Shocking trend reversal in potato acreage

At the end of last year - before contracting the 2021 harvest - a small decline in the European potato area was estimated within the potato sector, from 2% to a maximum of 5%. An analysis by DCA's market experts shows that this situation has reversed. In Northwest Europe, a shrinkage of 6% to 9% is assumed. This is still less than what advocates such as NEPG call for. They aim for a decline of at least 15%.

Decline in new growing areas
The largest decrease in the area of ​​chip potatoes for the main harvest of 2021 is expected in the relatively new cultivation areas: Wallonia and Northern France. A less significant decline is expected in the Netherlands and Flanders. Germany, the United Kingdom and Poland are in between these 2 scenarios.

In Germany, potato growers are increasingly opting for table potatoes. Starch potato cultivation is also proving stable. The mid-early segment is expected to shrink in Germany and Belgium. Varieties such as Signora, Zorba and Felsina are decreasing in area, based on a reduced demand for seed potatoes. Growers are more likely to choose a variety like Fontane. This can be delivered ex-land or stored, if the market requires this. Seeds of this variety find a good place in Europe. Another factor is declining interest in the Innovator variety. This variety is popular with processors, but the hectare yield has been disappointing for many growers over the last 3 years. You see this all over Europe.

Processing isn't too bad
There is also uncertainty for potato processors in 2021. They have had a turbulent year with deep valleys. If we take stock, the declines in processing figures are less significant than previously expected. In the Netherlands, 10,5% less was processed (3,4 million tons) and in Belgium 4% less (5,08 million tons). Several processors are also committed to growing their production capacity by expanding existing factories or building new ones. They therefore look for stability in their contracts, but at a lower price level.

Netherlands: more wheat on clay
The consumption potato area is expected to decrease by 3% to 5%. This means a decrease from 2.275 to 3.780 hectares, after which the total amounts to 72.000 to 73.500 hectares. In the clay growing areas, arable farmers have sown slightly more winter wheat, prompted by a stable price level. In the southeast and east of the Netherlands, maize is more likely to be chosen, or arable farmers are more likely to pioneer a crop such as onions. The supply of rental land here is described as ample, which is why 'fortune seekers' sometimes take their chance. The area of ​​starch potatoes remains stable. This segment enjoys positive demand. This also applies to flake potatoes. However, a price drop is sometimes also visible in these contracts.

Belgium: mainly decline in Wallonia
In Flanders, the potato area traditionally fluctuates moderately. DCA therefore assumes a decrease of between 3% and 5%. This is different in Wallonia. Large potato growers in particular are cutting back on cultivation there. A reduction of 10% is considered possible. Due to the wait-and-see attitude of their tenants, landowners have chosen to sow grain more often. In addition, some growers have problems meeting their financial obligations. As a result, landowners are reluctant to rent out land.

France: arable farmer chooses certainty
Just like in French-speaking Belgium, French arable farmers are more likely to choose grains in their cropping plan this season. The risks are low and the positive price development on the grain market ensures improved financial income. Now that French arable farmers have access to neonics-coated seed, the area of ​​sugar beet is also declining much less than previously estimated. After a long wait, potato growers have received a little support for the 2020 harvest. They are also faced with a significantly higher cost price due to the disappearance of CIPC. The contract price is at a slightly higher level in Northern France, but this does not convince everyone.{{dataviewSnapshot(2_1614950988)}}

Germany: shift in races
The movement of the area in Germany is between the countries mentioned earlier. Estimated to be around 5%. The starch and table potatoes segments remain stable. The largest shrinkage is expected for French fries potatoes. A multifunctional variety such as Fontane is often chosen that can be widely used in all delivery periods. In the south-west of Germany, more and more arable farmers are choosing to try their luck in onion cultivation. Beet cultivation in Germany has also gained more hope now that an exemption for neonics-coated seed has been achieved locally. More winter grain was sown last autumn.

Poland: Difficult years have an effect
The Polish potato sector has had a series of difficult years. In 2018 and 2019 there were crop failures due to severe drought. 2020 started off historically dry, but rain fell on time, which made yields good. According to official figures, the area grew by 5% to 325.000 hectares. This growth will most likely be lost again this year. Large chip potato growers in particular are scaling down their acreage because the contracts are not sufficiently cost-effective. The first year without CIPC is a hard blow for many. The drug was difficult to obtain and there is no experience. Moreover, not all storage sheds are suitable.

United Kingdom: French fries stable factor
Potato growers in particular who supply products to fish & chip shops for fresh fries see their trade evaporate. The cultivation of chip potatoes for processors takes place almost entirely under contract. Growers can handle this well. These professional companies keep the area stable. Small farms in particular are cutting back and sowing more grain. The area is estimated to decrease by 2% to 2,5%. This brings the total potato cultivation to 106.000 and 120.000 hectares.

In 2020, the area under consumption potatoes in the EU-5 amounted to 652.790 hectares. With a decrease of 6% to 9%, this will amount to 2021 to 614.000 hectares for 594.000. In absolute figures, the largest shrinkage is in Germany (10.300 ha) and France (19.680 ha). The EU-5 area will thus drop back to a level we saw in 2016 or 2017. This means that with an average hectare yield of 45 tons we are talking about 27 million tons of potatoes. With a volume of 28 million tons, the European market is in balance, which means that processors have enough potatoes and the market is healthy.

Conclusions:

• EU-5 area is estimated to decline by 6% to 9%
• Largest absolute decline in France and Germany
• Dutch area slightly lower
• With an average harvest the market is healthy
• Mainly more grain was sown instead of potatoes