12 September 1997

Spud profits should return

Better than last year is the hope for potatoes at Dowrich as the Lees make a start on lifting. Philip Clarke reports

MAINCROP potato lifting is under way at Dowrich and expectations are that, despite the blighted summer, profitability will return to the enterprise.

Margins could hardly be worse than last season. Depressed prices then knocked a £12,000 hole in total farm profits. That compared with a £31,000 positive gross margin in 1995 and £79,000 the year before that. There is still much uncertainty about what will happen to prices this season.

"The area planted nationally is well down," says Anthony Lee. "But higher yields following a wet growing season should make up for that." Everything will then depend on how much of that crop is sale-able, after disease problems and waste.

"It wont be the best year ever, I am sure, but at least we should be back in the black," he predicts.

The budget, prepared with consultants Axient at the start of the season, pencilled in a £21,000 gross margin from the 21ha (51 acres) of Estima, Fianna and Pentland Dell. But that was based on an assumed average price of £75/t.

GB producer prices are ticking along at about £60/t, which suggests any return to profit will be more modest than that budgeted.

But Anthony is optimistic on two counts. First, yields from the 6ha (15 acres) lifted so far have been above the farms historic average of 37t/ha (15t/acre). Initial estimates for Estima, which makes up 80% of the Dowrich potato area, point to nearer 44t/ha (18t/acre) after sorting.

Second, he believes there will be a lot of maincrop potatoes coming to market soon after harvest which will not have the quality for storage. This will put pressure on prices bet-ween now and Christmas, he predicts, but should then be followed by a spell of tighter supplies and firmer prices as the season progresses.

"From what I have seen, our own potatoes have well set skins and I am confident they will store."

Dowrich did see some blight, initially in the Fianna and then in the Estima. "But we went in immediately with a tin-based spray and carried on with a tight control programme, mainly using Invader and Reposte."

As soon as the tubers were big enough, nearly all of the pota-to crops were burnt off using Reglone to keep the blight in check.

Early desiccation also means all the fields are now ready for lifting, so if the weather remains "catchy", the Lees can at least get the crop harvested in between the showers.

Anthony estimates his total costs for the potato enterprise at about £2471/ha (£1000/acre). This is similar to last year, after allowing for a heftier fertiliser and spray bill, but lower seed and contractor costs.

If yields hold up well and prices improve later in the season, then the final performance may not be so far removed from budget.

Meanwhile, the Lees have already made a start on selling some of their potatoes. While most of the 800t plus produced goes through local co-op Banjo Potatoes, some is sold direct to consumers through the farm gate.

"We started in July as soon as the tubers were big enough, selling them in 25kg, 12.5kg and 6.25kg bags," says Anthony. "During the summer people prefer the smaller bags, as the potatoes do not store so well. But now, as it starts to get cooler and the skins have set, they tend to go for bigger bags.

"The retail side is an area we need to develop, especially as we are growing a quality product that the customer wants," says Anthony. He recalls the time when he bought in potatoes from another source to extend the selling season, only to find the quality was not up to scratch and his customer base was damaged.

"The problem is, however, that if we get any bigger, then the whole operation takes more time and a lot more effort to sell just a few more tonnes."

The main preference is for Estima, and middle brother, Roger, always makes sure there is a range of sizes available.

Up to 20t is sold direct each season, with a small levy paid to the co-op to ensure other members are not disadvantaged. "Obviously this small volume is not going to have much impact on total potato margins," says Anthony. "But in a season of disappointing prices, every little helps." &#42

Despite a lot of "throw-outs", yields of Estima are above average at Dowrich.

FARM FACTS

&#8226 A 235ha (580-acre) family farm in mid-Devon, run by Anthony Lee, his father Michael and his brothers, Roger and Christopher.

&#8226 Dairy herd of 252 Holstein Friesians averaging 5800 litres a year.

&#8226 Outdoor pigs reared from 220 sows.

&#8226 Potatoes grown on the farm and on rented land.

&#8226 Strong emphasis on co-operative marketing.