It is quiet, eerily quiet around the potato quotations. The market has fallen a long way from historically high prices. If this were to happen in onions, traders, speculators and growers would fight each other out, so to speak. But hardly any attention is paid to the potatoes - which for many arable farmers is the mainstay of the company's business. While remarkable things are also happening in the potato market.
Criticism of a listing, whether justified or not, is timeless. Sellers often find a price too low and buyers too high. However, there is another problem with potato quotations. The big question is: on what information are the potato quotations based? And by extension: is that still in accordance with the listing protocol?
On paper, the PotatoNL should paint a more balanced picture of the market compared to, for example, the Belgapom. In PotatoNL, in addition to processors (two members on behalf of VAVI) and traders (two members on behalf of NAO), growers (two members on behalf of ZLTO and LNCN each) are also at the table. In addition, the Dutch quotation has no observations or indicative prices, but only quotations that must be established in accordance with the regulations and protocol. The discussions in the committee are of course confidential and shared information may not be made public. Only logical since confidential information is being worked with. It is just difficult for an outsider to verify the quotation.
Public transaction list
However, you can generally find out which transactions underlie the quotations for potatoes suitable for fries. It has been established with four of the five members of the VAVI that they submit all their (free) transactions to the BO Akkerbouw, which then anonymizes them and sends them to the listing committee and publishes them on the PAT overview. The PAT list is public and can be consulted by anyone interested. The listing protocol goes even further, because it states: "The listing agents from the trade, processing industry and cultivation provide daily copies of all purchase agreements that meet the conditions."
The PotatoNL has been commenting on very few transactions for the Cat quotations for two weeks now. 1 (Suitable for fries, fast food fries and regular fries). Cat. 2 (Suitable for fries and fresh fries) is not noted. We can substantiate this from the PAT list. Two transactions in week 39 (160 tons of Fontane at €11 and 195 tons of Zorba at €13) and two transactions in week 40 (310 tons of Zorba at €13 and 325 tons of Fontane at €11) mean that we can rightly find few transactions (from the processing industry). There is another transaction, but that concerns delivery in May and therefore falls outside the delivery period on which the quotation may be based. We can therefore conclude that the processing industry is hardly in the market for free potatoes.
If we place the PAT list next to the PotatoNL and we also include the listing protocol, things start to get a bit complicated. Suitable for fries this week is €10 to €13. Apparently there was a trader who bought free potatoes from a grower for €10. If it were one of the four Dutch processors, it should have been on the PAT list.
According to protocol?
Opinions differ as to whether there are growers who actually sell free potatoes for €10, €11 or €13. That raises a second question. Are the transactions entered on the PAT list free or co-delivery potatoes? If the potatoes are free, they must be included in the quotation. If it concerns potatoes that are included in the quotation and they are included in the quotation, the quotation committee is violating its own protocol. It states: "The purchase agreements contain prices that are determined through consultation on the day of conclusion (free potatoes)".
If we delve a little deeper into the matter, there are two more notable transactions on the PAT list on October 3. Not in terms of price, but in terms of tons, namely 50 and 85 tons. Strictly speaking, these may not be included in next week's quotation. The protocol states: "The purchase agreements entered must have a minimum quantity of 100 tons."
Advocates
Growers who have a (large) part of their potatoes under contract may now think: everything will be fine with those prices. But don't forget that the potatoes supplied are often paid for on the basis of the PotatoNL. You could call it worrying that few or no questions at all are asked by growers or grower organizations about the listing. Initiatives by growers that help improve the position of the farmer in the chain or a stand organization to which all arable farmers are obliged to contribute in order to promote the interests of the sector, seem to consciously or unconsciously leave the low-hanging fruit hanging. Defacto writes the potato grower a blank check to the chip industry. And the processor only says; thank you, please. This goes directly against the principle of the free market that a healthy business should cause some pain for both buyer and seller.