Due to persistent drought in large parts of Canada, the expected potato harvest for this season is 8% lower than last year. The regions of Prince Edward Island, New Brunswick and Alberta in particular have to make significant sacrifices due to challenging conditions. The harvest in the United States (combined with smaller acreage) is also considerably lower. Perhaps the 'gaps' will offer opportunities for the potato market in Europe later in the season.
The Canadian potato harvest for the 2020 season will amount to 4,4 million tons, according to insiders. This is 8% less than last season's 4,8 million tons. It would be the lowest yield since 2011. Due to persistent drought, the forecast has been adjusted downwards by more than 400.000 tons compared to August. It is striking that the area is 14% larger this season: 145.120 hectares. The fact that the yield is significantly lower is mainly due to a lower hectare yield: 30,3 tons per hectare in the 2020 season versus almost 35 tons per hectare in the 2019 season.
Does it offer opportunities?
The potato harvest is not only declining considerably in Canada, because the harvest is also expected to be considerably smaller in the United States. While an average of more than 2018 million tons was harvested in the 2019 and 19,3 harvest years, this year, according to the latest expectations, this year will be about 1 million tons less. That is also 400.000 tons less than forecast earlier in the growing season.
The question now is whether the 2020/2021 season will create opportunities to ship part of the intended surplus of raw material (and therefore end product) in the European market to the United States. The currently weak dollar exchange rate is a limitation for processors producing in the euro countries. Yet in the month of July alone, the United States imported almost 16% more pre-baked products than 1 year ago.
More than 9.000 tons were exported from Belgium alone. In June this was even more than 12.000 tons. Belgium and the Netherlands jointly exported 2019 tons of pre-baked product from August 2020 to July 135.000, compared to 83.000 tons over the comparable period a year ago.
End product at a high level
Demand from the United States is also reflected in Canadian export figures for finished products. They are almost at the level they were before the corona crisis. For example, in the month of July (compared to July 2019), the United States imported 10% more pre-baked product. This trend (larger sales of end products to America) is all the more interesting, given the significantly lower potato harvest in Canada.
In short: the 'gaps' that may appear on the other side of the pond could come in handy for the European market. The price-wise European market, which has been thrown off balance by corona, may well recover faster than expected by mid-2021.