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The global impact of coronavirus on potato production: Examples and lessons learnt

One country that has routinely been in the news for their impressive handling of the outbreak is South Korea. Just as local Government across the Asian nation were able to act to address the public health impacts, they similarly acted to address the impact that social distancing had on their potato supply.

The mountainous Gangwon province in the north east of the country is known for its potatoes. However, due to the outbreak, the supply chain was significantly disrupted due to school cafeterias closing and 11,000 tons of potatoes in storage were at risk of rotting. 

Aware of the financial impact that this would have on local farmers, Gangwon Governor Choi Moon-soon launched a campaign to reach out to urban populations and sell the potatoes directly to consumers at a 50% discount with no delivery fees.

In addition to a strong social media campaign, they also included recipes with each delivery to inspire people to cook new dishes. When the website launched, it sold out within the hour and within the first two weeks, it had sold a total of 4,000 tons of potatoes.

In Canada, the closure of the hospitality sector in light of the coronavirus caused a significant threat to potato growers. 75% of Canadian potatoes are consumed in restaurants or cafes – predominantly as French fries. Without those routes to market, there was approximately 200m pounds of French fries stuck in storage.

However, as consumption patterns changed, the Canadian public began to purchase more potato products at the supermarket. Unsurprisingly, it seems that people sitting at home in the lockdown wanted to snack on bags of crisps and, consequently, crisp sales increased by 23% on 2019. Fresh potato sales at grocery store increased too – by a considerable 60% – as people began to cook more at home.

One might think that the excess of potatoes that had been destined for the fast-food chain fryers in Canada could be redirected to the supermarket shelves. However, industrially produced French fries come from a particular variety of potato that are larger and more elongated than the varieties commonly available in supermarkets. This is because they have been bred to make it easier for them to be cut into batons and packed into bags for food service.

The potato growers in the USA too have faced significant challenges with accessing markets and oversupply. The F.O.B. price in Idaho dropped by over 50% at the start of the lockdown in April, and potato farmers across the country have seen prices fall as processing plants close their doors and a surplus builds up.

Worse still, the backlog of supply and the instability of the market made processors apprehensive about the future and many delayed making critical investment in processing plants, such as the McCain Food facility that was planned for Othello, Washington.

Fortunately, early indicators suggest that segments of the market seem to be recovering quickly. In the week ending May 2, sales of frozen fries by the fast-food outlet Wendy’s are down only 2.1% year-on-year. Hopefully, these signals will be sufficiently to get companies, such as McCain, to feel more confident in the future of potato production.

This issue of excess potatoes is impacting supply chains across Europe too. Belgium is famous the world over for its fries and UNESCO list them as a Cultural Treasure. However, due to the COVID-19 lockdown, 750,000 tons of Belgian potatoes have no route to market due to the closure of the food service sector.

Belgapom, the trade association for the industry in Belgium, has been working with domestic food banks to redirect potatoes to feed families that are food insecure in order to ensure that the crop doesn’t go to waste. 6.1% of households in Belgium are estimated to experience food poverty and this figure is anticipated to rise with the lockdown.

In addition, Belgapom is using a food distribution app, Too Good to Go, to connect with consumers across Belgium, and has urged Belgians to actively increase their consumption of fries. Preferably with mayonnaise.

So what is the situation in the UK? Given the closure of restaurants, including the ubiquitous fish n’ chip shops of most high streets, potato growers across the UK are struggling to sell their crop with 189,000 tonnes of chipping potatoes impacted.

To address this supply chain failure, individual groups have been working to develop new routes to market. For example, Slow Food Birmingham worked to connect potato growers with food insecure families across the city. To transition this match-making service to a national scale, the Agriculture and Horticulture Development Board (AHDB), the levy board that oversees UK potato production, hopes technology can provide a solution.

AHDB launched a new buyer and grower ‘match-making’ website to tackle the surplus of potatoes and to connect growers with retailers that have routes to market. That said, hopefully, as the lockdown begins to ease, more takeaway stores will begin to reopen, allowing conventional routes to market to resume.

At a Parliamentary inquiry into the impact of COVID-19 on food supply, Jack Ward of the British Growers Association said the sooner the chip market can be opened up, “the better for everybody”.

Lessons learnt

When considering the impact that the lockdown has had on potato farmers across the world, it is striking how similar the cases are.

What becomes clear is the scale and industrialisation of production of potatoes for the food service sector. Farmers who grow varieties for fries struggle to redirect those potatoes, given the segmented nature of the business. Technology can surely help to connect these producers to find alternate routes to market and public campaigns can inform consumers of the situation.

However, this situation highlights the weakness within the industrialised food supply chain. One break in the chain (the closure of the food service sector) and the whole potato industry fell apart.

What is needed is greater resilience. Coming out of the COVID-19 pandemic and associated lockdown, the potato sector will need to re-examine the market dynamics so that they are better able to weather market shocks when they inevitably come.

It’s necessary that we review supply chains so that farmers are not entirely dependent on one route to market and so can adapt to shifts in consumption. Farmer greater bargaining power and greater autonomy going forward in order to ensure that this extreme of glut vs. dearth doesn’t occur again.

Source: This article was written and presented to Potato News Today for publication by Honor May Eldridge.
Website: honormayeldridge.com
Photo above: Drumheller OnlineWay Too Many Potatoes, Farmers Find Ways to Dump Their Crops

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Lukie Pieterse, Editor and Publisher of Potato News Today

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