The average market price of chips potatoes in Germany remains far below that of Belgium and France in particular. This is clearly reflected in the cash settlement (CS) for week 5. The contribution of the Netherlands, but especially Germany, lags considerably behind Belgium and France.
The cash settlement this week amounts to €29,40. That is €1,70 higher than last week. While the average contribution from Belgium and France was €30,90, the German contribution is more than €4 or 15% lower at €26,84. Moreover, the Dutch contribution to the CS at €28,83 is also a lot lower than that in Belgium and France. In any case, the €30 level remains a 'thick ceiling', despite the fact that, given the contract prices for the 2023 harvest, we think we live in a different world than the previous harvest years.
Difference in yield
The significant difference between, in particular, the German input and to a lesser extent that from the Netherlands for the CS versus that from Belgium and France, clearly indicates the 'gap' (read: shortage) of raw materials that exists - due to a disappointing harvest - in those regions. In Germany and large parts of the cultivation areas of the Netherlands, there has been no disappointing potato harvest, which means that market prices have been experienced as more than good in recent months. It is now clear that there is a strong demand for potatoes from Belgium and France. The price difference can be easily explained by calculating the transport costs. Loading potatoes in the north of Germany is apparently still a bridge too far for Belgian processors, for example.
By the way, relatively little is known about the German contract prices for 2023. Insiders do indicate that German processors do not fully follow the contract price 'violence' that occurs in the other EU-4 countries. A German processor is said to have dipped a toe in the water at the end of January by starting with an ex-land contract for potatoes suitable for fries at €15,50 per 100 kilos, delivered to the factory. The toe was reportedly quickly retracted and the processor went back to the drawing board. The German potato growers naturally know which way the wind is blowing.