The North-western European Potato growers (NEPG) responds to the price drop of free buy potatoes (non-contracted potatoes)and the negative signal this sends to the growers.
North-western European Potato growers (NEPG) concerned about price drop of free buy potatoes and negative signal to growers.
During the last weeks, free buy prices (prices for non-contracted potatoes) from different North-western European quotations have seen dramatic declines, no longer allowing to cover production costs.
The North-western European Potato growers (NEPG) stresses that even if there is a logical link between supply and demand – the current very low demand for not contracted potatoes is due to much larger contracted volumes and and a high supply of potatoes unsuitable for storage - there also must be a logic between quotations and real exchanged volumes.
In the virtual absence of demand real free buy volumes are currently very low, leading to indicative quotations in a very narrow market.
Producers must take all necessary precautions when considering these quotations, and not succumb to "panic", as the market fundamentals remain robust over the long term of the campaign... hence the importance of storage.
The NEPG reminds that the needs of the European processing industry for future months should be of an additional 2 million tons compared to the one of 2 years ago and future price perspectives are good.
Moreover, the current very low free buy prices are not an incentive for growers who need to be reassured for future plantings which will be done in an ever more difficult context.
Additional economical, legislative and technical and climate change constraints make potato cultivation increasingly risky and difficult. Each stakeholder in the European potato industry should take into account all of this information if their goal is to maintain the momentum of their supply for the next campaign.
The North-western European Potato growers (NEPG) stresses that even if there is a logical link between supply and demand – the current very low demand for not contracted potatoes is due to much larger contracted volumes and and a high supply of potatoes unsuitable for storage - there also must be a logic between quotations and real exchanged volumes.
In the virtual absence of demand real free buy volumes are currently very low, leading to indicative quotations in a very narrow market.
Producers must take all necessary precautions when considering these quotations, and not succumb to "panic", as the market fundamentals remain robust over the long term of the campaign... hence the importance of storage.
The NEPG reminds that the needs of the European processing industry for future months should be of an additional 2 million tons compared to the one of 2 years ago and future price perspectives are good.
Moreover, the current very low free buy prices are not an incentive for growers who need to be reassured for future plantings which will be done in an ever more difficult context.
Additional economical, legislative and technical and climate change constraints make potato cultivation increasingly risky and difficult. Each stakeholder in the European potato industry should take into account all of this information if their goal is to maintain the momentum of their supply for the next campaign.
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North-western European Potato Growers (NEPG)
