Consumers in Australia have to dig deep into their pockets for a bag of chips or a portion of fries. A soaking wet growing season has decimated the potato crop along the East Coast. Exporters of frozen potato products from the small Netherlands benefit from this. David is thus supplying Goliath to speak in Biblical terms.
Heavy rainfall in Tasmania - a key potato growing area for Australia - and New South Wales have had a major impact on the harvest. Hardly affected growers have sometimes seen their entire harvest lost due to heavy rainfall. Hail storms in the state of Victoria also have a negative impact.
Potato growing in Australia
Potatoes are the most important vegetable crop in Australia. Its production has increased in recent decades, with the arrival of more manufacturing industries, and has stabilized in recent years. The country harvests about 1,45 million tons of potatoes, 60% of which are processed into fries and chips. The majority of potatoes, about 40%, are grown in the state of South Australia and a quarter in Tasmania.
Potato cultivation is a bit different than we are used to in Europe. The seasons sometimes overlap due to different climates in the states. In South Australia, the harvest starts in February and can be delivered to the factories from the field for six months. The other half of the year the potatoes come out of storage.
Production gap
The large potato shortage started when the various states were at the end of the storage season, approximately from October to November. Early production in New South Wales and Victoria has not been able to fill that production gap, leaving importers to do so. The Netherlands emerges as the 'winner'. In any case, our country is Australia's main supplier of frozen fries.
French fries imports in the country have recovered considerably since the corona pandemic. According to figures from trade organization Augveg, 2021 tons of product were imported in the 2022-118.400 season (which runs until July). That's a plus of 15% compared to the season before. The Netherlands supplied the most fries with more than 36.000 tons, followed by Belgium with 28.000 tons. New Zealand – which has the best geographical maps – is good for 30.000 tons. The US is seeing its position erode, mainly because the country does not have sufficient product and the price is simply too high.
More recent figures, up to November, show that the Netherlands also exported an increasing volume to Australia at the end of last year, when the potato shortage continued to increase. Volume increased by half in October. Even though the price of fries from the Netherlands has increased by 5%, the demand remains there. Belgian fries were sold for a slightly lower amount.
French fries potatoes
For the processing industry, growers expect the problems to resolve quickly, because the harvesting of chip potatoes will start this month. This is different for potato chips and table potatoes, because the harvest starts later. New Zealand has difficulty helping the Australians with this. The country itself has had a wet growing season, especially on the North Island, which has resulted in a smaller potato harvest.