Idaho potato growers at a Monday meeting in Burley approved processing contracts with J.R. Simplot and McCain Foods that both include payment increases averaging 1.6 percent.
Growers had previously approved a contract with Lamb Weston, which also includes a 1.6 percent average payment increase.
"The majority of growers supported the position the processors have taken, I think with the understanding that it's going to result in a reduced margin for us to grow a quality product if we have expansions we anticipate for zebra chip (programs)," said Dan Hargraves, executive director of Southern Idaho Potato Cooperative, which represents Idaho growers in negotiations with processors.
Hargraves said processors are concerned about the combination of flat demand and overproduction of potatoes in the 2012 crop year.
"We're willing to do our part to make this thing work," Hargraves said.
SOURCE: John O'Connell, Capital Press
http://www.capitalpress.com/newsletter/JO-ProcessContractsApproved-030413