Dutch food company HAK to pause operations in January as energy costs bite

AMSTERDAM (Reuters) - HAK, a major seller of conserved foods such as peas, beans and apple sauce in the Netherlands, is to temporarily halt production this winter due to high energy costs, with a spokesperson saying the pause would last six weeks from January.

Dutch national broadcaster NOS cited HAK director Timo Hoogeboom as saying the decision would not lead to empty grocery store shelves as the company keeps extra supply in case of disruption.

A household name in the Netherlands, HAK was sold to Russia's KDV Group by NPM Capital last year for an undisclosed sum.

According to Dutch Chamber of Commerce records, HAK and related companies had sales of 100.2 million euros ($98 million) and operating profit of 10.2 million euros in 2021.

"If companies have to sell under their cost price for months on end, then things will turn out badly," NOS further quoted Hoogeboom as saying.

Earlier on Monday the Union of Dutch Fruit and Vegetable Processors (VIGEF) called for the government to either impose a cap on gas prices, as Germany has done, or offer support for companies.

"It's of importance to do this in line with other countries around us, to guarantee the continued existence of this industry and its supply chain, and to ensure that healthy food from Dutch soil remains affordable and available," VIGEF said.

Food packed in cans and jars is usually heated to help reduce the need for artificial preservatives.

In addition, VIGEF estimated that the cost of metal and glass used in such packaging has risen to 25-35% of its members costs, from 5%, while farmers are also struggling with higher fertiliser prices among other rising costs.

"It is not possible to keep absorbing these costs," VIGEF said.

($1 = 1.0233 euros)

(Reporting by Toby Sterling; Editing by Kirsten Donovan)