How do the factories organize their last supply?

Week 20 brought about a further increase in the physical market. With at least 8 weeks to go, it is time to count for the large consumers of potatoes. The cold start to the growing season seems to mean that the 2016 harvest will require at least 10 days longer work than with a normal to good start for early potatoes.

Germany plays the most important role in this regard, looking at their area of ​​early potatoes. The processing industry, but also the growers, had already responded to the tightness of the current season by achieving growth in acreage and higher contract prices. A number of processors have also set up cultivations in the south of France to supply early potatoes from there. It is interesting to see how the different countries are currently pursuing their strategies.

France
The price in France has risen rapidly over the past week. They have been ahead in price formation all year long and the French recorded the higher prices. The market in France is tight due to very low yields and high contract volumes. Freely available potatoes are scarce and good demand has been created by exports to Southern Europe.

Demand from Southern Europe now seems to be disappearing. This is due to the availability of their own harvest. Yet the price is rising in France (RNM 25 euros). The processors from Belgium and France are looking for the last freely available potatoes, because they also want to have coverage for that.

Belgium
The Belgian potato market shows that the search for the last free potatoes has also begun there. With a price increase of 25 percent for Belgapom, the Belgian market already sent a clear signal. Market experts from Belgium report that there is a good demand for free potatoes.

The listing of PCA/FIWAP also gave a clear signal of this. This became visible once again through rising prices, even to 30 euros at the top. Factories still try to buy for 26 to 27 euros free, but traders (who again have delivery obligations to processors) clearly pay more. The top varieties Agria and Markies in particular are easily traded for 30 euros.

The market in Belgium is comparable to that of the 2012/2013 season, when prices quickly rose to 35 euros from mid-May. The Belgian (free) grower is very determined and intends to sell the potatoes for even higher prices, mainly using the argument of "compensation for the low yield and high costs". The development of the early potatoes and the stock of pre-fried fries will determine whether they are right.

Germany
As has been the case all season, the German market continues to radiate the most tranquility. Rising prices are reported, but not in a panicky manner. The fact that the German market has suffered the least from low yields and mediocre quality is once again highlighted.

Increased demand from the German manufacturing industry is reported, but they appear unwilling to buy them at any price. Transactions of 30 euros are not reported here. The extra demand is mainly focused on quality potatoes. The German processors seem to have it best.

The Netherlands
The Dutch processors seem to be doing better than their Belgian colleagues. Despite the increase in the market, it is not the processors who are driving up the market, but mainly the trade. These are purchased at significantly higher prices, often for specific destinations for higher quality segments. The Dutch processors are uncomfortable because of the large quantity of "along-supply potatoes" that they have to pay for every week.

Research explains tension
An English research agency has calculated that this would amount to 25.000 tons per week. This also explains the tension that always exists on the various quotations in the Netherlands (Rotterdam, Goes and Emmeloord).

Compared to the foreign markets, the bottom of the quotation remains remarkably low at 22,50 euros. The market reports that not a single kilo of free potatoes is for sale. The Dutch processors are also busy calculating whether the connection will be achieved. And whether people still need to buy free potatoes and at what price. This will determine whether the factories will be closed earlier for maintenance and whether fries will be supplied from stock.