Inside Potatoes
Potato market ends in a bottleneck
The potato processors and traders are eagerly looking forward to the end of the season. With the closing of week 22, there is still at least 6 weeks to go with potatoes from the old harvest. Everyone realizes that it is going to be tight, although most processors have a strategy for that.
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Choose the subscription that suits youMost Dutch processors seem to have things in reasonable order, but in Belgium the bottom of the potato supply is now in sight. In Northwest Europe, farmers currently have very few freely available potatoes for sale: estimates vary from 15.000 to 30.000 tons. This puts the potato market in a bottleneck, where active purchasing does not yield extra tons. This could cause a price explosion on the market, which has consequences for the delivered kilos and the start of the new season.
Listing of Belgapom
Belgapom's listing on Friday, May 31 was indicative of this. This was unchanged for Fontane and Challenger (€30), with a fixed mood being described. It seems like a consensus that will be maintained until the end of this bottleneck. The Dutch processors want to continue processing the potatoes from the old harvest until week 30, while the Belgians are expected to start processing the early potatoes in week 28. They are prepared to process finer potatoes.
Exports are calmer, which means that the top end of the potato market is declining slightly. In addition, the quality of the potatoes from the old harvest in particular causes exporters to be reluctant to continue exporting old potatoes. In addition, there are also quality problems in the French fries market, but these are still processed.
The chip potato market is between €30 and €32, with the mood being steady (when trading is calm). The quiet trade is mainly caused by a limited supply of potatoes. This is also reflected in the PAT transactions, which are at an unprecedentedly low volume. This week, a total of 595 tons of potatoes were purchased by Dutch processors.
| Delivery | Breed | Price per 100 kilos | Transaction Closing Date | |
| Direct | Innovator | €31,00 | May 31, 2019 | |
| Separating | 40/+ | Off land or shed | Barn | |
| Harvest year | 2018 | Soil type | Clay/Loss | |
| tonnage | 350 | Collected/free | picked up | |
| Direct | Innovator | €31,00 | May 31, 2019 | |
| Separating | 40/+ | Off land or shed | Barn | |
| Harvest year | 2018 | Soil type | Clay/Loss | |
| tonnage | 50 | Collected/free | picked up | |
| Direct | Ramos | €30,50 | May 28, 2019 | |
| Sorting: | 35/+ | Off land or shed | ||
| Harvest year: | 2018 | Soil type | Clay/Loss | |
| Tonnage: | 195 | Collected/free | picked up | |
Futures market remains quiet
The June quotation on the futures market remained quiet. It also seems as if sellers are unwilling to reduce positions early. The best bid on the June contract is €30,40, which is more than €1 below the cash settlement. It is a clear signal that we are waiting for the final cash settlement. If recent quotations are taken into account, the cash settlement should be around €31,30. Next week is the last trading week and then the 2018/2019 season can finally go down as special.
Futures trading for the April contract (2020) is currently in a trading range between €16 and €16,50. Buyers show interest below €16 and hedgers only really want to hedge again at prices around €17. The weather reports lead the day's sentiment. If a little more rain is expected, we will drop. If precipitation is disappointing, the price will rise again.
Increase in area
In general, people are cautious about the increase in area. However, if we look at the developments in the crop, things are no better than last year. The cold spring is leaving its mark and many growers are concerned about moisture management. Now that most of the potatoes are at the top, they are slowly moving towards tuber formation. Moisture is very important.
Rain has fallen in a number of areas, but there is still little soil moisture in the ground. This is a result of the minimal precipitation last winter (after the dry summer). This also means that the moisture disappears in no time. Enough growers are irrigating the potatoes to replenish soil moisture and stimulate tuber formation.
