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Inside Potato

French fries crisis does not cause problems for seed potato trade

11 April 2020 - Thomas Doornbos - 3 comments

The contracts for the upcoming season with the chip potato growers are currently being shortened. The acreage intended for the off-land segment, in particular, would be reduced for the upcoming harvest. What does this mean for the seed potatoes intended for this decline in acreage, and does the seed potato grower also surrender acreage for the coming season?

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Gerard Backx, CEO of HZPC, indicates that there is a lot of consultation between all parties in the potato chain. To limit the drop in demand for fries, especially in the catering industry, the chip industry is aiming for a lower acreage of contract potatoes for the 2020 harvest. The big question now is: will fewer potatoes actually be grown this season.

Possible shrinkage cannot be seen again
HZPC does not yet see a possible decline in seed potato purchases, reports Backx. "The real potato companies may downsize in contract cultivation, but then plant the potatoes for free cultivation. Other arable farms often have a lack of alternative cultivation. Consider, for example, spring wheat, which is not financially attractive for these companies. "As a result, we have not yet seen a significantly relevant decline in seed potatoes and therefore have not suffered any major damage at HZPC."

Wieger van der Werff, commercial manager of Agrico, also believes that the effects of a possible contraction on his company are not too bad. The contracts are being recalled, but it is not yet on such a scale that it will cause problems for Agrico. "We have delivered approximately 3 tons of seed potatoes in the last 100.000 weeks, which is a good result."

No export problems
The chip industry is mainly trying to reduce the area of ​​off-field potatoes, because there is a risk of overlap with chip potatoes from the old 2019 harvest. According to Van der Werff, the seed potatoes intended for off-field deliveries have long since been delivered to the relevant companies or growers. "This is therefore more of a matter for the grower and industry and no longer within the scope of Agrico." The damage in the chip industry is also mainly reflected in the fast-food potato varieties, says Van der Werff. "At Agrico we are not the largest in this regard and therefore do not experience or expect any major damage."

Both trading houses also experience no export problems, they indicate. No country is blocking the extradition of seed potatoes as a result of the coronavirus, which means that all transports can continue. The transport movements of seed potatoes are greatest in the months of March and April, but no orders have been canceled during this period. 

However, transport and delivery are made more difficult by the corona measures in various countries. It has also been clarified to governments and politicians in the various export destinations that seed potatoes must be seen as an important starting material for the food supply and that transport must therefore continue. 

Don't grow less seed potatoes
The seed potato growers will not reduce the area for this growing season, according to Van der Werff. HZPC also does not advise growers to grow less seed potatoes, says Gerard Backx. "The growers have already completed the construction plans for the coming season. We will not then advise to grow less seed potatoes. We do warn the growers that the prices of the excess seed potatoes will not turn out well."

HPZC therefore advises growers to pay extra attention to 'keeping the size' of the seed potatoes this year, Backx indicates. Van der Werff notes that the prices of the oversize are very poor. "At the beginning of January, prices were around €10 to €13, but this is no longer the case."

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