According to market analyst and editor of North American Potato Market News, Bruce Huffaker, alarmists appear to be exaggerating reports about weakness in demand for frozen potato products. While there is no doubt that the economy has hurt demand, one anonymous report extrapolated a 13% drop in December retail sales (about 10% of total Fry business) into a 20% cut in Pacific North West contract volume for the 2009 crop.
"While reduced imports may be responsible for holding domestic sales steady, we find no evidence to support the reports of such draconian cuts in contract volume,"Mr Huffaker said in last week's issue of NAPMN. Contract volume reductions may approach 8% in the Columbia Basin, he said. Idaho cuts could be less pronounced.
Mr Huffaker expects that areas that have not yet signed 2009 contracts, including Wisconsin, Maine and Canada may see volume increases, as buyers expect to pay much less for potatoes in those areas.
United States: 'Reports about weak demand for frozen potato products exaggerated'
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