Potato market sighs and takes a breather

Nevertheless, the first potatoes are emerging and the early plots are growing well. However, in the south-west of the Netherlands, problems are reported in the early plots, which is said to be the result of the large size amounts of precipitation end of April. Some growers report poor emergence and rotten seed potatoes. Such signals also come from Germany.

(Text continues below the image) Poor attendance and rot are reported - Source: M. Schippers (via Twitter). 

Pricing
There is still a battle going on regarding price formation for the old harvest. After settling the April contract on the Cash Settlement at €5,80, the genie seems quite out of the bottle. While a vote was taken at the beginning of April due to a later spring, and the resulting good demand for Innovator and Fontane, among others, today can be called quiet, to say the least.

Growers who store for a long time, but do not have mechanical cooling, see temperatures rise in storage. It warm weather ensures an accelerated supply. In April, many chip processors moved the good and contracted batches to a later delivery in the season, in order to complete coverage before the end of the season as much as possible.

The credo was to buy more in April (at short notice) to create coverage for later in the season. Less than 2 weeks later, this seems to have returned to the market like a boomerang. The stock figures of Fiwap/PCA, as well as that of VTA, ensure a further decline in the market.

Going full speed with potatoes
By the way, it still is drove full throttle with potatoes that have difficulty finding their way to the chip processors. With the last week of the Avebe campaign approaching, many parties for which there is no room due to quality are being brought in at an accelerated pace. The current prices of potatoes currently vary from €0 to Avebe to €7 per 100 kilos for super hard, well-baked Innovators to the processors.

In general, the processors have reduced their purchasing prices from €0,50 to €1 for the co-delivered potatoes. Belgapom's quote for week 19 was telling (no quote for Challenger/Fontane due to too few transactions). This also accelerated the supply on the futures market.

The premium that was included in the June contract (June quoted €3 10,10 weeks ago, which yielded a premium of €4,20 compared to the Cash Settlement), has therefore disappeared like snow in the sun. There is now even a negative expected value (the June futures market close is €5,50 and the Cash Settlement is €5,70). In the short term, the physical market seems unable to recover, and with that the final June Cash Settlement is quickly approaching (June 1).

Long-term keepers
Whether the long-term keepers will pay for the laughter again remains to be seen. The battle for the connection will only take place from mid-June to mid-July. Most processors only plan early potatoes in week 30 (normally week 27/28). The question will be whether the first potatoes are worthy of processing. The same applies to the old potatoes. According to the calculations, there will still be sufficient stock (harvest 2017). However, the big question is whether the quality is adequate.The June quotation on the potato futures market.