polish-Polish competition does exist. We offer the best, yet more expensive apples. In the domestic market we work with supermarkets such as Lidl, Biedronka, Piotr i Paweł. We choose business partners, who – by offered price – guarantee us at least production restoring. We do not accept dumping prices, which often ruin Polish producers.
Is there such a thing as Polish Brand?
No, there isn’t and the question is whether we want to create such brand or not. Poland is perceived as a producer of agricultural raw materials, which are quite of lesser quality. In clients’ awareness Polish Brand doesn’t exist. Also, the EU promotes regionalism – therefore we have Mazovian apples or apples from Grójec rather than Polish apples.
Are you a born fruit grower?
I always say that firstly I was fruit orchard owner. Then I went into politics. When I came back to fruit growing, after so many years, I had to learn new things. I laugh sometimes that I was born in the orchard. It is a generational matter – grandfather, father, my brothers. Additionally, my educational background, experience.
Do you share your knowledge and skills?
Fruit growing does not close itself in one agricultural holding. We generally gladly share our knowledge and work experience. Probably this is why entire industry succeeds. I, personally, was in Belgian, German, French, Italian fruit growing. In all those places, we were openly shown methods and accomplishments. Our Polish orchards have been greatly developed and we can compare them, as a matter of fact, only to the best in the world. We invite foreign fruit growers and we present them our achievements. It is particularly visible in the Warka and Grójec area. I myself didn’t see such agricultural holdings in the Western Europe.
Such agricultural holdings?
Modern, with such level and quality of production. We are at a high level, but our farms are diverse. If we want to compare ourselves, we should compare our orchards with South Tirol. Although this region is climatically homogeneous, orchards cover from several to several dozens hectares of land. They are well organized, have relevant services setting harvest schedule for a given varieties of apples. When someone will be late, the price is reduced.
Would it be difficult to implement such solution in Poland?
We would hear an explanation that, for instance, there is a lack of workers and the weather is bad. To give just one example from the Netherlands, I know the orchard that switch to only one variety of apples, which is characterized by very short harvest time. This company prepares itself and in due course, works in three shifts. And this is all being done in order to harvest quickly and store up properly. All this guarantees that apples will be stored properly.
Does that mean that Polish character can be the main obstacle in consociating, which would help in the market?
A man’s home is his castle. It is related not only to apples. It affects other industries as well. Just look at Polish dairy industry. There are huge companies, but we also have about 200 small firms. Why don’t they integrate? The huge ones, which control the market, pay more for milk. Smaller dairies, which operate exclusively in the domestic market, pay much less, and despite this producers don’t consociate. If milk producers would integrate – their position were much stronger.
We also discuss setting up consortium. I think that it is too early for that. Consortium should be established when an adequate capital is at disposal. At this moment, we are at the stage of investments.
Interview part two – July 11, 2016