News Potato analysis 2018
'You have to keep your leg up and say no'
Jan Rademaker has been an arable farmer in the Canadian province of New Brunswick for almost 30 years. It is an ideal potato area; it's not for nothing that the McCain brothers started making French fries here in 1956.
Jan Rademaker comes from an arable farm in Biddinghuizen. He did not want to take over a company and after a trip around the world he ended up in Canada. "It is laid down by law here that the supply contracts must be discussed between grower and buyer, while in most countries you can only sign strangulation contracts," he says. "I am also a member of the local growers' association, of which 24 years as a board member."
Since the 70s there has been a law in Canada that guarantees a good price. "McCain is a family business, but hired CEOs have a purely profit motive. They try to lower prices. As a growers' association we fight against this and we do that successfully. Last year there was little opposition and the price has increased by 5%. So you have to learn to hold your ground and say no."
Judge as a remedy
Rademaker says that the association puts together a sort of negotiating team when the negotiations take place. "They then negotiate with McCain. During the members' meeting, the contract price is voted on. If you do not reach an agreement, the case will go to court. A mediator can also be used to make an independent judgment, although this has never happened before. "We have always reached an agreement until now. You have to be realistic and remain interesting for the factory, but not at rock bottom prices. You only have yourself with that."
- Jan Rademaker
The province has more than 20.000 hectares of potatoes, half of which goes to McCain. There are still 3 factories in the surrounding provinces. The majority of McCain's production is destined for McDonald's. In addition, both the Canadian and American east coasts are important sales areas. "The growers' association consists of about 90 growers, with an average of 112 hectares of potatoes per company," says Rademaker. "However, there is a considerable spread between the growers; for example, the largest grower has more than 1.600 hectares of potatoes. These are all potatoes of the Russet Burbank variety."
Investing in the soil
In Canada, prices are settled in dollars per barrel. "That is this year converted to €22 per 100 kilos. In addition, approximately 35% of the tubers must be heavier than 283 grams and a maximum of 5% may be smaller than 50 millimeters. Without irrigation, the hectare yield is around 40 to 45 tons (net). The lack of undersize will cost you kilos."
Rademaker does not want to expand in acreage. "A lot of the land has been sown with grass clover and a part has also been sown with hemp for seed cultivation for oil extraction. I do all this for good soil, because that is my savings bank. The soil can therefore withstand extremes better and the crops are more vigorous. Maybe one day my son will take over the company, so at least he'll have a good base to start with."
Receive the magazine in your letterbox
This abbreviated article is part of the potato analysis of 2018. The subscribers of Arable farming Pro en Potato market have recently received it. Would you also like to receive this magazine? then click here to become a subscriber and receive the magazine sent to you.
With a subscription you get access to all private articles, data and market information on Boerenbusiness† As a subscriber you also get access to the National Economic Agricultural Congress and other seminars and workshops. Curious about all the benefits? View our offer in the webshop.
Niels van der Boom
© DCA Market Intelligence. This market information is subject to copyright. It is not permitted to reproduce, distribute, disseminate or make the content available to third parties for compensation, in any form, without the express written permission of DCA Market Intelligence.