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Analysis: A look at British chipping markets from a supply and demand perspective

With the coronavirus pandemic hitting the UK domestic potato trade, we have estimated a 1% drop year-on-year in the GB potato area for 2020/21, with the provisional area standing at 119Kha. AHDB market analysts (Potatoes and Cereals) Alex Cook and Anthony Speight prepared this report in which they take a closer look at how things are stacking up for the British chipping market at this time.

They write that almost all farmers and growers had committed to seed, fertilisers, and machinery in preparation as covid-19 swept across Europe sending the continent into a state of lockdown.

This has been disastrous for the British domestic bag market which has felt a significant ongoing pressure since the end of March.

Not a tremendous amount of 2019 chipping potatoes were left as we entered 2020 cropping year. We did see free-buy bagging prices severely pressured from when new-crop lifting commenced, as supplies exceeded demand significantly.

In this article Cook and Speight aim to:

  • Forecast Britain’s potential chipping area for the 2020/21 marketing year.
  • Review pricing of chipping potatoes since covid-19
  • Furthermore, demand going forward and how this could affect the ex-farm price of chipping potatoes.

A look at the supply side of chipping markets

The area of fresh bags (6.1Kha) and chipping (13.7Kha) potatoes in 2019 was at 19.8Kha, accounting for 16.5% of total planted GB potato area.

From this we can expect that the area of fresh bags (31%) and chipping (69%) will account for c.19.6Kha of the 2020 area. 

Based on this figure and using a five-year average yield of 46.2t/ha, we may see the volume of GB fresh bag and chipping potatoes at around 905.8Kt this season if there are minimal area losses.

What is critical to note is there is a large degree of lifting still left to do, therefore weather events (as experienced last year) could change this figure.

In the table above is the possible supply scenario outlook for the fresh bags/chipping sector for the 2020/21 season.

But what is a critical note, is that without an extreme weather event we have a large supply of bags/chipping potatoes coming onto the market, which depending on Covid restrictions going forward may not be met with a certain level of demand.

Demand: What has happened and a look forward

From the end of March, through the beginning of the

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Urschel

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