Brace yourselves for R200 (over 10 euros) for a 10kg bag of potatoes, headlines are warning South Africans, but a look at the current average potato price of R87 (4.4 euros) per 10kg shows that would be a mountain to climb: one up which, potato traders say, buyers and consumers are highly unlikely to follow.
The severe and prolonged frost at the start of July prompted Mohammed Adam of M&R Marketing at the Cape Town fresh produce market to send out an advisory, asking for the public's understanding with stock shortages and quality issues. The cold spell, the worst Limpopo famers had seen in twenty years the note says, destroyed their potato crops. "The shortage is expected to get worse in September."
In a subsequent interview with Cape Talk radio station, Adam affirmed that potatoes would still be available over the coming weeks, and he suggested a retail price of R180 to R200, a pertinent distinction but one not generally noted.
Frost causes drop of only 3% of South Africa's annual potato supply
A decrease in potato supply is undeniable: in PotatoesSA's survey among Limpopo potato farmers after the frost, they indicated an expected 32% loss of potatoes over an affected 3,674 hectares (63 out of over hundred Limpopo potato farmers participated) and the organisation's weekly report shows a 30% drop in potato volumes coming to market.
"Potatoes SA expects at most 7.4 million 10kg bags of potatoes taken out of the system by the frost, and it sounds like a lot, but it's in fact 3% of South Africa's average total potato crop of 250 million bags," PotatoesSA's information manager FP Coetzee says. He considers the current anguish over potatoes as "over-the-top".
Weekly potato market information, 23 August 2024 (source: PotatoesSA)
Some context is necessary, Coetzee remarks. "In 2022 there was a record large crop. In 2023, the market received 11 million bags fewer than the previous year, and the price rose by 173% over longterm average to a highest price last year, over all grades and sizes, of R128 [6.5 euros] per 10kg bag. Then we had 11 million bags of potatoes fewer, this year we expect a possible reduction of 7 million bags. And at the moment potato farmers are quickly filling the gap in supply."
For Limpopo, the reduction by frost represents 13% of their average annual crop of 56 million 10kg bags of potatoes. "What happens in Limpopo between September to December plays a large role in what happens in the country. When Limpopo delivers to the markets they have a market share of around 80%."
From now until the middle of October they're definitely expecting a shortage of potatoes: specifically, a shortage of large and extra-large potatoes. Coetzee expects an adequate supply of large medium and medium potatoes.
"Limpopo potato farmers are quickly filling the gap in supply" (source: PotatoesSA)
"I just cannot see a consumer paying R200 for a bag of potatoes."
"I sit with a farmer who packed three loads of potatoes from eight hectares of potatoes," says a Gauteng potato trader who asks to remain unnamed. "That's 1,300 bags per hectare and it was overwhelmingly small potatoes."
Large potatoes are sought by restaurants and take-away outlets to make chips (French fries), and at the Johannesburg market large potatoes are currently selling for R110 (5.56 euros) per 10kg bag, while large-medium sell for R95 to R100 (5 euros) per bag.
Gauteng potato traders say they're not feeling the full impact of lower potato supply just yet, while potatoes from the western and eastern Free State are still lifted, but they're finishing up soon. Another potato trader notes that the potato price had already increased by R15 to R20 per bag over the past while.
"We won't go near R200 [10.1 euros] for a bag of potatoes. There will be huge resistance to a price like that – we're already seeing resistance at current levels of R110 for a bag of large potatoes," says a Gauteng potato trader, who says he'd be wary to create price expectations. "I just cannot see a consumer paying R200 for a bag of potatoes and I cannot see how the price could double over the coming four to six weeks."
PotatoesSA app allows public to track potato supply, pricing and sales
This trader reckons the ceiling to be R150 (7.6 euros) per bag, at which point consumers will replace potatoes with other forms of carbohydrates.
The shortage is only expected for the coming four to six weeks, whereafter a good late potato crop is expected from Limpopo where water availability prospects look better than initially thought.
Coetzee says he would like to see potato buyers and consumers educate themselves on how much potatoes are sold for at the markets, and at which prices potatoes are offered for sale to the end consumer. This is easy to do through the PotatoesSA app which shows every day from which regions potatoes are coming in, and in the afternoon at which prices they were sold across the country and how much stock is left unsold.
The PotatoesSA app can be downloaded here for Apple devices and here for Android devices.
For more information:
PotatoesSA
Tel: +27 12 349 1906
https://www.potatoes.co.za/