A new bonus-malus system for potato quality should reward potato growers at Aviko Potato above average. Those who deliver top quality will score a contract price that is above the level of 2017.
For the 2018 season, the basic price of the fixed price contract with Aviko Potato will be subject to a small reduction. Off land this is €0,60 to €0,85 per 100 kilos. Dry from the shed, the reduction is €0,35 to €0,60 per 100 kilos. The price difference between the A and triple A variety groups has increased from €1,25 to €1,50 per 100 kilos.
This choice fits within the company's strategy, by focusing on higher raw material quality. As with other processors, the focus is on delivery from long-term storage and less in the field period. Last year elevated the processor all contracts on average by €1.
off country
For country delivery, Aviko pays €9,15 per 100 kilos for the A group with Fontane and Bintje. Group AA (Lady Amarilla and Miranda) is €9,90 per 100 kilos and the AAA group (Agria, Innovator, Zorba) is €10,65 per 100 kilos, including a bonus of €0,50 per 100 kilo for delivery of at least 40 tons per hectare at a fixed price. For the Fontane variety, this limit is 45 tons per hectare.
Dry from the shed
In week 17, the last week of April, the overview for the 3 groups looks as follows: €13,37 per 100 kilos for group A and €14,87 in the triple-A group. At the end of the season (week 26) the price is €15,50 and €17. This concerns the basic price for 40 millimeters upwards, including a previously mentioned bonus of €0,50 per 100 kilos.
Various agreements are possible for kilos outside the contract. In addition to free trading, Aviko offers a pool, a click contract or payout based on the market price. Anyone who wants to secure their full yield can use the hectare contract. A 3-year contract results in an additional price of €0,25 per 100 kilos.
Bonus-malus system
The biggest change in the contract is the bonus-malus system. This replaces the old quality surcharge. The aim is to create a direct link between the returns in the factories and the grower's payment price. In this way, the processor tries to achieve a better quality end product, the market value of which is higher. Growers receive 50% of this benefit. Aviko has combined data from 10 years to arrive at an average for the system.
The system assesses on 4 categories: points, coarseness, body color and underwater weight. Aviko increases the limit for points from 50 to 65. Above 50 points of damage (the current rejection limit), a discount (malus) is charged, provided the potatoes are processable. The bonus for a low number of points is a maximum of €0,40 per 100 kilos.
The bonus for coarseness only applies to Innovator and Zorba, which cut extra long fries. The maximum additional price is €0,75 per 100 kilos. The number of tubers is taken into account. The standard used is 5,5 to 6 tubers per kilo. A good game gets a penalty.
Underwater weight
The largest bonus is achievable on the underwater weight (OWG): a maximum of €1,50 per 100 kilos. The discount for an OWG below 380 amounts to a maximum of €0,60 per 100 kilos. Potatoes with a high dry matter content yield more fries per kilo and therefore more yield.
Aviko hopes to encourage growers to focus more on this, so that the raw material quality, the factory yield and the quality of the end product increase. For baking color, a bonus of a maximum of €0,50 per 100 kilos and a penalty of €0,20 per 100 kilos applies. This mainly focuses on the homogeneity of the party.
No no claims
The bonus-malus system is mainly known from car insurance. This also allows you to build up a no-claim discount. Aviko has not yet built in such a rule. This cannot be ruled out for the future. The reward system was established after intensive consultation with the Potato Growers Committee (ATC). If you receive the maximum bonus, the payout price will exceed that of 2017. This is the case, among other things, for coarse Innovator's with a high OWG.
Seed potatoes
The company is keeping seed potato prices stable this year. Availability has improved compared to last year. Quality remains a continuous process that Aviko works on together with the entire sector. Since this year, efforts have been made to ensure that extradition proceeds more smoothly. Including by using a storage scale for early delivery.
The need for potatoes, which arose in the Netherlands last year after capacity expansion, has been sufficiently met for 2018. The volume continues to grow steadily across the board. In addition to chip potatoes, this also applies to potatoes with a high dry matter content, for the production of flakes. Aviko's potato needs are growing for 2018, mainly due to the significant capacity expansion in southern Germany.