The European market for table potatoes is switching to its own production. This means that potatoes from the Mediterranean can hardly be sold. Yet it is a search for a balance between supply and demand. And that will soon be no different for the French fries.
As soon as the first new potatoes become available on the European continent, buyer interest in imported products from countries such as Egypt, Cyprus and Israel will decrease. This year is no different, as Belgian potato trader Johan Kant also notes. "I currently have potatoes from Egypt that are unsellable. There is plenty of supply, there is just a lack of potatoes with firm skin." As a result, it is still necessary to find sufficient 'local' supply to meet demand and that has an effect on price formation.
Poor Spanish harvest
Traditionally, the first new potatoes in Europe come from Spain and France. The first very early batches were harvested there at the end of April and beginning of May. However, due to cold and rain during the growing season, it was already predicted that the Spanish yield would be significantly lower this year than in 2019 and that has come true. Rain in May added to that. Growers are faced with problems with Phytophthora and Rhizoctonia.
The disappointing quality hindered a good harvest. The initial relatively good prices, therefore sank away. Growers sometimes even have to settle for minimum prices between €8 and €12 per 100 kilos. Partly because of this, the early harvest in Andalusia came to an end in the second half of June, much earlier than normal. It is reported that 18 to 20% of the potatoes in this region are not harvested at all.
Prices are rising slightly
Nevertheless, prices for Spanish potatoes in Western Europe rose again in the past week, market analysts report. These would be prices between €30 and €50 per 100 kilos, delivered free of charge. The latter has to do with the fact that the supply from our own country is still sparse or not structural enough. Germany is a good example of this. Supermarkets across the country have now switched to domestic production, but are currently having difficulty filling their shelves.
The yield of early potatoes in Germany is mediocre in many places due to the drought. At the same time, ripening is slower than normal. When it comes to potatoes with a firm skin, there is currently a shortage. "Potatoes with a firm skin are much more popular because of their better shelf life," says Kant. "The current supply of table potatoes, also from countries such as Belgium and the Netherlands, mainly concerns potatoes with loose skin."
More stability
Potatoes with a firm skin are therefore reasonably priced. According to Agrarzeitung, €42 to €44 per 100 kilos were paid in Germany at the beginning of this week. In Austria, where good yields are reported, prices are lower. In the coming weeks, the supply will increase and become more in balance with the demand for skin-resistant potatoes. The price will then drop slightly, but expectedly less sharply than in other years, because the European supply is not abundant.
Transition in the chip market will be exciting
In the meantime, attention is also focused on the supply of early chip potatoes. It is expected to be released at the end of July. However, it remains to be seen whether the market is ready for this. Processors' cold stores are full to the brim as a result of the corona crisis and stagnant sales.
The large stock of old harvest seems to be hindering a smooth transition to the new harvest. At the same time, the early supply will not be disappointing given the current area forecasts and excellent crop development in many places. "In addition, South American countries are purchasing far fewer pre-fried fries due to the corona outbreaks. All in all, things look bleak," says Kant. "We are not faced with an easy task."