At the end of the season, it is always a matter of trial and error when it comes to the stock position at the various processors. When can a switch be made to new potatoes and how long can old harvest potatoes be processed?
Normally, processors and growers aim to switch to new potatoes from week 27. First for the fresh fries segment and then for the frozen fries segment. It has become clear in recent years that this is entirely dependent on nature. This is increasingly proving to be unfeasible and processors have to continue processing old harvest potatoes for longer.
Long-term storage without chlorine
Then it comes down to stock and quality management of potatoes in storage. Encouraged by processors, growers who store for a long time have invested in mechanical cooling in recent years, which allows for better and longer storage. With the disappearance of CIPC, this still seemed a challenge, but this year too the long-term storekeepers managed to deliver good baking-worthy potatoes from the shed in weeks 29 and 30.
The combination of MH spraying and 1,4 Sight appears to be the most successful combination. This combined with very stable storage temperatures through mechanical cooling makes it possible to store potatoes all the way into August. Last year it turned out that you can go far, due to limited sales due to Covid-19, and old harvest potatoes were processed up to week 34.
Because old potatoes can be grown for so long, the cultivation of early potatoes has come under more pressure in terms of acreage in recent years. Moderate yields and low balances mean that it is no longer easy to get early potato growers enthusiastic about this crop. The area of early potatoes was the most last year shrunk in recent decades.
Different strategies
Position management is the other important element in the transition to the new crop. Who has sufficient coverage and who takes the risk of taking less coverage of old harvest potatoes in July/August? We see that there is a clear difference in the approach of Belgian processors versus Dutch processors.
Dutch processors are not taking any risks and want maximum coverage of their raw material needs for the last weeks of July. They do not want to be faced with any surprises if the early potatoes cannot be delivered. There are extensive contracts with growers who have good mechanical cooling, for which good compensation is paid. Contract prices will rise to over €20 before the end of July.
A number of Belgian processors are opting for a different approach and making this period flexible by focusing on the stocks of chips in cold stores and by making their maintenance depend on the availability of raw material, but especially on the price of the raw material. If this is expensive and the potatoes are difficult to obtain, they will close earlier for maintenance and fries will be delivered from the cold stores. If the potatoes are cheap, production continues for longer with relatively cheap raw materials.
Late spring but sufficiently old harvest
This year once again shows that this can lead to strange situations. The early potatoes are available later due to the cold spring, which means that old ones have to be continued for longer. But there is also a stock of fries in the cold stores. This means that chess is played on 2 boards. Belgian processors appear to have decided to continue working with old harvest potatoes and have actively entered the open market in the last 2 weeks. The price of potatoes is relatively cheap (below contract price and also below the contract price of early new potatoes) and that is why industries continue to use old harvest potatoes and postpone maintenance.
Dutch processors have a different raw material position and are well positioned. In fact, even too broad. For example, it can now happen that contract potatoes from Dutch growers from mechanical cooling are sold by Dutch processors to Belgian processors in order to keep their competitors going with cheap raw materials.
Boerenbusiness organizes a round table discussion at the beginning of September about the future of potato cultivation and the chip market. Prominent companies in the sector are joining us. Do you have questions for the experts on this subject? Send them to before August 25th d.ballast@boerenbusiness. Nl