Most of the new Belgian potato crop is now out of the ground. There is general talk of good yields and fine quality, which would normally be a positive development, but in the current potato market, it also brings challenges. "Once all the potatoes are in, it will be a matter of seeing whether prices adjust and how the market evolves," says Jurgen Duthoo of Warnez.
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For the Belgian potato specialist from Tielt, around 90 per cent of the potatoes have now been harvested. "At the moment we're still having some rain, so I think it won't be long before everything is in," he continues. "It has been relatively dry in recent weeks, so there were some breaks here and there during harvesting, but I estimate that about 10 per cent still needs to be lifted." Regarding the harvest, Jurgen is moderately positive. "Overall, of course, it's variable: there are batches of excellent quality, but also some of smaller calibre," he says.
"On average, the dry matter content is somewhat high," he notes. "This is partly due to the hot, dry summer. Most of the potatoes were planted early under good conditions, with enough soil moisture. But it was hot and dry in the summer nonetheless, which affected quality in some areas. Overall, it's good, but with a few points of attention. Some varieties, for instance, tend to sprout faster or show slight visual deterioration after lifting. Such differences are often related to growing conditions. It remains to be seen exactly how things will turn out, but in terms of volume, we have more than last year."
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Setting strategy
This situation would normally lead to a positive trend, yet Jurgen remains realistic. "It also creates a lot of supply on the market. Not all lots are suitable for long-term storage, so some growers have had to sell their product directly. That obviously puts pressure on prices. Once everything is harvested, growers without contracts will need to decide on their strategy. If the price is low, some may choose to wait a few months and see how the market develops. Of course, that's in the hope of a price rise. I would do the same in their position, but it really is a matter of waiting and seeing."
So, there is still pressure on the market at the moment. "There is demand in the export market, but it's rather limited. Southern Europe, such as Spain, has a lot of stock itself, and Germany has plenty of supply from Poland. Competition is high and prices are low everywhere. Logistics also play a role: The total cost price for the customer ultimately determines their choice. Some shipments are going out, but that's partly because the low prices are temporarily generating extra demand. Once everything is in, the market will probably correct itself. At least, that's what we hope."
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Price differences
"Moreover, at the moment we're hearing very different prices, which causes confusion, especially in exports," Jurgen explains. "A packer has fixed costs, but a grower with a big-bag machine can deliver directly at a lower price. This creates large price differences, which can be difficult for customers to understand. We need to explain where those differences come from."
"For example, there are currently large price gaps between standard unwashed potatoes and the high-quality washable ones. Some customers, for example, from Eastern Europe, specifically need washable potatoes for retail and are willing to pay up to 20 cents per kilo. Smaller buyers working with unwashed product are more likely to pay around 10 cents. That difference comes down to quality, visual appeal, and shelf life. It's also a way to stand out in this market. Volumes in the niche of high-quality exports are smaller, but prices are naturally higher there. That's the current state of the market."
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Yet Warnez also still sees growth potential in convenience. "Such as food boxes or fresh food packages for retail, for example. We remain fully committed to that as well. It's still growing steadily and expanding into new markets. Test shipments to southern Europe are already underway. If the concept catches on there, it could mean a nice increase in volumes."
For more information:
Jurgen Duthoo
Warnez
Mariënhovestraat 6
8700 Tielt, Belgium
[email protected]
www.warnezpotatoes.be
