Analysis Potatoes

Will the record price of last season be pulverized?

June 7, 2024 - By our team of market reporters

Will the average price of potatoes in the coming weeks pulverize the record (if you can say that) of last season? If you look at the developments in the potato market now, that could very well be the case. Last spring was also exceptionally late, pushing the potato price up rapidly. The overall situation towards mid-June 2024 is significantly worse with many fields still needing to be planted and a high disease pressure in fields that are already in the ground.

Belgapom noted on Friday, June 7, €55 per 100 kilos for both Fontane and Challenger, which is exactly the same price level as last season. The price in week 25 last season made another jump and reached €60. The expectation is that the highest price level of last season will definitely be reached in the coming period. The question is: can it go even higher?

Given the current situation, it is certainly not unthinkable. Consider this, there is still a significant amount to be planted, especially in Belgium, and across the EU-4 countries, the exceptional amount of rainfall has caused a lot of damage in the already planted fields. Insiders estimate that the potato harvest for the 2024/25 season could turn out to be 15% to 20% lower than what could be harvested under 'normal' conditions. 'Normal' can now be omitted when it comes to potato cultivation.

Where is the risk?
In recent years, there was anticipation of price risk and certainty was sought in the various contract forms - directly or indirectly - offered by processors. Today, the risk on the cultivation side is a much bigger concern. The fact in 2024 is that while the potato harvest can be priced in early, the certainty of the desired/expected volume is decreasing due to all uncontrollable external factors.

Already, the futures market for the April 2025 contract is approaching the €40 level. A decent base price (well above the average contract level) to hedge (or click) potatoes. However, the uncertainty about the coming months regarding the further progress of the growing season is such that for now, people seem to be taking a wait-and-see approach. In that sense, price records are also being shattered for the new season. All the ingredients, however bitter for many growers, are on the table. As the season progresses, the question is at what price level the ceiling will hit in terms of the futures market. Will a price range of €40 or €50 become the new normal for the coming months? Keep in mind that other stakeholders in the chain also have no idea how the picture should be painted for the upcoming season and what price goes with it. This already sparks curiosity towards the 2025 harvest year!


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