Industry Cooperation Called 'Unprecedented'
UNITED Potato Growers of America met December 7 in Dearborn, MI, for its first annual meeting and reviewed the cooperative progress made by growers. Some called it unprecedented in the North American industry.
Grower successes marked at the confab, held in connection with the National Potato Council's seed seminar and the United States Potato Board's Outlook Summit, recognized the group's achievement in raising fresh potato prices.
UNITED America, organized just nine months ago, has done more than ever before in the North American potato industry to help growers stay solvent..
UNITED was organized to increase prices that would keep growers in business. after dismal pricing received in 2004. Realizing the same situation would probably continue, an acreage reduction program was introduced for 2005.
This resulted in the highest early season storage prices in 10 years. UNITED's voluntary and paid acreage reductions were responsible for more than half the acreage cut experienced in the United States this year.
Canadian growers responded when they saw U.S. growers organizing and initiated their own "buy down" program which added nearly 10,000 acres to the organized cuts made by UNITED of America.
Features of the meeting included strategies for acreage management and supply control for the upcoming '06 crop. UNITED growers are well aware that if they return to normal acreage levels, prices will fall to disasterous levels experienced in recent years.
Another highlight of the meeting was a panel of marketing experts from across the United States and Canada. They discussed the first ever national "'05 pack plan" that the UNITED Marketing Committee developed to estimate the quantiity of potatoes that is available on a monthly basis for the fresh market.
The panel also discussed the need for national sales and marketing consolidation to match the consolidation already happening at the customer level.
UNITED was originally organized to help fresh growers, but soon recognized that the fortunes of all growers, including seed, process and chip growers, are all closely inter-related. To address these needs, the board authorized the formation of committees to explore how these other segments of the industry can also benefit by uniting in common efforts to manage supplies.
UNITED plans to meet with process bargaining groups in January to plan strategy for raising contract prices that are currently too low to cover the cost of production and provide a return on investment to process growers.