Subdued potato outlook

AFTER A BUOYANT start to 2004, potato growers have seen prices fall back to more marginal levels.

Cautious planting and a poor harvest across the whole EU helped push up early crop prices to an average £185/t.

Nevertheless, total British planting in 2004 eventually exceeded expectations at almost 131,000ha (323,600 acres).

Many potatoes were lifted with a lot of soil, and some growers decided to sell the late crop straight to market because of storage fears, pushing the British Potato Council GB weekly average price down to £83/t.

The price outlook for the new year is stable, with the London futures market quoting £81/t for April 2005 when FW went to press.

But there are some unknowns. Some analysts say CAP reform jitters will take a big chunk of UK potato land out of production in 2005.

Landlords are worried about losing subsidy entitlements by renting out their land to growers. Typically, over 30% of the potato crop is on rented land.

Recent trends suggest there is likely to be a further small decline in planting for the 2004/05 season.

But some think decoupling may have the opposite effect in Europe, by putting money in farmers‘ pockets and encouraging them to turn to higher margin crops, such as potatoes.

Overall, the outlook is for stable prices into next year. The prospect of more abundant supplies from Europe and the Mediterranean is likely to keep prices close to current levels.

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