Perfect storm hangs over the potato market

The big question is: who catches the falling knife? That all the negative ingredients in the market come together like this, you don't often see. The last time was during the outbreak of corona when the market also completely imploded.

Spring
Where the past two years the spring provided a boost for the potato price and the spring was extremely late and wet, the opposite seems to be the case for the 2025 harvest. The winter was relatively dry, with even some light night frost and now the spring weather is early and beautiful. According to the weather reports, this could continue for a while. A good structure with high temperatures will ensure a flying start in the early growing areas.

Early growing areas
This week, the areas in Bordeaux will be as good as planted. In the Palatinate, the work started this week and next week they expect to be able to get started in the state of Rhineland. It has been a long time since they were able to start so early in the season under such beautiful conditions. If the weather remains good, the main harvest will eventually go into the ground within three weeks. Of course, this does not say anything about the final yield, because anything can still happen (frost, drought, etc.).

Export
The export of potatoes has also come to a standstill in recent weeks. This was going relatively well, with good demand from various parts of the world, but that does not seem to be the case anymore. Especially the sales to Africa have come to a standstill due to a large supply from Egypt. Insiders whisper that these are potatoes that were meant for the European market, but that these have been cancelled, so that they are now offered on the African continent for any price.

Coverage of processors
The main demand for potatoes in Europe must ultimately come from the processors. This was seasonal in the off-land period due to the overcovering of a considerable number of processors. This created a bulldozer effect on the market and even lowering the price could not create more demand. The price fell well below cost price and is equal to the current price level of Belgapom.

Most processors also have/had good coverage for the storage season. It was assumed that the sales of fries would be at least as high as in previous years and would even grow slightly. With a slight growth, sufficient additional purchases would have to be made at the daily price. Just before Christmas, there was extra demand for certain specific potato varieties (Innovator) from a limited number of processors. Coverage was sufficient, but not for specific varieties. This run on fast food varieties sucked the rest of the potato market along.

Belgian processors remained cautious with the price increase (resulting in a lot of grumbling among Belgian growers). However, Belgian processors had no need for fast food varieties. Their sales were mainly in the Fontane-like varieties and there was (is) sufficient supply of these due to, among other things, quality problems. When the coverage of the fast food varieties was achieved at the beginning of February, the demand as a whole also disappeared from the market. No demand for potatoes and a lagging sales of the end product (and thus the growth of the stock of fries) caused a complete drop in demand. Result: sharply falling prices.

Opportunities
Now that the market has entered a kind of perfect storm (early spring, large coverage, faltering sales and moderate exports), the question is what the market will do next. Much will depend on the recovery of the French fry sales. Geopolitical opportunities and threats also play a role in this. If Trump unleashes a trade war, this could also offer opportunities for the sale of French fries from Europe to other parts of the world. The final stock of potatoes until the end of the season will also be decisive. If a lot is spilled or rejected at these low (below cost price) prices with a possible moderate growing season in the months of May and June, opportunities can always arise again at the end. However, in the short term, stabilization is the best thing the market can do.