While the physical potato market is clearly a demand market and the market is rising, the stock of French table and chips potatoes remains at an unprecedented level. This is evident from figures from growers' organization UNPT. The stock of chips potatoes in particular is significantly higher due to a large harvest and less demand until the beginning of this year. What does that do to the acreage?
The stock figures that UNPT has published are now 8 weeks old, so the reality is different. On the reference date 1 January, the French potato stock was 3,5 million tons according to member statements. That is a record and considerably more than in the past 2 years. In the top harvest year 2017, the level was 3,1 million tons.
Lots of free potatoes
The stock is divided into 2,1 million tons of chips potatoes and 1,4 million tons of table potatoes. The stock of chips potato in particular is unprecedentedly high. In 2017, that was 1,7 million tons. Compared to a year earlier, the stock is 400.000 tons higher. Potato growers mainly have more free potatoes in storage. According to UNPT, nearly 500.000 tons of French fries are still unsold. A year earlier that was 200.000 tons.
According to the organization, a significantly higher potato stock at the start of 2021 is mainly due to a larger area and larger harvest. Agricultural statistics service Agreste estimates French potato production at almost 7 million tons. UNPT does not fully agree with this and arrives at 6,758 million tons. An increase of 3,5% compared to the previous year. The acreage grew by 2.190 hectares.
Hectare yield difference little
The hectare yields do not even differ that much compared to 2019. They are marginally higher. Only the Champagne-Ardennes region stands out. The yield there went from 48,5 to 52 tons per hectare on average, resulting in an increase of almost 12%. Mainly table potatoes are grown in this area. The areas concerned with French fries (Nord Pas de Calais and Picardy) see a 1% increase and a 0,5% decrease in yield.
The French RNM quotation for other varieties made a step from €5,00 to €6,00 per 100 kilos at the beginning of February and doubled at the start of this year. This means that the French are still trading at €1,50 below the Belgian price level of the Belgapom quotation. In Northern France many potatoes are stored for Belgian processors, or French potatoes are stored in Belgium. These are included in the French figures.
Lots of stock, no offer
Processors are clearly looking for potatoes, but even with almost 20% more free stock, there is hardly any supply. Those facts are hard to match. That is why there are also insiders who speak of a ghost stock. The idea is that French potato growers have concluded tons of contracts, but in the end planted more tightly. As a result, the contract can be delivered just full. That idea doesn't rhyme with the numbers.
Another idea is that growers have now incurred a lot of costs for, among other things, the sprout inhibition and therefore do not want to say goodbye at this price level. They see good processing and export figures and a rising market due to their tenacity. It will therefore be interesting to see what the stock figures will look like this spring. Meanwhile, the costs for sprout inhibition are piling up. Low temperatures ensure that most batches hold up well in storage. If the weather warms up, more parties may have to say goodbye.
Much more wheat
With low grain and beet prices, and problems with rapeseed cultivation, French arable farmers opted to grow more potatoes last year. A picture that has been visible for years, prompted by stable demand from the Western European potato industry. With undiminished expansion plans of processors, there will be no end to this for the time being. Decreased contract prices, sharply increased cost prices and possibly a larger (free) potato stock could influence the choice this spring.
Market bureau Stratègie Grains estimates the area of winter wheat in the country at 6,72 million hectares. An increase of 770.000 hectares compared to last year. Partly because better weather conditions allowed more winter grain to be sown, but undoubtedly also prompted by the increased wheat prices. The rapeseed acreage is falling again, by 100.000 hectares. Now that French arable farmers have access to neonics-coated seed, the beet acreage is falling less than expected. Based on these figures, a stabilization of the French potato area is likely.
It should be noted that arable farms that have made the choice to grow potatoes have often seriously invested in this. In machines and in storage capacity. Even at a wheat price of €250,00, they are not quick to switch. In the meantime, NEPG and UNPT are calling on growers not to sign contracts below cost.