Since the start of the millennium, potatoes have accounted for approximately 45% of the total vegetable crops produced in South Africa, contributing around R8.5 billion (€4.3 bln) to the economy. These numbers, however, are under threat due to a surplus of frozen and processed potato products in Europe, as a result of a decreased demand brought on by the COVID-19 pandemic worldwide. This has significantly depressed prices.
As South Africa is a key destination for processed potato product exports from the EU -with its history of dumping- this is set to have a negative impact on the country’s agricultural sector and surrounding communities.
André Jooste, CEO of Potato South Africa (PSA), says that the local potato industry has already suffered significantly from a decrease in demand as a result of COVID-19 related regulations, such as the closure of restaurants and fast food outlets, restricted trade and movement of informal traders. “The result was a significant drop in prices far below break-even prices for producers and a build-up of stock levels in the processing sector. A further blow due to low priced imports from other countries could be catastrophic.”
The Potato and Vegetable Processors Forum (PVPF), which includes PSA, McCain Foods South Africa, Natures Garden and Lamberts Bay Foods, have been lobbying the Government to institute a temporary prohibition on imports of frozen potato chips from the European Union as a consequence of market conditions impacted by COVID-19. This is to protect the sustainability of the potato industry, inclusive of employment by local potato growers and processors in the country. Potato growers and processors have significant economic multipliers for rural towns and cities.