Polish Potato Processing Industry Affected by Lower Domestic and the EU Production

The poor harvest and a shortage of potatoes in Poland and the EU negatively impacted the potato processing industry, according to Tridge Engagement Manager in Poland, Kuba Fingas. Most producers of potato starch and fries only have enough products to supply current clients and virtually nothing left over for new customers. Though most important, drought and high temperatures were not the only reason for decreased production. Reduced acreage of potato cultivation in Poland, which has been falling for years, culminated this year in what seems to be a difficult situation for the potato processing industry in Poland, which is left with only 70% capacity occupancy at the moment.

Depending on the official data from the Agency for Restructuring and Modernization of Agriculture (ARiMR) and the Central Statistical Office in Poland, potato acreage varies from 184,000 to 200,000 ha. Differences coincide from unrecognized cultivation areas from smaller plantations (less than 2 ha), marked as subsistence farming often going under the radar. Nevertheless, the current level of potato production is far from the 300,000 ha cultivated in 2019 and 350,000 ha in 2013.

The main reason for the decrease in potato areas in Poland was small farmers' switch to more profitable crops, such as cereals and other vegetable crops. Pressured by increased production costs and low prices and incentives, only large farmers who modernized potato production prevailed. Larger farms have invested in quality seed material, irrigation systems (a necessity in CY 2022), and professional crop protection of potatoes. Still, the issue of the availability of plant protection products remains the main concern for farmers due to the ever-stricter EU policy of limiting active substances. For example, at the moment, there is no means of treatment against wireworm larvae which damage seed pieces and young root systems during plant establishment, resulting in poor stands. More commonly, the damage is seen as shallow to deep holes in the potatoes caused by wireworms burrowing into the tuber while feeding.

Production of Potatoes, Including Seed Potatoes in the EU Member States in 2020

Source: Eurostat

Poland ranks second in potato production (16.4%) in the European Union, according to data by Eurostat. Germany is the EU’s largest producer (21.2%), and the third position is held by France - 15.7%.

Share of Export Destinations for Potatoes from Poland

Source: Tridge

Despite being the EU's second-largest producer of potatoes, Poland exports are minimal to EU countries due to problems related to phytosanitary safety (occurrence of ring rot). The bacterium Clavibacter michiganensis subsp. sepedonicus causes ring rot, making potatoes unfit for export to other EU countries.

The Russia-Ukraine war has further complicated the export of potatoes and value-added potato products. With lower production and limited options for export, the starch industry suffers, and the unattractive price plays the leading role. On stock exchanges, link here, and wholesale markets (Tridge price data), the cost of edible potatoes is around USD 219/mt, reaching USD 262m/t. In the case of a starch potato, it is USD 87-98/mt. Besides being consumed directly and traded as a raw commodity, potatoes are processed into four main types of product: frozen potatoes, dried potatoes, prepared or preserved potatoes, and potato starch. Starch potatoes tend to be long in shape with coarse skin with the following varieties: Russet (the most used for French fries), Goldrush, Long white, etc. Farmers originally planted the potatoes for the starch industry, but given the price difference, often starch potatoes are sold by producers as edible. The potato starch industry in Poland has started offering higher purchase prices. As a result, buyers must decide whether to pay the suggested price or go without the product altogether.