Strategy Accelerate and Strengthen

Together we build sustainable growth

4.1 This is Royal Avebe | How we create value

Royal Avebe is an international cooperative of starch potato growers. We process our members' starch potatoes into high-quality ingredients based on potato starch and protein. We supply these ingredients to customers all over the world. They use our products in food, animal feed and industrial applications. In doing so, we offer innovative and healthy solutions with an increasingly smaller impact on the climate and the environment. Together, we are working on a sustainable food system.

Our members

Our members, our main suppliers, are potato growers in the Netherlands and Germany. We work closely with them to get the best quality starch potatoes. As a cooperative, we find it important to keep developing. Sustainability is a top priority for us. Both in the company and in our members' fields.

Our locations

Avebe has 1,235 employees and six production sites across the Netherlands, Germany and Sweden, and sales offices in North America, Europe and Asia. The head office is located in Veendam (the Netherlands).

Our markets

Avebe develops and produces ingredients based on potato starch and protein for three markets: food, animal feed and industrial applications. Thus, we meet the need for sustainable and healthy products for humans and animals, as well as sustainable industrial solutions. Our customers are all over the world, with major markets in Europe, Asia and North America.

Food

Globally, the market for healthy and plant-based food is growing. In North America and Europe, requirements for food safety, health and sustainability are central. In other parts of the world, availability and affordability are important issues. Our ingredients offer customers opportunities and possibilities to grow in sustainable, plant-based alternatives to meat and dairy. In doing so, a sustainable and transparent production chain gives great added value.

Animal feed

Livestock farming faces a major challenge to produce more sustainably, in a way that is less harmful to the climate and promotes biodiversity. Therefore, livestock farming needs proteins and feed with the smallest possible footprint. The pet food segment is also experiencing strong growth and is expected to continue to grow. With our potato starch and protein portfolio, we offer solutions to improve the nutritional value and texture of both livestock and pet food.

Industrial applicaitons

Potato starch derivatives are used in various industrial products, such as in construction and in making paper and glue. We see a growing interest in sustainable plant-based raw materials for these industrial applications. On the one hand to reduce the use of petrochemical additives, and on the other hand because Avebe's products offer the right functionality. Avebe is successful with, among other things, the introduction of bio-based coatings for food packaging. In addition, there continues to be strong demand for our additives for cement tile adhesives, for example.

Varietal development and crop optimisation

To achieve more sustainable cultivation, it is important that our growers can work with the best starch potato varieties. Our subsidiary Averis focuses on the development, propagation and sale of starch potato varieties. Over the past year, Averis has embarked on an ambitious transformation with the implementation of its new strategy: Route 2020. With this strategy, Averis is focusing on growth, innovation and expansion into new markets. Avebe also supports growers with the Optimeel crop optimisation program. This is how we work towards more sustainable cultivation and a good business economic result for our members.

4.2 Strategy Accelerate and Strengthen 2023-2028 | Introduction

Strengthen together and accelerate agile

With its farmer members, employees and customers, Royal Avebe is now two years into its strategy: Accelerate and Strengthen. Our strategy is a growth strategy in which we emphasise the added and distinctive value of our products. And in doing so, we put the customer at the centre of everything we do. With this strategy, we can make even sharper choices and respond more agilely to the rapidly changing market.

Four pillars

Based on four pillars, we continue to build on our solid foundation towards sustainable growth, innovations in sales and added value for our farmer members, customers and employees. To take substantial steps up in potato payments and remain sustainably relevant for farmer members, customers and society.

1. Strengthen the core

We are expanding the unique functions of potato starch and protein and putting the sustainability of the potato to the widest possible use. We do this by optimising line capacity and a more profitable product portfolio. Reliable and efficient lines, driven by digitalisation and automation, ensure that our cost base is structurally lower and that we increase our productivity.

2. Accelerate plant-based

Where there is a demand for distinctive plant-based alternatives, we offer propositions that contribute to sustainability and (sector) innovations. By using existing production lines flexibly and efficiently, we also reduce our footprint with ingredients for plant-based food and the development of bio-based and circular ingredients for the construction and packaging industries.

3. New horizon

We explore market and cultivation opportunities to use and market all raw materials and applications from the starch potato even more widely, possibly in combination with alternative protein crops. We do this with existing and new technologies. Examples include developing synergy advantages on production lines with alternative protein crops and investigating how to add value to residual streams through fermentation.

4. Heading for more value together

Within the cooperative, we aim for the highest possible outcome for our members, continue to learn and commit to sustainable employability for a profitable future. Heading for more value together means a plus of at least 25 euros on our performance indicator, achieved through the programs we implement during this strategic period. Possible cost increases in potato cultivation are not included in this and should be reflected in a higher price passed on to the market.

With this strategy, we can make even sharper choices and respond more agilely to the rapidly changing market.

4.3 The basis of our strategy: safety, sustainability and innovation

Healthy breeding ground for healthy growth

Safety, sustainability and innovation underpin our strategy and together form our breeding ground. The three themes are woven into everything we do and ensure that Royal Avebe is healthy, stays healthy and continues to grow.

Safety | Safety by nature

With a number of production sites, we fall within the toughest category of the chemical industry. Safety is our top priority and consists of two components: one part is technology, and one part is human behaviour. Where safety cannot be solved with technology or automation, we pay a lot of attention to safety behaviour and culture. We do this with generic or specific training courses and evaluations. In this way, we ensure that everyone knows and understands his or her role. Together, we minimise the risks. Also, when it comes to cyber security. Here, the focus is mainly on behavioural and technological awareness. We deploy cybersecurity on digital security of office environments, telecom, the network and production sites.

Sustainability

Potato cultivation is largely dependent on weather condition and climate. Conversely, cultivation also has an impact on the environment. For these reasons, we are making the cultivation processes more sustainable with more sustainable varieties that have improved disease resistance. And we are working on making cultivation techniques more sustainable. In the production chain, we reduce water use, reduce CO₂ and try to better valorise residual flows. In the market, we respond to the demand for plant-based products and bio-based or circular ingredients for the construction and packaging industries.

Innovation

With technical innovations, digitalisation, better data analysis and use of artificial intelligence (AI), we market our products more efficiently and competitively. Driven by market demand and in cooperation with our customers, we respond better to trends and developments with our innovations. Think of green methods for starch modification or the application of potato protein in new markets.

4.4 Our impact

Together with our members, customers, employees and other stakeholders, we work on the transition to more plant-based, sustainable agriculture and the most efficient production possible. This is how we create social value. Below, we explain the impact from our value creation model.

Towards a more plant-based economy

With our innovative solutions, we offer plant-based alternatives to animal-based foods and proteins. With our specific products for healthy nutrition, we make a positive contribution to the protein transition and to the lives of consumers worldwide.

Together with our members, customers, employees and other stakeholders, we work on the transition to more plant-based, sustainable agriculture and the most efficient production possible

Towards more sustainable agriculture

The agricultural sector has an impact on soil health, biodiversity and water quality. As a cooperative of starch potato growers, we play an important role in this. Together with our farmer members, we work on future-proof agriculture, in which a healthy farm, a healthy soil and a healthy environment (3xH strategic program) are important spearheads. This way, we strive for less environmental impact in our chain and at the same time work on more earning power for our farmer members.

Towards more efficient and sustainable production

We use energy and water to extract starch and protein from potatoes. Through innovative projects and optimising our processes in terms of water and energy consumption, we are reducing our CO₂ emissions and waste streams.