The mood for the coming potato season seems to differ between growers and buyers. Growers see the potatoes from the main harvest developing optimally, buyers see a possible shortage of raw materials. How does this translate on the potato market?
After the difficult start in May, the potato crop entered a period of growth after that time. There will also be no real summer weather in almost the entire EU-4 next week. The leaf equipment is now working very well, the next step for the crop is to invest in the kilos. This thought is logical, but a warm and dry period can change the situation considerably. Especially because the potatoes are spoiled in most cases, often resulting in many tubers.
Hungry for fries
That is precisely what customers are alert to in a world that will hopefully soon enter a post-corona stage and that is hungry for fries. Add to this the EU-4 shrinkage of the potato area and the enormous expansion of processing capacity in recent years (more than €4 billion invested in Europe in less than 2,5 years) and a shortage of raw materials can quickly arise. This also explains the current firm bottom between the €15,50 and €16,50 level of the futures market for the April 2022 quotation.{{dataviewSnapshot(6_1625868350)}}
We have now completed week 27, in which the market often chooses direction. It seems that the moment has been pushed back a bit, think of the first half of August. It may also be that the time to choose direction was at €15,90/16,00 last week. And that a bottom has been hit there, which may also apply to the rest.
Continue on old for longer
Based on the analysis published earlier this week (price range €14,00 to €20,00) this may well be possible. However, if there is a hitch in the (growth) cable in the coming weeks, a price range of €18,00 to €25,00 is not inconceivable.
There was certainly a hitch in the (growth) cable in the cultivation of early potatoes, which did not achieve normal yields in terms of kilos and underwater weight. Customers are considering what to do in the coming weeks. Continuing with the old harvest for longer can be a great option. The fact is that the market price of old potatoes suitable for fries seems to be set in stone between €10,00 and €11,50. If the old market continues to operate for longer, a 'jump' in the market price to €15,00 remains not unthinkable, but to be honest, there are no concrete signals of this today (end of week 27). One thing is certain: the potatoes from the 2020 harvest will all be consumed.