A second lockdown. It was a major setback for the potato processing industry and therefore also for the seed potato market. The sale of seed potatoes is difficult and the demand is considerably less than in other years. Time to look ahead. What can we expect from the seed potato market in 2021?
The seed potato market is currently in... a minor mood. As a result of the coronavirus, sales are difficult and this leads to headaches for both growers and trading houses. For example, it is expected that Algeria and Cuba will only purchase 50% of the 'normal' capacity. But how long will this situation last? The answer to that question is a big question mark for everyone. What is almost certain for many trading companies is that the area of chip varieties will not increase further in 2021.
Chip factories will have a major influence
Whether the area remains stable or decreases depends on the decisions the chip industries make in December. If the processing industry determines that 10% to 15% less must be processed, then the seed potato area must go along with this. Although the hope is of course for a capacity of 100%, this is not a realistic expectation according to various trading houses. Their first feeling is that an area correction is going and must happen. Ferdi Buffen from trading house Weuthen also expressed this expectation end of August out. However, not everyone is so hopeful about this area reduction. According to those insiders, the dreamed area reduction will be difficult to get off the ground if things look brighter again in the spring.
However, there is also some positivity to be found. Out the latest numbers it appears that the processing industries are currently running well again. In September, 318.700 tons were processed into fries and other potato products, an increase of 13% compared to August. The hope now is that this has not been a temporary revival. However, it is not expected that the market will drop as hard as after the first lockdown. Since then, many initiatives have been set up, with takeaway and delivery from restaurants being the largest, which is expected to lead to slightly higher demand from the processing industry.
Demand remains difficult to predict
Whether demand for seed potatoes will fully recover in 2021 is and remains a big question mark above the market. Trading houses find it difficult to estimate this, mainly because it remains uncertain how the corona pandemic will develop. In China and India, for example, the situation has now normalized somewhat and this is also reflected in chip consumption. He is taking significant steps upwards. In Europe we are not there yet and consumption is currently showing a decline. Here, the varieties that prove unsaleable still go to the animal feed industry for a price of €1 or even lower.
In North America, on the other hand, according to the trading houses, they may have responded to that negative mood a bit too early. By reducing the area of chip varieties, the American and Canadian chip factories may only operate for the local market next season. If, for example, the Netherlands can respond to the gaps that this creates, then there is certainly a bright spot on the horizon.