Last season's favorable yields led to lower potato prices compared to prior years, presenting challenges for producers. Luis Miquel, general manager of the Papa Chile Consortium, explained that high yields resulted in surpluses, creating an oversupply that pressured prices downward. He described the situation: "When we are doing well in terms of production and obtaining good returns, there is a higher production that we are unable to absorb, which leads to a drop in prices."
For the upcoming season, Miquel forecasted a slight production increase, but not substantial enough to elevate prices to previous levels, expecting low prices to persist. He noted that planting areas would be influenced by weather conditions and financial resources, warning that many producers might face shortfalls preventing further planting, impacting future potato availability due to reduced planted areas.
In Biobío, early-potato availability might be delayed by climate, though Miquel remarked that "the area is predominantly a potato region. From the Araucanía region southward, there is an ideal climate, with rainfall and abundant groundwater."
Current prices range from $3,000 to $4,000 for a 25-kilo bag. Despite this, Miquel asserted that Chile remains "a country that, despite so much availability and excellent quality, prepares it very traditionally, without a specialized kitchen." He suggested that industrial processing could enhance value from the crop, noting the reliance on imports for processed forms like frozen and mashed potatoes, a sector where "we are not participating," due to a lack of processing facilities.
Miquel emphasized the need for processing investments, describing them as "very large" with few existing incentives to develop domestic plants. He compared financing challenges, where establishing a potato processing operation demands substantial collateral as banks perceive agro-industrial ventures as risky and levy higher interest rates. In contrast, Miquel noted easier financial dynamics in real estate, where investment conditions are more favorable. He called for state policy intervention via bodies like Corfo to support industrialization efforts to bridge this gap.
Source: Argenpapa