Both the Flemish PCA and the French RNM are recording a price for Fontane this week that rises by €5 per 100 kilos. This breaks the price impasse that has lasted for three months. Now that it is clear that an early spring is really not happening, processors are trying again to persuade farmers to sell potatoes.
You could place a ruler along the Belgian and French French fry potato prices over the past three months. In mid-February, the price level for Fontane was set at €35 per 100 kilos. Until this week, buyers did not deviate from this price. With a €5 increase per 100 kilos, that changes at the beginning of May.
Dutch price lags behind
The German Reka price made a first move at the end of April, to €37 for the largest European French fry potato variety. This is already remarkable, considering that the German potato price is normally following and not leading. The only deviating line is that of PotatoNL. At the end of March, the Fontane price managed to go slightly higher, only to step back into its box. On Monday, May 6, €38.50 was displayed on the boards. 'Our' potato price lags behind the Belgians and French, who set a price for the current week. The €40 level should also appear on the boards in the Netherlands next week.
This somewhat shows a similar picture as was seen last spring. Planting also started slowly then. Especially in Belgium and Northern France, just like it is now. The situation is currently more urgent though. Think of extreme rainfall and the shortage of seed potatoes. Early potatoes could only be planted late, or have not been planted yet. It is also clear for processors that there is no need for rain during an early harvest, which means an extra month with the potato puzzle. Given the stocks in Western Europe, this should not be a problem, but there is also a high consumption due to the strong demand.
Futures market
Another factor influencing pricing is the settlement of the April 2024 contract on the futures market. Price changes no longer affect the cash settlement, which was even slightly reduced during the settlement. This opened the way upwards, which was clearly felt in the European market segment.
Belgian farmers are the most affected in Western Europe, according to the weather maps. Since the beginning of October last year, huge amounts of rain have fallen. That tap is still not turned off. "Between October 15 and April 30, 900 millimeters of water fell in parts of Flanders," says Pieter van Oost of the Farmers Union to Vilt.be. "That is more than what normally falls in a whole year. It results in a very high groundwater level."
France slightly drier
Farmers in (Northern) France have fared slightly better. It is also wet here - especially along the coastal areas - but they were spared the worst rainfall. Between 50 and 75 millimeters of water fell in April. Early May also did not pass very dry. However, this is less than the 80 to 125 millimeters that locally fell in Belgium and the Netherlands. This makes sowing and planting a challenge in all areas.
Is €40 then the maximum? Long-term storers are stuck in the game. Especially those who have mechanical cooling and a good quality product at hand. Amounts up to €60 from last year are still fresh in memory. But pride can come before a fall. Unfortunately, this season has once again shown in the onion market. With rising outdoor temperatures, there are also cells, cooled with outside air, that will soon have to be bid farewell. Processors are likely to take it easy, although experience shows that once the genie is out of the bottle, an upward movement can sometimes be difficult to stop.
Prices up to €45
There are signals in the market that higher amounts are already being offered for Fontane. This mainly concerns the export market, although a processor 'in need' can also play a role here. Insiders report that amounts up to €45 are being paid for Fontane for delivery in early June. Let's say a euro storage premium per week. If potatoes are secured here - and transactions are reported properly - the market has a goal in sight. For the 'extra kilos', the price is currently €40, with the further course of the planting season being a leading factor in price formation.