UK potato growers challenged by low prices and crop concerns

Ex-farm potato prices have fallen sharply in recent months, with an abundance of potatoes across Europe weighing heavily on domestic markets.

An exceptionally dry spring aided earlier plantings this year. However, the prolonged dry weather has meant crops in the UK have generally fared worse, with lower yields likely.

The outlook for potato growers in England appears relatively poor unless sufficient irrigation is available. Growers in Scotland have received more favourable weather and yields are projected to be higher.

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Craig Elliott, a market analyst at Expana, said:

“Potato prices in the UK and Europe have tumbled in recent months, amid high stock levels held by growers, reduced consumption and limited free-buy purchasing, as many buyers are covered by contract.

“Prices stand in stark contrast to year-ago figures, when prices rocketed on the back of tight supply.”

The Expana Benchmark Price put English white packing potatoes at £90/t in mid-July, down almost 88% on the year.

The UK potato market remains mixed, with top quality old crop still commanding a premium but lower quality stock struggling to find a home on free-buy markets.

This has resulted in a greater volume going to animal feed and AD plants.

Washed whites have been trading in the region of £250/t to £320/t, with the best quality approaching £400/t, while Accord has been quoted at between £170/t and £220/t.

New-crop lifting has been steady, with quality concerns related to bruising and low yields in some areas.

Meanwhile, prices on the Continent were back by 70% on the previous quarter and 90% on the year.

Mr Elliott added: “Sources in Europe have noted deterioration in crop quality in recent weeks, particularly in areas with lower rainfall.

“In addition, some crops were planted particularly early, meaning that they are now ageing.

“While market participants are cautious to make predictions before harvesting is complete, some anticipate that potato supply will continue to be high, one way or another.

“It remains to be seen if insufficient rainfall will indeed have a significant impact on supply levels and, therefore, prices.”

Europe

Dutch firm DCA Market Intelligence says the European potato market is under severe pressure this year, with the EU potato area forecast to be its largest for several years, increasing by 77,000ha to total 1.47m hectares.

It has warned that the potential overproduction of processing potatoes could push the current market further out of balance, with European exports already struggling.

European exports are becoming less price-competitive on the global stage, with strong competition from India, China, and Egypt to major markets in Asia and the Middle East.

DCA analysts said: “While drought in parts of Europe will likely prevent a record crop, the balance between supply and demand remains under extreme pressure.”