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U.S. potato exports face many challenges

U.S. potato exports have faced a great deal of adversity in the current marketing year (July 2020 – June 2021). Potatoes USA says in a news release that demand for frozen potato products declined precipitously in the spring of 2020, and this lower level of demand carried over through the first quarter of the marketing year (July – September 2020).

The industry body says as restrictions eased and the markets adjusted, demand began to return in the fall, but then shipping issues began to limit the ability of U.S. exporters to meet this demand. The lack of containers, port congestion, delayed and canceled shipments, and double costs have increased in 2021.

Despite the return of demand, this has limited exports and resulted in shortages of frozen, dehydrated, and fresh potatoes in many markets. Importers have begun to ration the limited supplies, prioritizing large chains and established accounts.

U.S. exports of frozen potato products for July 2020 – March 2021 were down 10% from the same period the previous year. However, they were up 13% in March 2021. The strongest market has been Mexico, up 51% for the marketing year to date (YTD). Taiwan and South Korea are also positive for the marketing year, but both showed declines in March due to shipping issues. Japan, the largest market, was doing well for the first six months, but problems with shipping and renewed restrictions have resulted in a 13% decline YTD and a 22% decline in March. Exports to China have been impacted by the testing of imported frozen products for COVID-19, retaliatory tariffs, and increased domestic production. They are off by 39% for the YTD.

U.S. exports of dehydrated potatoes are down only 3% for the YTD period and are up 19% in March. Exports to Japan have remained strong, up 11%, while South Korea has continued to grow and is up 50% YTD. All other markets in Asia are down for the year, leading to a 6% decline to the region overall. Mexico is again positive with exports up 3% YTD.

U.S. exports of fresh potatoes (chipping and table-stock) are even for the marketing year, but up 32% for March. Mexico has again been a big factor with exports up by 6% YTD and by 31% in March. While exports to the largest fresh market, Canada, are down 12% YTD, they were up 39% in March. Fresh exports to Asia have been very strong, up 17% YTD and 25% in March. Taiwan, the largest market in the region, is up 26%, while Japan is up 81% now that the U.S. has year-round access for chipping potatoes. Korea continues to grow as well and is up 38%, while Vietnam is up 210%, but there are indications that due to the tariff differential with other suppliers, the chippers there may not repeat this level of business in 2021.

Source: Potatoes USA. Original release here, with links to export figures.
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