'2017 potato harvest not cost-covering'

At the end of August the potato market is very different than was thought a few months earlier. Buffen points to several causes for this. This means that every potato was used, even if it was of questionable quality. Dual-purpose varieties entered potato processing en masse, a significant volume of raw material was extracted from Poland, additional growing areas in Bordeaux, Italy, Spain and early German areas were tapped and expansion was encouraged in the important growing areas with exceptionally good contract prices. But night frost at the end of April and extreme drought pushed up the futures market and fueled hopes for a third year of high prices.

Bright spots
The current reality is different. The futures market is trading at €7 on April 2018. Positivity about the future is therefore hard to find. Yet the German still sees some bright spots. "The sales and processing of early varieties has largely been completed. These varieties showed their good industrial qualities. The industry is currently on schedule. It is the starch industry that has been purchasing large quantities of industrial potatoes in recent weeks. The low raw material prices offer European factories, despite the unfavorable euro-dollar exchange rate, opportunities all over the world. Even if the new production capacity is not fully utilized, global demand for potato products will continue to rise."

How many potatoes will there be?
The key question now is: how many potatoes will be produced in 2017? Buffering assumes an above-average yield in almost all areas. "A large part of which is in large size and of good processing quality. Also in areas that suffered from extreme drought earlier in the growing season. However, I do not expect such a large harvest as in 2014." 

However, he considers the quality in some regions to be worrying. "There are many lots in the Netherlands and Belgium that have been washed through, especially in Bintje. Furthermore, the underwater weight sometimes leaves much to be desired and hollowness is sometimes noted."

Historically large contract volume
Assuming that the entire potato harvest is harvested, Buffen estimates that the German harvest will be between 11 and 11,5 million tons. His forecast for the EU-5 is 27,5 to 28,5 million tons and the EU-15 at 44 to 45 million tons. "To provide a price forecast, it must be taken into account that the industry has contracted a historic quantity of potatoes. On the other free market for French fries potatoes, I do not expect high demand until mid-November. For September/October you should think of prices of €3 to €5. According to him, top parties do not have to count on high premiums. It is a price level at which potatoes could also enter the starch industry, so that the worst may be over by the end of November."

Storage potatoes do not cover costs
The gloomy mood is also reflected in his forecast for storage potatoes. "The prices will not cover costs." For January to June, the director assumes a price range between €7 and €10. "But at the end of the season the market can turn out completely differently than we currently suspect," he notes.

"Deliberate planting, cultivation restrictions and unforeseen weather influences have taught us this in the past. But with what we know now, I can imagine that the demand for early potatoes will start later in 2018."

Director Ferdi Buffen of the German trading house weuthen Thursday during the Kartoffel Day 2017.