November/December 2020 - 18

POTATOES
SUPPLY CHAIN CONCERNS
Uncertainty lingers in
potato processing supply
COVID SITUATION LEAVES PROCESSING SUPPLIERS
UNSURE HOW TO PROCEED INTO 2021
By Zeke Jennings
Managing Editor
POTATOES HAVE A LONG JOURNEY
from breeding labs to restaurant
fryers. Over a period of five years,
or even longer, they'll pass through
greenhouses, seed farms, commercial
farms and processing facilities before
finally reaching their destinations.
Typically, farms and processors that
make up that supply chain would be
making plans for the 2021 growing
cycle right now. Those folks are all
doing something else, however. They're
waiting, uneasily.
With foodservice demand still
well below normal due to schools,
entertainment venues and many
restaurants not operating at full capacity
because of COVID-19 concerns, food
producers really don't know what the
demand is going to look like next year.
" There are no real answers right
now, " said Dan Lake, owner of Lake
Seed in Western Montana.
Lake's customers are commercial
processing potato growers, many of
which are Washington farms that
typically work out contracts with
processors before even planting their
potatoes in the spring. When COVID
restrictions came down in March, just as
planting season was starting, processors
informed commercial growers they
wouldn't need as many potatoes.
Acreage in Washington was down about
12% from normal this year to 145,000
acres, although estimated production
in Washington is only projected at an
8% decrease, according to USDA data.
Projected production in Maine, which
also grows a large number of processing
potatoes, is expected to be down 20%
18 NOVEMBER /DECEMBER 2 0 2 0
due to yield losses because of extreme
drought conditions.
Acreage reduction in Washington
means demand reduction for seed
growers like Lake, who wound up giving
away 1.5 million pounds of unmovable
seed potatoes left over from 2019 -
which he originally had contracts for -
to be cattle feed. That excess was even
after Lake's 2019 crop was " short " due
to less-than-ideal growing conditions.
Lake said he empathizes with the
commercial growers and the processors,
who were put in a tough spot. He said
everyone is in limbo, but added the
further down the supply line you are,
the more uncertain it is.
" They don't want to be in this
position, " he said of commercial
growers and processors. " It is a really
sick feeling on the seed side, though. "
Market shift
With the lack of foodservice and
processing demand, the retail and
tablestock markets elevated and have
so as consumers ceased to eat out as
often and cooked at home more. After
restrictions hit, some processing farmers
who grow varieties also desirable in the
retail market were able to pivot their
stocks and sell to stores.
In spite of what most people outside
the potato industry might assume, not
all potatoes are desirable for produce
departments in the grocery stores. In
addition to some processing varieties,
potatoes grown to be seed for the
following year are not meant for retail.
Idaho Potato Commission President
and CEO Frank Muir said Idaho's highvolume
growth of Russet Burbank
proved beneficial in this case, but
acknowledged versatility is not a high
priority for growers that specialize to
one market, which many do. In the
case of seed potatoes, no matter the
variety, finding a commercial buyer
is extremely complicated.
In addition to some
processing varieties,
potatoes grown to be
seed for the following
year are not meant
for retail.
" Idaho is known for the Russet
Burbank and it is the most versatile
potato, but it's also difficult to grow, "
said Muir, who later added: " Most of
the stories you heard of people giving
away potatoes were seed potatoes. "
In Washington, very few acres planted
are not contracted when the seed goes in
the ground. Growers plant the varieties
their processing partners want, grow
them to the size they want and store them
how they want. This well-oiled system
has provided stability for Washington
growers over the years which growers
who depend on " open acres. "
" Our growers were so heavily
contracted in the past because that
was the way of controlling the risk, "
said Chris Voigt, executive director,
Washington State Potato Commission.
" It was a lot easier to go into a contract
with a processor and have an expectation
of what your profit was going to be, you
don't have huge swings. You're not going
to be able to take advantage if the price
were to double, but you also don't have to
worry about the price being cut in half.
November/December 2020

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