Raw Material Crisis: Peat Shortage Hits Dutch Substrate Industry Hard

Raw Material Crisis: Peat Shortage Hits Dutch Substrate Industry Hard

The West European substrate market is currently facing a significant challenge as key raw materials, particularly peat and coir, reach historically low supply levels. This crisis is primarily driven by persistent bad weather in crucial producing regions and an insatiable global demand that has surged, especially from Asia. The Dutch Association of Potting Soil and Substrate Producers (VPN) is ringing alarm bells over the ramifications these shortages will have on the Dutch substrate industry in the upcoming year, with serious challenges looming on the horizon.

Heavy rainfall in the Baltic States, Finland, and Sweden from May to July 2025 has drastically hampered peat harvesting capabilities. VPN reports that this year’s expected peat harvest will be only between 40-50% of normal volumes. Even more concerning, white peat, a distinct type used in various horticultural applications, is projected to see harvest levels dip to just 25-35% of what we would typically expect. As the bulk of peat for Dutch substrate companies originates from these regions, the implications are significant.

What Is Peat and Its Importance?

But why is peat so important in the first place? Peat is an organic material formed over thousands of years from partially decayed vegetation in waterlogged conditions, making it a vital carbon sink. With global peatlands covering roughly 3.7 million square kilometers, they act as significant reservoirs of organic carbon, storing over 600 gigatonnes of carbon—more than all other vegetation types combined. This unique ecosystem is not just a simple growing medium; it’s a crucial player in climate regulation and biodiversity preservation.

Peat is predominantly found in bogs and fens, formed in wetland environments. Its composition often includes Sphagnum moss, contributing to its acidic nature and fibrous texture, which allows it to retain up to 90% water. This makes peat invaluable across various horticultural practices, particularly in gardening, where it helps improve water retention and nutrient availability.

Challenges and Opportunities

Despite growing demand for renewable raw materials, such as bark and wood fiber, these alternatives frequently fall short in terms of consistent quality and volume. The current trend, compounded by variables like climate change and geopolitical uncertainties, highlights the need for the Dutch and broader European horticulture sectors to reassess their sourcing strategies for raw materials. As we look ahead, VPN emphasizes the importance of early communication between potting soil suppliers and buyers to safeguard product quantity and quality amidst this unpredictable landscape.

Factors affecting peat availability extend beyond immediate weather issues. Global demands are expected to skyrocket, with projections forecasting a staggering 400% increase in substrate demand by 2050 compared to 2020. Notably, China’s expanding covered horticulture area is significantly influencing raw material availability on a global scale. In countries like Latvia and Canada, where peat extraction is common, the practices and regulations surrounding it vary greatly. While some nations impose strict guidelines to protect peatlands, others, like Ireland, have already put a ban on peat harvesting.

The situation is indeed pressing. While there may be a slight recovery in peat harvesting by the end of August, experts warn that the backlog cannot be entirely made up. As the substrate market navigates these turbulent waters, updates from VPN on market developments and their implications for substrate production are anticipated later this month.

As local communities and businesses grapple with these challenges, there’s something to be said for the resilience and adaptability required. In times of crisis, proactive engagement and innovation within the horticultural sector may well provide the answer for sustaining the demand while addressing environmental concerns. After all, this is not just about growing plants; it’s about nurturing our planet. For those in the horticultural industry, keeping a close watch on these developments will be paramount as we head into the future.