The UK is on the last stretch before the new crop comes onto the market but, so far, it does not look likely that the season will end on a high. The last three months have, on balance, been fairly average in terms of supply and demand, product quality and market prices. The majority of growers and suppliers fear that there is no going back now that prices for the maincrop have evened out and that prospects look “unexciting” at best, until the new-season crop comes on stream.
Others, in a more positive frame of mind, believe that returns could show some improvement in the next two months.
Either way, there is light at the end of the tunnel in the shape of the new season, set to get underway following the first token liftings expected in the third week of April. If the warmer weather continues, consumer demand is likely to switch from maincrop to new potatoes as soon as they become available.
But for now, the majority of packers have sufficient contract and committed stocks. There is limited interest in poorer stocks and recently lifted over-wintered crops, which are only adding to the ample volumes still on the market.
“Growers have been moaning that they have packing material that they wish they had sold off the field, rather than waiting until now,” says one insider. “Only product that is exceptional quality is holding down any kind of premium and even then, it is not dramatic.
“I think there will be pretty flat prices right the way through towards the end of the season.”
This comes amid fears that the net value of the maincrop is not as high as it should be and that pushing down retail prices will devalue the category in the long term. But even with these mounting concerns, growers and suppliers have recognised the opportunity presented by the rise of value lines at the major retailers as a new avenue for those looking to shift lesser-quality stocks.
“Retailers and their customers are gaining the most out of the situation as it is at the moment,” claims one supplier. “They are maintaining their very aggressive margins and they want very low price points, but they are not prepared to give up any of their margins. It is not a lot of fun for those stuck at the other end.
“But the question is, could growers stand another year of low returns? To be fair, some growers did really well last year and this year, they will have to see how it goes. However, if we get a good crop this year and prices remain unexciting, there could be a fall away from the business in 2010.”
But it is unlikely that potato growers will leave the business this year, with returns for alternative crops such as wheat and sugar beet failing to present a real incentive.
For now, the market is stable, with fixed programmes working out well, but not much activity outside these long-term arrangements. “Most of the big players are contracted comfortably,” says one supplier. “Free buying is only for the very brave, but there will be some growers who sit on product until May or June and try to market it then - I can’t see the upside, but I can see plenty of downsides.”
Imports are very low this year and while normal programmes and new potato sendings are still at the same levels, there has been very little on top of this. “UK importers panicked last year and ordered maincrop potatoes to come in, but this has not happened this season,” says one insider. “Talking to growers and exporters in the Netherlands last week, it looks as if they are suffering two-fold,” he explains. “The exchange rate has meant that their finished product is more expensive in the UK so they have lost sales, while demand from the foodservice sector - which traditionally takes a lot of imported chips - has slowed down as fewer people are eating out.”
But looking ahead to the new season, hopes are running high for an early spring, efficient planting and strong demand for early crops, if the weather stays on track.
Planting has so far made good progress in southern parts of the UK, where soil conditions have been good, but crops for pre-packing have been held back until soil temperatures improve. This is making growers cautious about removing polythene from the crops, but some will be uncovered in the next few weeks.
The Midlands and western areas have ploughed ahead and growers are well ahead of last year, even though there has been some rain at times. Hereford has had two consecutive years of wet conditions and growers there say there are bigger underlying issues concerning yield that need to be addressed. The earliest planted crops under polythene in regions including Pembrokeshire, Cheshire and Anglesey are emerging well.
Over to the East, soils remain wetter than expected, particularly in Cambridgeshire, where growers are in no hurry to start planting.
The North is making better progress than this time last year, when snow halted proceedings, but there has so far been little activity in the North East, even though growers are ready to make a start soon.
According to the Potato Council, total plantings up until March 27 reached an estimated 17,000 hectares, compared with 8,000ha last year and 21,500ha in 2007.
“It is beautiful outside at the moment and the planted area to the end of last week is the highest in the last five years other than in 2007, when we had a very early spring,” says one grower. “At the moment, we are heading for a very early spring and a very good crop potential. If you are looking for high prices caused by low yields, this does not look like it will be the year for it, but it is still very early days yet so we will have to see.”
VALES SOVEREIGN REIGNS AT TESCO
One year on from the launch of Vales Sovereign, the variety looks to become one of the most successful varieties in decades, says Greenvale AP technical director Paul Coleman, together with Tesco produce technical manager Tim Pratt.
Farmers love it because it is disease resistant and easy to grow, exclusive retailer Tesco loves it because sales are rocketing and consumers love it because it tastes great and is so versatile, while environmentalists love it because of its low carbon footprint. These are just some of the reasons why Vales Sovereign, bred by the Scottish Crop Research Institute and developed by Greenvale, was named 2008 Variety of the Year in the Tesco Fresh Produce Category Awards.
The nationwide launch last year followed successful commercial trials, where it performed very well in taste panels and sold strongly in test stores. The variety has been bred to combine the best of British, with its texture and creamy flavour, which stands out in comparison to other all-rounder potato varieties on the market, which tend to have a floury texture.
In a move that underlines the versatility of the variety, Greenvale has just launched Vales Sovereign as box bakers, marketed under the Jackpots brand. They are size-graded for baking and are available to wholesalers in 15kg boxes.
Greenvale has supplied Tesco for more than 25 years. “It is very much a partnership - commercially and technically,” says Pratt. “We need to develop new products and to have new product development plans in place. Greenvale and Vales Sovereign are a key part of that programme.”
The Tesco Variety of the Year award looks at all fresh produce, including fruit as well as vegetables, so a humble spud taking the crown was something of a surprise. “We need to re-energise the customer about potatoes - the same varieties have been around for many years,” says Pratt. “Vales Sovereign is something new to put in the potato section and that is what makes it so important…
“We have had a great reaction from customers - the sales speak for themselves. The figures are compelling - 2,000 tonnes in 2006-07, 15,000t in 2008-09, a projected 35,000t in 2009-10 and a target of 60,000t for the year after. The variety has already made the top 20 in sales of potatoes and will make the top 10 soon; it will probably end up in the top five.
“By working in partnership with Greenvale, we have produced a highly successful new potato variety. That is because the team at Greenvale has ensured that everything about Vales Sovereign fits in with our programme, including the packaging, the quality controls from the field to the factory and, importantly, the variety’s reduced carbon footprint - a result of it requiring less water and less fertiliser.”
It is a good sign that UK growers who have planted the variety have so far come out smiling. Martin Hammond, farm manager at GS Shropshire & Sons Ltd, claims that Vales Sovereign stands up well to the pest and disease risks associated with the deep fen soils in West Norfolk.
John Rix from PG Rix Farms has sown Vales Sovereign on a medium loam soil and achieved what he describes as “excellent tuber quality”, with no evidence of growth cracking, foliar blight, blackleg or common scab. “This is indeed an exciting variety for growers, packers and consumers alike,” he says. “We’re delighted to be involved in the Greenvale programme.”
Greenvale’s Growers’ Day, held at the Haycock Hotel near Peterborough back in February, was designed to recruit new growers to the Vales Sovereign programme in order to cope with the increase in demand. The event was over-subscribed - around 40 growers were expected and more than 50 actually attended, coming from all over the UK, despite atrocious weather conditions.
We were absolutely delighted with the support from growers attending the day. What’s more, we have had an excellent response - most of the growers who came have either already decided to grow Vales Sovereign, or plan to do it as soon as they can.
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