World News, Russia, Europe, Spud Smart Winter 2011

Russian Potato WoesWorldNews_WorldReview

The serious state of affairs in the Russian potato industry has made headlines in the mass media in Russia and around the world for the past couple of months. An extremely hot and dry growing season is mostly to blame for the severe crop losses suffered by Russian potato growers. Exact statistics are rare, but the latest figures from the Russian Ministry of Agriculture suggest production should reach 22 million tonnes for 2010 compared with 31 million tonnes harvested in 2009. Total Russian imports, according to some observers, could therefore extend to over 500,000 tonnes this season compared with average levels of approximately 375,000 tonnes, although others are forecasting imports of over two million tonnes.

The Russian media is reporting a steep rise in potato prices at the retail level, not only due to a shortage of domestic potatoes but also because of high import costs of table potatoes. There is some concern among exporters about rejection levels and payment, particularly as the season progresses. Russian authorities reacted quickly in November when nematodes were discovered in a delivery of potatoes from Belgium, threatening to prohibit imports not only from Belgium but from France and the Netherlands. Some market analysts hope that Russia’s need for potatoes might open export opportunities for growers and dealers in Canada and the United States.

European Crop Down

“Estimates suggest that three to five per cent of the total potato crop in Belgium, France and the Netherlands was lost due to frost”

Russia was not the only country hit with unfavourable growing conditions this past season; problems with crops were experienced in much of Western and Eastern Europe. The North-Western European Potato Growers organization estimates a total harvest for processing and table potatoes of 23.8 million tonnes in the five major potato-producing countries of Germany, Holland, the United Kingdom, France and Belgium. This figure is 4.4 per cent (one million tonnes) less than was harvested last year.

Only in Belgium have more potatoes been harvested this season over the last, with an increase of 8.8 per cent to over 3.5 million tonnes. Total potato production for the European Union was estimated at 40.3 million tonnes, compared with 45.4 million tonnes in 2009. Production decreased by 30 per cent in Lithuania, 25 per cent in Romania, 21 per cent in Slovakia and six per cent in Poland. A sudden sharp fall in temperature in late November and early December led to additional losses of unharvested potato crops in the EU. Estimates suggest that three to five per cent of the total potato crop in Belgium, France and the Netherlands was lost due to frost.

German Growers Disgruntled Over High Costs and Low Return On Investment

The German Farmers’ Association recently noted that the revenue situation of farmers in that country has deteriorated considerably in the last number of years.

Prices of potato seed, fertilizer, energy, irrigation equipment, as well as land rent and wages have risen sharply and continue to rise. Weather extremes in the form of heatwaves, severe droughts and flooding are causing irreversible losses. Processing potato growers’ prices are determined before harvest time preventing growers from benefitting from positive price developments in the open marketplace. It has been reported that many of these growers are now considering leaving the potato industry, moving on to other crops such as maize, which they believe offer a better return on investment.

Lukie Pieterse