The potato industry in New Zealand has weathered the corona year well. The 2020 annual report shows that the sector's turnover grew and that the French fries import even shrank slightly. The discussion about alleged chips dumping from the Netherlands and Belgium thus seems to have been finally nipped in the bud.
Shortly after the outbreak of the global corona crisis, trade association Potatoes New Zealand (PNZ) sounded the alarm. Cheap fries from Europe, supplied by the Netherlands and Belgium, would disrupt the internal market and cause price drops of up to 38%. After all, in Europe the lockdowns led to enormous potato surpluses and the processing industry was eagerly looking for alternative sales markets.
No import restrictions
Growers and processors in New Zealand urged the government to impose import restrictions, but none were forthcoming. The Ministry of Business, Innovation and Employment (MBIE) investigated the situation and presented its findings last spring conclusion: yes, there is dumping, but it does not pose a threat to the domestic market. PNZ now seems to have drawn that conclusion itself, although it uses different words. “Despite the threat to our processing industry from cheap European imports, we have continued to produce the best New Zealand potato products. The 2020 data presented in our annual report shows continued value growth,” PNZ said. The value of the New Zealand potato industry reached $2020 billion in 1,16. An increase of more than 6% compared to 2019 ($1,09 billion).
Higher turnover of the French fries industry
The chip factories also contributed to this growth. The manufacturing industry generated sales of nearly $2020 million in 616. That is slightly more than the $610 million in 2019. The processed volume shrank significantly from 175.00 tons in 2019 to 158.000 tons a year later. Of these, 18.158 tons of fries were imported from abroad. While in 2019 the imported volume still amounted to 18.606 tons of fries. Imports were therefore almost 3% lower.
According to PNZ, the results are mainly due to a strong domestic market. Exports suffered major setbacks due to the corona pandemic. This is reflected in the annual figures. New Zealand chip exports shrank 23% last year to a value of $78 million. That gap was covered by fries sales to retail, which rose more than 24% and amounted to $107 million. French fries sales via food service also increased slightly (+4%) to $429 million.
Ambition 2025 has already been achieved
With current figures, the New Zealand potato industry is well above its target. In 2013, an ambition was set for 50% market growth by 2025. The sector is already growing at 58%. Exports, on the other hand, are growing less rapidly. Between 2013 and 2019, exports increased in value by more than 16%, while the goal is to double by 2025. The corona year, in which export figures deviate considerably, does not provide a realistic picture of further developments.