The first redundancies have occurred at potato processor Mydibel in Belgium, De Standaard reports. This concerns a small group of employees, but it is indicative of the financially difficult situation in which French fries producers find themselves.
It is obvious that the corona crisis is dire for the Belgian potato sector. The country is the largest exporter of potato products. For a producer like Mydibel, only 3% of production is intended for the internal market. In addition, the company normally supplies 70% to the food service channel and sales have stagnated considerably due to the closure of the catering industry and cancellation of events. According to Marc Van Herreweghe, CEO of the company, the factory is operating at half capacity.
As a result, Mydibel has dismissed 20 employees. Not many out of a total of 700 employees, but indicative of the financially difficult times the company is going through. This also has to do with the new factory being built in Mouscron, an investment of €90 million. The factory will produce fresh pre-fried fries and should be operational in September.
More companies in need of money
Other large potato processors in Belgium have also recently invested heavily in capacity. According to Belgapom, a total of €4 billion in the past 1,6 years. The Belgian organization for the potato trade and processing therefore fears that more companies will find themselves in need of money if the market situation does not improve in May.
Belgian potato processors still have a total of more than 1 million tons of contract potatoes to be collected from growers. In addition, there is a large stock of free potatoes. Trade organization Belpotato.be expects that Belgian growers will be left with a total of 750.000 tons of potatoes, a loss of €125 million.
“An alternative destination must be found for the potatoes that cannot be processed,” says Romain Cools of Belgapom. “The 750.000 tons mainly concerns free potatoes that have no destination. Factories simply want to purchase and process the contracted potatoes. If not otherwise possible, another solution will be sought.”
Three-step plan
When it comes to finding alternative destinations, Belgapom uses the step-by-step plan: food, feed and green energy. The starting point is to prevent food waste as much as possible. Reason to set up a campaign together with the Flemish government potato food banks to provide. Cools: “The Walloon government is also currently investigating the possibility of setting up such a project. With this campaign, the less fortunate in our society can also use tasty and healthy potatoes.”
Furthermore, according to Cools, there is also a massive focus on using potatoes as animal feed. “Fortunately, our country has many mixed companies, so this can be used to maximum effect.” For the remaining part of the potato surplus, the Flemish government is consulting with the biogas installations sector to ensure processing into green energy.
Various promotional campaigns
In the meantime, a campaign is being developed to promote the use of frozen potatoes. “That helps to free up capacity in our freezers and to process as many potatoes as possible,” says Cools. Various parties, such as Belpotato.be and the General Farmers' Syndicate (ABS), are also stepping into the breach to promote home-grown potatoes and potato products.
Supermarkets are encouraged to give these products prominent places on store shelves and consumers are encouraged to buy these potatoes. This will compete with early potatoes from abroad that can be offered at low prices.
The Belgian potato sector has asked the government for support, but unlike the Netherlands, it has not yet received a commitment.