"This season, it's going to be immensely challenging to get the required volumes. The potatoes' quality could also become an issue. But, things could still turn around if we have two more months of nice growing weather," says Ramon Wagenaar of Wagenaar Aardappelverwerking, detailing the effects of the wet growing conditions in early July. This Dutch potato processing company exports potatoes mainly to the Caribbean and Eastern Europe.
He thinks Wagenaar's own yields will be about 30% lower than usual. They had to replant some plots because the tubers rotted, delaying harvesting, which is unlikely to be completed before mid-September.
Oversized seed potatoes
Due to that shortage, the processor, who used to often trade in outsized seed potatoes, is now forced to use its own. So, the company has had to change strategy and enter into contracts with ware potato growers. Reduced volumes due to wet growing conditions mean the company is also considering imports from countries like Egypt and Israel, where geopolitical conditions have led to lower supplies, too.
Wagenaar Aardappelverwerking focuses its exports on Eastern Europe and the Caribbean region especially. Ramon sees a decline in fresh potato demand from the Caribbean in favor of French fries, while Eastern Europe is eager for potatoes from Western Europe. Nevertheless, limited columns put pressure on prices, thus halting the export market. Potato prices are high, which complicates trade because potatoes must remain affordable for consumers in export markets.
Buyers monitor prices
Buyers keep a close eye on those prices. "Last year, prices were often firm, and steep grower prices are already being paid. Traders can't add much to that because the potatoes must also be transported and remain affordable for people once they get to their destination." Ramon knows buyers monitor prices.
"The Netherlands grows plenty of potatoes, and much is exported, but exports decline sharply if we become too expensive. Then potatoes can come from other countries," he says. The potato trader mentions the negative impact the availability of cheaper Canadian fresh potatoes had on Dutch sales to the Caribbean last year.
Ramon adds that growers' limited sales spread does not benefit price formations. He explains that there is much procrastination in product sales and advocates more spreading to prevent a trade stall. "If growers wait too long to sell their potatoes, traders have no supply, and customers start looking elsewhere. And once most of the market switches to importing potatoes from other origins, we're really too late," Ramon concludes.
Wagenaar aardappelverwerking B.V.
Woudmeerweg 30
1746 CD Dirkshorn
Noord-Holland
T: 0226 316 946 – Dirk-Jan Strijbis
T: 06 5133 1314 – Jack Wagenaar
[email protected]
[email protected]
www.wagenaaraardappelverwerking.nl