Business Markets & Pricing 2021 Potato Acreage Plans Up in the Air

2021 Potato Acreage Plans Up in the Air

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With the COVID-19 pandemic changing by the day, plans for 2021 potato acres are still up in the air as buyers are waiting to lock-in contracts, the Jan. 27 issue of North American Potato Market News (NAPM) says.

Processing contract volumes are unsettled, even though some growers in southern parts of the continent will start planting next month. Fryers are deferring final decisions on acreage for as long as possible, in hopes of gaining a better understanding of the finished-product demand outlook, the report notes.

Chip potato buyers are currently contracting 2021 production with contracts so far being flat for volume and prices. The chip industry appears to be synchronized more closely with other industry sectors than has been the case in several recent years, NAPM says.

Table potato prices are signalling growers should plant fewer potatoes this year, the report says. In Idaho, current prices are down 52 to 56 per cent from last year. Declines in other areas are less severe but still significant.

“Table potato movement from the 2020 crop is barely ahead of last year’s pace, which was the lowest on record since the current reporting system was implemented,” the report says.

Potato production costs are likely to increase this year with higher fuel, fertilizer, chemical, and labour expenses, while frozen potato product imports from European processors are at record levels.

“COVID-19 has brought a new level of uncertainty to the potato industry. Growers and marketers are struggling to manage production and financial risks.”

There are restrictions for what growers can do, crop rotation requirements prevent large  year-to-year swings in potato acreage, the report notes.