The French fry potato pools face a huge challenge this season. Those without fixed agreements with buyers are scrambling to sell potatoes. Moreover, there have been few opportunities to hedge on the futures market. Yet, not everyone is pessimistic. It can also be seen as an opportunity.
Regardless of what the season brought, potato pools have been under pressure for some time due to the malfunctioning potato futures market. By hedging with this instrument, pools can often achieve results that are higher than those of the free, physical potato market.
Emergency clock
More than a year ago, Aviko's Potato Growers Committee (ATC) already announced the emergency bell Regarding the futures market and the far-reaching consequences that the lack of properly functioning futures can have on the pool result. With an open position of just over 300 contracts (7.500 tons) and hardly any contracts traded since October 1st, market forces have only become more depressed. This is partly due to the fact that more and more potato processors are avoiding the futures market, even though they do offer click contracts.
Anyone who rereads the statements of André Broeze and Hilchard Waalkens, chairman and member of the Aviko ATC, respectively, will see the painful truth with hindsight. "The sky's the limit. We've had good years, but there will definitely be other years," Waalkens said in November. And Broeze this summer: "During the pool meeting, I jokingly said, are you satisfied with half the current contract price?" Ultimately, it was much less than that, at only €25,07 per tonne compared to €215,89 per tonne a year earlier. A price drop of 88%.
The Aviko pool is by far the largest in the Netherlands, but certainly not the only one. Others include Q-Potato, Nedato, Schaap Holland, and APF-Eriva. The volume grown in these pools is steadily shrinking, especially when fixed-price contracts rose significantly in price. Just over ten years ago, there were only about ten different pools operating in the Netherlands. That number has now halved.
No free market
While the lack of a functioning futures market may be hampering the pools, the physical market offers little relief. This, in turn, has repercussions for the futures market. While there's still some market for premium varieties like Innovator and Agria, interest in bulk varieties is currently zero.
Few words
When you are being shaved you must sit still, most pool managers think so. They are therefore not very eager to elaborate on the current state of affairs compared to Boerenbusiness"We're not making any substantive statements about the pool; that's something we discuss with our growers," says Nicole van Doorn of Nedato. Q-Potato owner Dirk van de Water summarizes it briefly: "It doesn't matter whether you're in a pool or have a contract, producers are cutting corners right now." It's important to recognize market opportunities and limit the damage. The more highly regarded varieties, such as Innovator and Agria, are finding buyers. Bulk varieties, particularly Fontane, are being phased out quickly.
What the combination of a dysfunctional futures market, lack of demand, lower contract prices, and declining volumes will mean for the pools is anyone's guess. Pool operators are working on it, but making statements now is risky. "The market has plummeted since February, and that negative segment carried over into the new season. This downward trend hasn't bottomed out yet," several pool operators believe. They hope for some relief in the second half of spring, provided that French fry sales don't decline further. The development of the planting season also plays a significant role.
Meanwhile, pooled growers have little choice but to wait. Most companies use various marketing methods, and switching to contracts now is impossible. Potato processors will be contracting fewer potatoes for 2025/26, so there's no room for more volume. Completely free cultivation is the alternative, but also the riskiest. Moreover, it's still too early to see a pattern of potato growers considering switching. They're looking for certainty, which is currently hard to come by.
Increasing free market
Initial indications are that most potato processors will be contracting for fewer tons at a fixed price next season. The likelihood that arable farmers will grow fewer potatoes is slim, given the lack of alternatives. This will cause the volume of free-range potatoes to increase significantly in 2026/27. Variety optimists see this as an opportunity that could also revitalize the futures market. More risks are emerging in the potato market, and these must be hedged. This applies to both growers and buyers. This could give the next market season a unique dynamic.