Business Markets & Pricing U.S. Potato Acres Down 4.9 Per Cent in Pandemic Contract Cuts

U.S. Potato Acres Down 4.9 Per Cent in Pandemic Contract Cuts

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United States potato growers planted 47,300 fewer acres to potatoes this year than they did during 2019, with the biggest cuts coming in Washington, Idaho, and North Dakota, who accounted for over 80 per cent of the decline, the July 1 issue of North American Potato Market News (NAPM) says.

The U.S. Department of Agriculture’s potato acreage report was released on June 30, however NAPM believes the USDA has overestimated acreage for Oregon, Wisconsin and Nebraska, while Texas has been understated.

Based on trend yields and average abandonment would result in a 415.1 million cwt potato crop for 2020, the report notes. This would make for 7.8 million cwt fewer potatoes than growers in the 13 reporting states produced in 2019, a 1.8 per cent decline.

“The final output will depend upon growing and harvest conditions for the remainder of the season. However, other information points to a pending imbalance between fry-quality potato supplies and Russet table potato supplies.”

French fry processors reduced contracts for the 2020 potato crop between 15 to 20 per cent.

“NAPMN believes that the processing contract volume reductions anticipated that demand for frozen potato products would fall 10 per cent short of pre-COVID levels for all of the 2020/21 marketing year. Recent trends suggest that The actual decline in demand may be 5 per cent or less.”

If there are normal yields it will generate a large increase in Russet table potato supplies, the report notes. If this does happen the surplus may be needed to offset the expected deficit in the frozen processing sector.

Red potato acres are flat compared to last year. While the USDA data suggests growers were cautious about increasing this year’s Yellow potato area, this may limit sales growth for Yellow potatoes.

“The industry cut early-season contract volumes for chip potatoes, to accommodate 2019 production increases. The cuts appear to have created a tight balance between supplies and demand. Buyers are not anticipating a large supply of open chip potatoes this year.”