For the 2017 season, the German chips industry has fixed price contracts that are clearly above the average of recent years. Ferdi Buffen, director of potato trading house Weuthen in Schwalmtal, explains which parties and delivery times benefit the most.
The largest price increase goes to growers who can deliver their new harvest early in the season. Weuthen is introducing a sharp adjustment to the contracts, an increase of 25 percent for weeks 27 and 28. For weeks 29 and 30 and the entire month of August, an increase of 15 to 20 percent applies, depending on breed. A contract for the main harvest with Fontane, Challenger or another bulk variety delivered from the field results in an additional price of 15 percent compared to last year. In Limburg and Brabant there has been a transparent pool contract with a floor price for several years, of which this year the floor price has been increased by half a euro.
Weuthen pays Brabant and Limburg growers a surcharge if they contract even more on a fixed price basis. 'Anyone who receives a fixed price premium of 40 euros for 5 tonnes can pocket an extra 35 euros per tonne for a yield of 2,50 tonnes per hectare,' Buffen calculates.
Chip potatoes are also better rewarded in the early weeks. The prices in July, with a plus of 25 percent, are in the same range as the chip potatoes. There is a special allowance for cultivation under plastic of 300 euros per hectare. It shows the great need for very early potatoes.
Due to the seed potato shortage, many new varieties are coming into the picture. For example, there is an extension of Lady Anna. 'For the first time, the variety is included in the Innovator price level, while in other years it was not contracted by us at all. The atmosphere is positive, but seed potatoes are the limiting factor. We also have difficulty supplying the growers. That means that some growers get something different than they want.'
Not only the very early cultivation has a higher reward, late delivery from mechanical cooling in May and June can also add a significant surcharge to all allowances, says Buffen. 'This is to encourage people to keep good potatoes for even longer. In June we will pay a surcharge of 10 euros per tonne.'
Another extra is reserved for high-quality Agria intended for the peeling industry. 'Those who grow quality can achieve considerably higher prices than in the chip industry. For week 17 that is 16 euros for, for example, Cela-Vita or Swiss quality.' Then there are the specific crops such as potatoes from varieties such as Hansa, Jazzy and Regina. They can count on an increase of 15 percent. 'The demand for early bantam from the canning industry in particular has been increasing in recent years. And providing pre-germination containers is also encouraged. Here in Germany all pre-germination containers are full. Growers want prices like that.'
He is also interested in dual-purpose varieties. 'This year the chip industry is the asking party, but another year it will be the export or table market. With a dual-purpose breed you can go both ways. The contract prices are in the same range as the chip prices, including the early ones. Given the supply situation this year, processors have to make concessions on, for example, underwater weight.'
New at Weuthen are the organic contracts for potato chips and fries. 'We are now building up the cultivation areas in the north, south and east of Germany. In the coming years we want to grow to a few hundred hectares.'
In summary, with the extensive package of varieties in the various segments, Weuthen tries to 'offer growers several options on the one hand and, on the other hand, to meet all European customers' needs as best as possible.'