With a bid of €14,50 and a quote of €15,30, the first trade (2 contracts) was made at €15. Nothing is yet known about the 2021 harvest year, the course of the 2020/2021 season is leading.
The current chip potato market is in a more than difficult situation due to the corona crisis. The settlement of the 2019 harvest is proceeding at a disastrously low price level. A large portion of the potatoes still in stock ultimately do not end up at their original destination (chip processing), but in the cow's mouth, among other places.
Compensation scheme floating around
Yet it was striking that - with 4 weeks to go before settlement of the 2019 futures market harvest and a cash settlement (CS) of €1,90 - the June quote rose to €7 today (Thursday, May 3). The cause of this movement can be found in the uncertainty about the development of the market in the coming weeks as a result of the compensation scheme applicable in the Netherlands.
If the still running chip lines need to be supplied with raw materials, it is not illogical that these potatoes generally do not come from the Netherlands. Since these potatoes (from the Netherlands) must end up elsewhere (such as animal feed) to qualify for the scheme. As bizarre as this sounds, it is difficult to buy potatoes in the open market.
Weather becomes crucial
Incidentally, the April 2021 quotation rose today to €11,40 as a result of the persistently dry weather, while it was still trading at €9,50 at the beginning of the week.
Negative sentiment dominates this quotation on the potato futures market due to the corona crisis. The fact is that the growing season of the 2020 harvest has yet to start and that in any case the weather will play a determining role in the coming months. If the dry weather continues in the coming weeks and we enter a heat wave in mid-June, for example, this could have an effect on the mood and therefore the price development of the April 2021 quotation.