"Why do I never plant enough potatoes when the market is great?" This is a common question asked by nearly every grower, and most likely the grower's spouse, when grower returns to the farm are high.
Growers achieved positive returns recently for two primary reasons. The first is growers planted the appropriate amount of acres for market demand, assuming yields approached expected levels. The second is that yields were well below trend line levels for the past two seasons.
United Potato Growers of America and the Potato Marketing Association of North America each provide a forum for member growers to debate and ultimately understand the needs of the market for the coming year. Ultimately, though, it is the decision by each and every individual grower that determines whether there are too many or too few acres planted. Growers have proven to have a much better understanding of these market forces this past year as the urge to overplant was overcome, unlike in 2009.
A closer look at markets for last year and this year indicates that there were more than enough acres of potatoes planted to meet the needs of the market if yields were normal. Emergence in many storage regions was two weeks later than the five-year average in both 2010 and 2011, even though growers planted more potatoes for early harvest this year. If production had achieved trend line yields in either of the least two years, returns to the farms would have been much lower and supplies much more plentiful. In fact, it is highly probable that processors would have been selling potatoes into the fresh market rather than purchasing potatoes from the fresh sector.
As growers begin to make preliminary plans for the 2012 season, a grower needs to think about what supply and demand may hold for the 2012-13 marketing and processing season.
Acreage in 2011 met or exceeded the 2009 acreage levels in many regions. Do growers really want to bet on a third year of late emergence and below trend line yields just to have a chance to break-even if acreage levels remain the same this year? Were you able to market your crop with no issues in late September and early October as fresh volumes returned to more average levels? Do you think the market will be better with significantly more volume in that period and the rest of the year in 2012--13? With the USPB recently reporting that domestic demand for frozen potatoes declined by more than 3 percent compared to the previous year, will the frozen potato processors continue to need so much extra product for next year?
Potato growers have had an excellent run of success by having better market analysis tools available to help guide their planting decisions. Continued trust in United and PMANA can help members sustain their operations while meeting the needs of the consumer.