Challenges and opportunities for potato company HZPC in China

Challenges and opportunitiesfor HZPC in China

Challenges and opportunities for HZPC in China

Febrero 28, 2023
Exceptional weather conditions, strict corona measures and political elections. Potato company HZPC has been involved in China since the beginning of this century, but as in the Netherlands, every year is different.

Ton Frijters is active in China on behalf of HZPC. He has visited many growers in recent years, experienced the corona measures himself and is already looking ahead to 2023. The demand for HZPC varieties is only increasing.

At around 4,000 linear kilometres in length and breadth, China is huge. Images we see of the country are often impressions of big cities, for instance during events such as the Olympics, but inland, they grow potatoes. Ton Frijters has been pioneering in China for 15 years on behalf of HZPC although pioneering is no longer the appropriate word.

Ton Frijters:
 
"HZPC is becoming a household name in China; it has built a good image. Mostly thanks to the quality of the varieties. Initially in the fries industry with the Innovator and later the Ivory Russet, but now also in the fresh market, with varieties such as Colomba and Lucinda."
Growth of Ivory Russet

Ton Frijters:
 
"HZPC is the first foreign breeder to really invest in the country. This started in 2007 when major fast-food chains applied their global standard (level of quality) in China as well. They are used to white-fleshed potatoes here, so demand is growing for the Ivory Russet as a replacement for the Russet Burbank because the Chinese growing season is too short for this old variety."
Ivory Russet initially had a difficult start, but when the variety was grown under specific growing conditions in larger fields, its added value soon became apparent. Slowly but surely, the Shepody and Russet Burbank varieties are being replaced by Innovator and Ivory Russet. Most of the potatoes used by the fries industry (fast-food chains) are now Innovator and, increasingly, the Ivory Russet.

Only 1% of the market

The fries industry in China is large and growing faster than fries industries in the rest of the world. Nevertheless, it is still small compared to the Chinese fresh food market.

Ton Frijters:
 
"To give you an idea: the fries industry is only 1% of the market. The rest is fresh."
Inland, small restaurants play a big role in this market because the Chinese hardly ever eat at home.

Potatoes are traded on large wholesale markets. Here you can see that demand is shifting. Traders want to stand out and do so via appearance or by washing potatoes. So, it helps when the washed potatoes look good, like Lucinda and Colomba. They also sometimes play clever tricks to make the potatoes look fresher.

For example, potatoes from the south (winter crop), which are recognisable due to the southern red earth sticking to the tubers, are popular in spring. Traders from the north therefore ‘wash’ their older potatoes in red earth, making them seem more attractive.

Hiding potatoes

The government promotes potatoes as food. Potatoes yield the most nutrients per square metre of land and require less water than, say, wheat or rice. In China, however, potatoes are not seen as the basis for a meal, as in Europe. Chinese consider potatoes to be vegetables. To encourage the population to eat more potatoes, people hide them in dishes, such as in wok dishes with noodles or using potato flakes.

China is an exceptional country. There’s a lot going on. Developments follow on from one another at lightning speed. You need to see it to believe it.

Corona in China

The small restaurant market has taken a huge hit recently due to coronavirus measures. The many lockdowns and quarantine measures made restaurant visits impossible and many small restaurants closed due to lack of customers. However, Ton expects the smaller restaurants to be up and running again soon, now that the corona measures have been abruptly relaxed.

People’s freedom of movement has been restricted by government policies to combat corona for years. This has not gone unnoticed among growers and producers. They, too, were expected to work from home as much as possible and at manufacturing companies, people worked and lived at the factory for months at a time, in a so-called closed loop.

And, despite the importance of potatoes, potato shipments were stopped at domestic border crossings for fear of contamination if they came from an area where corona had been detected.

Ton Frijters:
 
"There is low level of vaccination but they trust that the government has their best interests at heart. And make no mistake about it, China has experienced enormous growth in recent decades and poverty has decreased tremendously. Thanks in part to government policy."
Ton has been in China less often than before due to corona measures. He used to spend two weeks per month in China and two in the Netherlands but, during the pandemic, he visited China just twice a year for two months.

Ton Frijters:
 
"It became increasingly difficult for me to work there. The Chinese government’s zero-tolerance policy created too many restrictions. Last year things got a bit crazy; I was in quarantine for a total of 52 days."
The demand for HZPC varieties is ever-increasing.

Call for stronger varieties

In recent times, people have been demanding a relaxation of the measures. Ton expects this to happen soon and is already looking ahead. The demand for more robust varieties will also increase here. It is clear that yields of HZPC varieties are higher than local varieties and that these varieties are resistant to various weather conditions.

This is vital because there were challenging weather conditions in China last season. In northern growing areas, they experienced a long cold spell at the beginning of the year, fields were flooded by heavy rainfall in July and then beset by heavy night frosts at the end of August. All in all, this resulted in 20-30% lower yields.

How things will pan out in China next year is not yet known. It will largely depend on the new frameworks set by the government. In October 2022, the ruling party sets the policy that will be turned into government policy next year.

Once this is clear, they will know how to work with local partners and governments to re-establish new import lines so that they can provide Chinese growers with new topquality disease-free plants, because seed potatoes cannot be imported.

One-generation seed potato growing

Once import lines are in place, new varieties can be introduced smoothly in China.

Ton Frijters:
 
"Because mini tubers are so cheap, people only grow one generation of seed potatoes for consumption. China is an exceptional country. There’s a lot going on. Developments follow on from one another at lightning speed. You have to see it to believe it."