When you talk about the French fries market, China comes up quickly. The country is seen as the growth market for French fries. Just imagine that those 1,38 billion inhabitants suddenly all start to consume 'a potato with'. However, the higher potato price is causing exports to the country to decline.
Exports of fries and other frozen potato products to China fell sharply in January. This is shown by the most recent export figures, based on the harmonized trading system. Compared to 1 year earlier, exports are half lower.
All major chip suppliers have seen their orders decrease significantly and the number of orders from Dutch processors has even halved. In Belgium, the export level is also half lower, while German chip producers actually benefit; although this concerns smaller volumes. Our eastern neighbors will surpass us in January.
United States remains largest
Despite calls in the United States to no longer buy fries from large fast food chains, the country is and remains the largest supplier. In other words: the Chinese choose fries for their money. The tariff on American fries is 10%, compared to 25% on soybeans. With an export of 80.000 tons in 12 months, the country has managed to slightly expand its exports. The price per tonne increased only minimally.
Belgium has a price advantage on the global French fries market; Roughly speaking, 1 ton of fries from our southern neighbors is more than €200 cheaper than 1 ton from the United States. The Netherlands follows closely and is slightly more expensive, especially in the long term. It is therefore not surprising that Belgian chip exports more than doubled in 12 months. The country is currently lord and master in selling fries.
Turkey strengthens position
As mentioned, Germany is also reaping the benefits of the Chinese market, although their product is priced slightly higher. Turkey is the big winner at the start of 2019, but it must share that success with Canada. In terms of volume, the latter country plays a less important role, while Turkey sold more than 1 tons in 13.000 year. For the Netherlands that is 25.000 tons and Belgium does about double that.
The export market is awaiting further figures, which should show whether the dip in January is temporary. The United States wants to conclude a deal with China as quickly as possible so that their agricultural products can enter the country unhindered. If that doesn't work, Canada can reap the benefits and of course the Europeans.
Turkey and Germany currently benefit from this demand market, which is expected to continue to grow year on year. However, when it comes to price, they cannot keep up with Belgium and the Netherlands. Turkey does have a small logistical advantage; this way it can export fries to China overland.