In many growing areas it is necessary to wait for rain to be able to harvest the potatoes in a somewhat good way. This is a requirement, especially for storage potatoes, if the product, whose underwater weight is already extremely high in many cases, is to be able to get behind the shelves.
For potatoes delivered from the field, the problems are fewer as long as they are processed immediately. In addition to the regular and scheduled supply from the field, there are also growers who, based on the current various stock exchange quotations (approximately €24,50), want to supply potatoes that would normally go into storage. However, customers are not interested in additional unplanned supply. The question is therefore whether the various quotations, such as today (Friday September 2) Belgapom (€25 mood stable) and REKA (up to €26 for Zorba), do justice to the current free potato market, which is forecast with some rain in the forecast according to insiders. will rather come under pressure.
The closing futures market position of the April 2023 contract amounted to €27,80 (high €28,10) with a limited turnover of 42 contracts. The April 2023 quotation is at around the €28 level compared to the various quotations (Belgapom, REKA and PotatoNL) from last week, on the low side. Just consider whether to deliver potatoes in the coming weeks based on the average quotations (approximately €24,50) or trade on week 17 for €27,50 (average futures market quotation). Then the choice seems to be quickly made given all the uncertainty in the world, especially when it comes to energy and therefore storage costs, among other things. The fact, however, seems to be that the physical market (at least the quotations) are too high when it comes to free potatoes, which means that a futures market price of €28 seems more appropriate.
Uncertain world
The uncertainty that prevails worldwide, mainly caused by the war in Ukraine, is leaving its mark on the potato market. Buyers do not want to burn their fingers by securing many potatoes at high price levels for the first half of 2023. A lot of raw materials have already been secured through price agreements and contracts. During the season, we will examine how the situation on the potato market will develop.
First let's get the main harvest behind the shelves, which will give a clear picture of the average tonnes per hectare that have now been harvested in the EU-4 countries. Then see if and when additional demand will come from, for example, Switzerland and/or from Southern and Eastern Europe. But the ovens can also continue to run at full speed, given the problems in Germany in particular with regard to the gas supply. In short: there is enough uncertainty that, as mentioned, no one wants to burn their hands, as evidenced by the tenders for Fontane, for example, which are being put out on the basis of € 27,25 to € 27,50 for delivery week 17 2023. A poor offer, especially considering the current price that could be made in the current daily market.