Plc switch lifts potato fortunes
By Robert Davies
TURNOVER has doubled at Pembrokeshire potato company Puffin Produce since it converted from a growers co-operative to a farmer-owned plc.
Three years ago Puffin Potatoes marketed around 10,000t of potatoes a year as a bagged commodity. The group sold through a merchant and had no packing facilities in the county for its highly perishable product.
This year Puffin Produce expects to market about 20,000t of potatoes harvested by 40 growers from about 728ha (1800 acres), or almost two-thirds of the planted area in Pembrokeshire. About 80% of the crop will be sold to supermarkets, compared with 30% three years ago, and an investment of over £1m has spawned 16 product lines.
Instead of wholesaling bags of first and second earlies, the company now trades potatoes between May and Christmas and winter cauliflower between October and April. Turnover in 1998 was over £5m.
"The old co-operative did a good job establishing the Puffin brand, but it was cumbersome and slow to react to market change," says managing director, Colin Bailey. "Puffin Produce is the reincarnation of the co-operative. It is still owned by its farmer shareholders who are represented on the board. But it is an autonomous company and its daily management is in the hands of potato trade professionals."
Such is the confidence in the standards set that every product with a Puffin label carries a hot-line telephone number that allows customers to speak directly to Mr Bailey. "We believe that supplying quality products consistently is the key to growing potatoes successfully so far away from the main centres of population."
He has worked closely with Tesco, Asda and Somerfield. Puffin potatoes are now sold in every Tesco store along the M4 corridor. Marks & Spencer is also supplied through an intermediary.
Tom Spittle, who grows 14ha (35 acres) at Treleddin, St Davids, says he would not be in potatoes without Puffin Produce to do the marketing.
Growing and harvesting the crop present enough problems," he says. "Costs now exceed £2965/ha (£1200/acre) excluding labour. Individual farmers certainly cannot afford to put in grading and packing facilities needed to sell to the supermarkets, who want perfection every time."
But he will judge the companys performance more on farm-gate prices over several seasons than its profile with the supermarkets and end-of-year dividends. *
Stocks blamed for OSR crash
OILSEED rape prices have plummeted just weeks before the end of the season when crushing plants will close for their annual break.
Old-crop rape values fell £11/t over the week to about £113/t ex-farm on Tuesday, says the trade. Harvest prices remained stable, trading just slightly below spot at £112/t.
Despite the downward pressure from large EU stocks, this weeks fall is being blamed on larger rapeseed stocks in the UK than were originally thought.
And with only weeks to go before the end of the season, traders are urging farmers to clear their sheds before harvest.
This most recent fall has checked any recovery seen over the past few weeks as the market becomes plagued by international factors affecting the soya market. *