The Lily Bulb Industry Van Zanten Flowerbulbs Ltd

July 2005
Dutch company Royal Van Zanten has existed for over 140 years.

Originally started by two brothers producing mostly tulip flower bulbs on the west side of Holland, the company gradually increased to become a global force worldwide with four main divisions.

Those divisions incorporating research, plants (multiplying flowers through tissue culture), cuttings and bulb divisions have seen the company expand into countries such as Uganda, Kenya, South Africa, Brazil and New Zealand.

Van Zanten Flowerbulbs Ltd New Zealand managing director, Kees van Petersen, has worked for the company for 12 years working in cuttings in Uganda as well as in Italy and Brazil before coming to Rakaia three years ago.

Due to a short storage life of only 6-7 months for the newest generation of lily bulbs the Northern Hemisphere is only able to supply enough bulbs for the world market for six months of the year following harvesting in November/December.

So by 1998 Royal Van Zanten were looking to find a Southern Hemisphere country capable of producing high quality bulbs to be harvested in July/August to meet that shortage.

Lilies need free draining soil with little clay content. Climatically cold winters with hard frosts are required in order for the crop to die off.

Two such countries within the Southern Hemisphere offer perfect conditions.

Chile, in South America, provides excellent prospects for the future but it was in New Zealand that Royal Van Zanten decided to concentrate its Southern bulb business.

However, initially the company set up base near Paretai on the Clutha river flood plains and grew tulip and lily bulbs. Wet conditions and flooding proved difficult and encouraged the company to come further North to Rakaia in Mid Canterbury where the free-draining Barrhill silt loams and Chertsey silt loam soils, cold winters, high sunlight hours and irrigation proved ideal.

From 1999 when Royal Van Zanten grew just 8 hectares of lily bulbs, to harvesting 50 hectares this season, the Royal Van Zanten story is one of strength and growth.

Although Van Zanten Flowerbulbs doesnt own farmland it is able to produce 60 hectares of oriental bulbs by leasing land for between $2000-2500 per irrigated hectare from 4-5 farmers within five kilometres of the washing yard.

Anything further than 10 kilometres from the factory is considered unviable due to the cost of transporting the sheer mass of the voluminous crop to the factory to be stripped down and cleaned of plant material.

It is simply not viable for the company to buy their own land because of the 10 year crop rotation required for lily bulbs.

So if we want to harvest 60 hectares we would need to own 600 hectares. That means we wouldnt be utilising 540 hectares each year because we are not farmers.

An exportable lily bulb crop costs around $200 000 per hectare to produce. The majority of that cost is in the bulbs planted. It takes two and a half to three years to come to an exportable crop.

Approximately a third of those bulbs that are planted each season are plant stock produced in the previous season with the rest coming from the parent company in Holland.

There are few problems for farmers who have leased ground to Van Zanten Flowerbulbs. The bulbs are considered to be a good option following a cereal crop and require roughly 20mm spray irrigation every 10-14 days.

Leasers are expected to plough and roll the paddock and provide irrigation while contractors meet fertiliser and intensive spraying requirements.

Bulbs are planted into moulded 1.5 metre beds during spring using expensive imported planters.

During January flower heads are removed by another specialist imported machine, to stop the process of flowering - which in turn encourages the plant to put all its energy back into the bulbs.

Mozaik viruses appear to be the only disease that is considered to be significant to lilies. Spread by aphids the virus causes misshapen leaves and flowers. Crops are rogued for any plants that may be showing susceptibility to the virus.

Harvest begins in June using a modified potato harvester. This is when the processing factory is at its busiest with between 80-100 staff working two shifts from 7am to 6pm. The bulbs are washed, dried, graded, sorted and packed for export.

The bulbs must be stored at specific temperatures to ensure the quality is kept in tact when they reach their export markets.

Packing involves placing the bulbs in sterilised peat in wooden grates. They are then shipped inside chilled containers to wholesalers in the Northern Hemisphere.

Royal Van Zanten bulbs are exported to Japan, Taiwan, China, Australia, USA and Europe.

Japan is by far the largest market as lilies are popular as a ceremonial flower, particularly in traditional Japanese weddings.

The market is stable, particularly for the Southern Hemisphere, because of the shortfall in the Northern Hemisphere season.

Because the Rakaia operation is contracted to the parent company in Holland it is not subjected to the same difficulties as other New Zealand exporters, who remain at the mercy of the high Kiwi dollar, but it does face the same complexities of getting a quality product into overzealous countries such as Japan.

It is crucial that the bulbs arrive in Japan with no hint of soil contamination. Only 0.01% of soil contamination per kilogram is allowed to enter the country. This is why the company prefers to grow bulbs in soils with little clay content as it can prove costly and time consuming to remove that clay from the bulbs.

To combat some of the more difficult quarantine entry laws into Japan MAF proved helpful in setting up an export protocol in 1999.

Currently Royal Van Zanten trades 70 million bulbs worldwide each year. Of that 20% come from the Southern Hemisphere with 15% from New Zealand and 5% from Chile.

Kees says the company is likely to expand its Southern Hemisphere bulb growing and trading operation by 50% over the next decade. However, the expansion is not likely to be completely within New Zealand and not solely own production.

Although the red tape costs of setting up such an operation were low when the company came to New Zealand in 1998 Kees believes these costs are rising. This makes Chile extremely attractive for future expansion. It is also sound business sense to spread the risk between two countries.

However Keess main objective at present is to consolidate the New Zealand position.