Just like last year, the run-up is tense at the start of this season. A year earlier it was the drought that played a role, now it is the stricter requirements for haulm killing and sprout inhibition. What does this mean for potato contracts?
The potato processor and potato grower absolutely need each other. Yet it feels as if the cultivation contracts for the coming season are handled more rigorously every year. Especially when the previous growing season has been erratic. Ultimately, the soup is never eaten as hot as it is served, as was evident again last year. An area expansion was even possible.
Sector takes a stand
This year too, before most potato processors have finished their contracts, growers and advocates are already taking a stand. For example, the NAV believes that a 15% higher price is required. LTO reacted indignantly after the representative's position vavi that growers themselves are responsible for delivering residue-free potatoes.
It is what has helped to bring the subject into focus news that the first Belgian processor will offer lower prices for the 2020 harvest. Completely contrary to expectations. In both the Netherlands and Belgium, a cost price increase of around 3 euro cents per kilo is mentioned for long-term storage. Only 1 Dutch processor is currently active in contracting. Inquiries with processors in our country reveal that they adjust their prices to current events. The breeds and delivery periods affected are taken into account.
Chapter CIPC
The CIPC (chlorpropham) chapter remains a difficult one, processors also indicate. Not all information is known at this time. Vavi and Belgapom, among others, have asked the European Commission for a temporary MRL increase (tMRL) for CIPC. This standard is now at the minimum detection level of 0,01 ppm. European research in 350 storage sheds shows that a tMRL of 0,4 mg/kilo is realistic. 95% of these barns met this standard last year. Whether this will actually become practice remains to be seen.
How a violation of standards will be dealt with remains unclear. Are these potatoes washed and processed, fermented or burned? Who pays for the costs and what about contractual obligations? The Vavi took another hit challenges that a grower must take good care of his crop, but here too different interpretations are possible. Growers are responsible for cleaning their storage areas, but what is sufficient? Sweep and ventilate, with the steam cleaner or hire a professional company?
Practical tips
The British AHDB Potato is a pioneer in this field in Europe. It has a number of practical tips for growers. Cleaning empty sheds with water at this time is not recommended. The focus should be on making it spotless with the vacuum cleaner. Quite a job, because all walls must be scraped clean of soil and the channels must also be thoroughly cleaned. It is best to let the shed 'vent' by opening shutters and doors. It is best to place boxes outside, because CIPC breaks down faster in the open air and the boxes soak clean automatically.
The seed potato chapter sometimes causes headaches when contracting. This subject will not be touched on quickly this year. The availability of processors is sufficient and strong price corrections are not likely. Only the last few percent are uncertain, due to a disappointing follow-up inspection. It is possible that racial shifts are taking place here.
POC no impact yet
The beginning of 2020 is also in it sign of the Consumer Potato Producers Organization (POC), in which NAV and VTA take the lead. This POC wants to highlight all the previously mentioned points sector-wide, in order to collectively reach agreements with customers. This specifically concerns French fries potatoes. The POC organization hopes to be active for the 2021 harvest year. It has now spoken to all major Dutch customers. Reactions from that side are mixed. LTO Akkerbouw sees more in a grower organization per buyer, so that competition remains between the factories.
Conclusion
Buyers are positive about the expectation that the (contracted) potato area can grow in the Netherlands, but also abroad. The demand is there among growers, it is thought. A reduction in the area of grassland, but also grain and maize, ensures greater availability of land. There is a supply of stoppers or shrinkers, especially in the livestock farming areas in the southeast, east and northeast. In the meantime, Flanders, just like the traditional Dutch growing areas, is becoming packed with potatoes. There are still possibilities in Wallonia. Given the ambitions of various processors, this is also essential, just like the rapidly increasing surface area in Northern France.
Prior to the 2019-2020 season, there was already talk of a monster acreage, potentially resulting in a flood of potatoes. Due to an erratic growing season, this ultimately did not materialize. This fear is also present for the 2020-2021 season. A potato volume of more than 30 million tons oversupplies the EU-5 and causes prices to plummet (see 2017 harvest year). Undoubtedly, 2020 also has its vagaries, with long dry and hot periods and heavy rain. The aim is therefore to achieve broader coverage among processors to ensure sufficient raw materials. This also remains a fine line on which the sector is balancing. We'll know how the penny drops in December.