Aviko Rixona is also increasing its contract prices for the cultivation of potatoes with a high dry matter content, better known as flake potatoes, for the 2022-2023 season. The skyrocketing energy prices are difficult for this industry, but the demand for final production is good.
Aviko Rixona increases contract prices for next season by €12 per tonne. This applies to potato varieties with a high starch content. You are then talking about potatoes with an underwater weight of 470 grams and higher. For a chipped potato this is about 380 grams. These potatoes are used to make flakes and granules, among other things.
High energy costs
Last season the company lowered contract prices by €2 per tonne, but is now forced to increase prices. After all, the cost price for the grower is also increasing. That is difficult for this 'drying industry', says Chief Agro & Supply Officer Dick Zelhorst. "A lot of energy is required to dry the potatoes. At current energy prices, this is a huge cost item. The proportions are different than for the production of French fries potatoes.
For delivery from land (week 37) the price is €109 per tonne. Anyone who delivers earlier will receive an early delivery premium. A storage premium will be paid from week 44 onwards. This amounts to a maximum of €55 per tonne for delivery in week 28. Growers can receive supplements if the proportion of reducing sugars remains below 0,18% and if the underwater weight is higher than 480 grams. The maximum underwater weight premium is €36 per tonne.
More demand for snacks
“The market for these products is positive,” says Zelhorst. "When the corona crisis started in March 2020, the demand for snacks increased almost immediately, for which Rixona products are an important raw material. People started consuming more at home and that was noticed. We saw the opposite with fries because in this segment much more is consumed outside the home. This peak in demand continued somewhat in 2021. Demand is still good now."
"Acreage growth is possible because processing is also growing," Zelhorst continues. "In recent years, cultivation has increased in the Northern Netherlands. We also see growth in the area and processing in Germany." In 2020, Aviko acquired a German potato processor in Stavenhagen. It is located in the northeast of Germany.
Cultivation benefits
Flake potatoes offer potato growers in the north and northeast of the Netherlands an alternative to traditional starch potatoes. "There are also growers in this area who grow chip potatoes – or both types – but not all soils are suitable for this," says the raw materials director.