Inside Potatoes
Potato price rise continues
The potato processors are again very cautious on the potato market. Last week it also became clear that the demand from the export and table potato markets has increased. However, the processors were unwilling to dig deeper at the time and continue to communicate $30 as a maximum price.
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Choose the subscription that suits youThis sentiment has now been broken and a number of processors are already paying significantly more for the sought-after varieties. Arithmetic is currently the most important subject for chip processors. After all, it will accurately determine if/how they make it to the end of the season. The calculation consists of the following ingredients: the potato position, the stock of fries, maintenance and downtime and the availability of early potatoes.
Low stock
Traditionally, processors always keep the chip stock as low as possible in expensive years, in order to enter the new season empty. After all, processors do not want to be left with surpluses of expensive fries. This is also the case this year. At most processors, maintenance and downtime have now been planned, and the supply of old and new potatoes will be arranged around this. Now that the cold spring seems to be causing a delay, a number of processors will need an extra week of old potatoes to keep to the planning.
This creates renewed demand on the market. The credo is to operate carefully. Due to the limited quantity of free potatoes, the market is extremely sensitive. With additional demand, the market can easily rise by €5. In addition, there is certainly a possibility that the last free potatoes will be sold for prices around €35.
Exports are continuing well
The fear that the potato market will ultimately collapse is almost nowhere to be found among market participants. The market is now between €31 and €33 for fries-suitable potatoes, final destination Dutch/Belgian industry.
In the meantime, exports continue to sing along well, table potatoes in particular are currently selling for record prices. In the region around Champagne (France) there are still some free potatoes for sale and these are sold for prices between €55 and €60.
Price above €32?
The futures market for the June 2019 contract appears to be heading for a settlement price that could well exceed €32. Belgapom recorded unchanged on Friday, May 24, but that seems unsustainable in the coming weeks. An increase in this quotation is therefore taken into account. The Netherlands and Germany have already shown this increase.
