Simplot’s planned plant expansion in Portage la Prairie, Man., is great news for Manitoba’s processing potato growers.
The market for Manitoba potatoes will soon be significantly bigger, thanks to J.R. Simplot’s planned plant expansion in Portage la Prairie, Man. Simplot announced earlier this month it will spend $40 million on the project which will more than double the capacity of the french fry plant.
“It will have a big impact. First of all, it means more market for the product,” says Kevin MacIsaac, general manager of the United Potato Growers of Canada (UPGC). “It’s fantastic news for Manitoba growers.”
MacIsaac adds any time there’s an expansion in one potato sector, it typically means there are fewer surplus potatoes in that category that go into other sectors, which affects pricing. “When there’s no surplus, there are fewer opportunities to produce open potatoes and this makes the buying process much more even keeled.”
Storage Holdings Picture
Figures from Agriculture and Agri-Food Canada (AAFC) show Canada’s potato storage holdings as of Feb. 1 were up from a year previously, but according to UPGC, the holdings are actually in line with where they should be.
MacIsaac says the AAFC figures don’t tell the true story because of how New Brunswick’s fresh holdings were reported. That province included whole potatoes intended for processing into fresh cut fries in this category which could be viewed as artificially inflating the overall number of fresh or tablestock potatoes in storage in Canada.
“There isn’t a surplus of potatoes on the fresh side,” he says. “Based on the pricing that we see in most areas, we are matched very well in terms of the fresh sector.”
It’s even likely, MacIsaac adds, that a number of areas like P.E.I. and Quebec will run out sooner in their packaging operations compared to some other years.
MacIsaac says AAFC storage holdings figures appear to be fairly accurate for the processing sector. “Processing is up, and it needs to be up because of the plant expansions that have occurred. We need to have extra potatoes in that sector to meet that expansion need.”
For seed potato storage holdings, it’s a different story. “There’s a lot less seed then we’ve seen in other years,” he notes. “This year, we are down substantially from where we were a year ago in terms of our seed holdings.”
MacIsaac, however, isn’t concerned about a potential seed potato shortage and says the holdings are in line with what will be required for planting. “We will not be short. We just have less in the category then we’ve had in some other years.”
The quality of potatoes still in storage is generally holding up very well. “I think every year we tend to see better and better quality. Growers are constantly improving their storage skills, so I don’t hear of many issues with the crop that’s coming out of storage,” he says.
MacIsaac points out potatoes have been moving from storages into the marketplace at a good clip throughout most of the winter. “Overall, demand has been good [and] most areas would report they’re on schedule or slightly ahead of schedule.”
In addition, the pricing picture for potatoes as spring approaches is excellent. “Last year was a good year for pricing and we are very close to last year and slightly above that in some areas, so that’s good,” he adds. “We’re pleased with the way it is, and again, it’s related to how closely I think the supply is matching the requirements of the demand in the market.”
U.S. Storage Numbers
Figures released by the United States Department of Agriculture (USDA) this month showed storage holdings in the U.S. were down slightly from the same time the previous year.
The 13 major potato states held 203.1 million hundredweight of potatoes in storage on Feb. 1, 2018, according to the USDA figures. Potato storage holdings on Feb. 1, 2017 totalled just under 202.6 million hundredweight.