'Keeping table potatoes profitable, that's our job'

Potato cooperatives Agrico and Nedato announced yesterday (April 28) that they were exploring the possibilities of collaboration in the field of table potatoes. A seed potato trading house with a subsidiary in table potatoes and a cooperative active in the consumer market. That's an interesting combination.

What are the plans? And what should the collaboration look like? That asked Boerenbusiness to general manager of Agrico, Jan van Hoogen

The intention to join forces was announced yesterday. How specific are the plans?
"We are in an early phase. The table potato market is changing rapidly and to keep the cultivation interesting for our growers, we have to respond to this. Agrico and Nedato are both cooperatives with the ultimate goal of getting the most out of the cultivation for the member growers. We believe that we can better respond to this changing and shrinking market by joining forces, and we have a number of scenarios in mind that we will investigate."

Is the takeover of Agrico subsidiary Leo de Kock by Nedato the most obvious scenario?
"With the collaboration between Leo de Kock and Nedato, synergy benefits can indeed be achieved. Both companies now have their own rinsing, sorting and packaging line. In a table market that is shrinking, you therefore have to ask whether this could not be done more efficiently."

"But the collaboration between Agrico and Nedato can go further. The cultivation has become quite specialized, partly due to all the quality requirements and additional certifications. As a result, table and seed potato cultivation is increasingly moving towards each other. Both the development of new varieties (with all the associated quality and sustainability requirements) such as the cultivation of seed and consumption potatoes, you become a strong partner for large buyers, such as the supermarket chains."

In 2010, Agrico divested the potato chip business and transferred it to Aviko. So why the choice now to further explore the possibilities on the table market?
"At the time, we could no longer make a difference for our member growers in the chips market. Our volumes were too small in the total potato market. The table market is a much smaller market and I think we have a much larger share of that together."

Do you expect the competition authority to object to a collaboration?
"When investigating the possibilities for cooperation, we will also inform the Netherlands Authority for Consumers & Markets (ACM). I do not expect that many objections will arise from that quarter. If you only look in the Netherlands, then we may become too dominant, but at European level there are still plenty of other players left. Perhaps you can compare it a bit with sugar beet processors. In the Netherlands there are still two factories owned by one owner. Nevertheless, the merger between CSM and Suiker Unie was approved at the time."

Jurphaas Lugtenburg

He is a market specialist in grains and other agricultural commodities at DCA Market Intelligence. He also focuses on onions, potatoes, and roughage. Jurphaas also runs an arable farm in Voorne-Putten (South Holland).

j.lugtenburg @boerenbusiness. Nl

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