1. Weekly News

Europe

Europe's Potato Production Decline Forecasted at 9% YoY Due to Climate Change

European potato farmers faced significant challenges in 2024, including limited seed potato supply, higher prices, and adverse weather conditions. Heavy rainfall during the planting and summer seasons has delayed planting and harvesting, with some regions experiencing extended planting periods and increased blight pressure. Climate change aggravates these issues, with an intensifying hydrological cycle leading to more extreme rainfall and flood risks. As a result, European potato production is forecasted to decline by nearly 9% year-on-year (YoY) in 2024. Farmers are reducing planted areas due to the high risks involved, and concerns over food security are rising globally, with disruptions in potato production potentially leading to higher food prices, as seen in the United States (US) potato chip market.

Brazil

Southwest São Paulo Potato Harvest Faces Challenges

By the end of Nov-24, Brazil's Southwest São Paulo had completed 95% of its winter potato harvest, with the remaining 5% expected in Dec-24. The region follows a planting schedule from May-24 to Aug-24, with harvest starting in Sep-24 and divided into dry and winter phases. Whitefly infestations impacted both phases, while black spot and blackleg were under control. Mild winter temperatures improved productivity, but scarce rainfall in Sep-24 and Oct-24 increased irrigation needs. In Nov-24, increased rainfall caused harvesting difficulties and a rise in diseases like Pythium. This slightly reduced potato skin quality and productivity, averaging 43 to 45 metric tons (mt) per hectare (ha) in the previous months.

Kazakhstan

Kazakhstan Potato Exports Reached USD 53.7 Million in 2023/24

From Sep-23 to Aug-24, Kazakhstan's potato exports generated USD 53.7 million. Commercial potato exports totaled USD 42.7 million, with Uzbekistan being the largest buyer, purchasing Kazakh potatoes worth USD 37.4 million. Kazakhstan also exported seed potatoes for USD 11 million, with Turkmenistan being the sole buyer of seed potatoes, buying them for USD 11 million and an additional USD 0.4 million worth of commodity potatoes.

Other notable export destinations for Kazakhstan's potatoes in the 2023/24 season included Tajikistan at USD 4.5 million and Russia at USD 0.4 million. Comparatively, in the 2022/23 season, Kazakhstan exported commercial potatoes worth USD 27.1 million, with Uzbekistan again being the primary market, purchasing USD 24.4 million. Seed potato exports in 2022/23 amounted to USD 1.2 million, with Uzbekistan purchasing USD 1.1 million. This indicates a significant increase in Kazakhstan's potato exports in the 2023/24 season.

Russia

Russian Potato Prices Surged 2.6 Times in 2024

According to the association, Russian wholesale potato prices increased 2.6 times since the beginning of 2024. In W48, wholesale prices reached USD 0.26 per kilogram (kg), while retail prices have risen 1.8 times to USD 0.52/kg. Several factors have contributed to this price growth. Firstly, a record harvest and a low price base from the previous year, when producers' selling prices were at cost price due to rising expenses for loans, fuel, logistics, labor, and the purchase and maintenance of special equipment (such as combined harvesters and cultivators), have played a role. Leonov, an expert, also pointed out that the low profitability of potato production in the previous year led to a reduction of 20 thousand ha of planted areas in the current season. Despite low prices from Sep-23 until mid-May-24, which benefited buyers, the financial strain on farmers reduced their motivation to grow potatoes this season, further impacting supply and contributing to the price increase.

2. Weekly Pricing

Weekly Potato Pricing Important Exporters (USD/kg)

Yearly Change in Potato Pricing Important Exporters (W48 2023 to W48 2024)

France

In W48, wholesale potato prices in France remained stable week-on-week (WoW) at USD 0.38/kg but rose by 2.70% month-on-month (MoM). This increase can be due to several factors, including rising production costs, declining yields, and challenges like climate change, wireworms, and chemical bans. These issues led to the loss of 11 thousand hectares of potato cultivation in the latest season. Moreover, heavy rainfall during the harvest season reduced yields and caused large quantities of potatoes to be discarded. With 97% of the harvest completed from a record 177 thousand ha, France's potato supply was further constrained, tightening the market.

Netherlands

In W48, wholesale potato prices in the Netherlands remained stable WoW but dropped by 10.53% MoM and 27.38% YoY, reaching USD 0.17/kg. This year's European potato season has challenged farmers, starting with an insufficient seed supply that increased prices. The situation worsened with heavy rainfall, which delayed both planting and harvesting. Research indicates climate change exacerbates the hydrological cycle, leading to more extreme rain and increased flood risks. The European potato sector is projected to see nearly a 9% YoY production decline, with the Southern Netherlands particularly affected by extended rainfall that lengthened the planting season beyond the usual 10 weeks.

Germany

In W48, wholesale potato prices in Germany dropped by 22.22% WoW and MoM and 32.83% YoY, reaching USD 0.49/kg. A bumper harvest of 12.7 million metric tons (mmt) in 2024 contributed to this price decline, marking a 9% YoY increase and 17% above the five-year average. This surplus, supported by a 9% expansion in planting areas, is expected to lower prices, particularly for smaller sack sizes. Despite challenges like late diseases linked to weather conditions, the harvest is significantly larger than last year's. However, potato consumption in Germany has decreased by 28% since 1990, with consumers increasingly shifting towards rice and pasta.

Pakistan

Potato prices in Pakistan rose to USD 0.43/kg in W48, reflecting a 4.88% WoW and a 36.60% YoY increase. This sharp escalation is due to anticipated production challenges in Punjab, the country's primary potato-growing region, which accounts for a significant share of the annual 8.3 mmt production. The impact of smog and fog, exacerbated by climate change, is critical in reducing crop yields and quality. Experts from the Potato Research Institute and Potato Research Station have highlighted risks such as late blight and blackleg disease, which thrive in these adverse conditions. These diseases will likely worsen production deficits, compounding upward pressure on prices. The Pakistan Horticulture Development & Export Company (PHDEC) efforts, such as educational webinars, aim to mitigate these effects through awareness and recommended practices. However, supply constraints may persist without effective implementation, driving further price volatility.

Egypt

In W48, Egypt's wholesale potato prices dropped significantly by 18.52% WoW, 24.14% MoM, and 40.93% YoY, reaching USD 0.22/kg. This decline is due to an increased supply as the winter season begins and new crops come into production. The market is seeing abundant potato production, and prices are expected to continue to fall as more winter crops enter. This drop follows a sharp price increase in Aug-24 and Sep-24. Additionally, economic challenges, including high inflation, currency depreciation, and a prolonged shortage of US dollars, have hindered the import of essential potato seeds, further exacerbating the situation. Yields have also decreased, dropping from 14-16 metric tons (mt) per acre in 2023 to 9-12 mt per acre in 2024.

3. Actionable Recommendations

Strengthen Potato Storage and Cold Chain Infrastructure

European farmers should collaborate with logistics companies and government agencies to develop or expand potato storage and cold chain infrastructure. This would be especially valuable during times of excess supply or adverse harvesting conditions, where cold storage facilities can help extend the shelf life of potatoes and reduce losses. Cold chain logistics could ensure that potatoes are transported efficiently from the harvest regions to markets, preserving quality and reducing wastage. In areas where heavy rainfall and other extreme weather events have caused delays in harvesting, this infrastructure will help maintain a steady supply to prevent price spikes and shortages.

Diversify Seed Potato Sourcing and Develop Resistant Varieties

The ongoing challenges with seed potato shortages highlight the importance of diversifying seed potato sourcing channels. Governments and agricultural organizations should work with private companies and research institutions to increase the availability of high-quality seeds and develop varieties resistant to prevalent diseases, such as blight. This could involve investing in seed production within the EU and partnerships with emerging seed potato markets in regions like Eastern Europe or North Africa, where production costs are lower. Developing more resilient potato varieties, particularly those suited to extreme weather patterns and resistant to pests and diseases, would help mitigate the risk of crop failure and reduce dependency on specific regions for seed supply.

Leverage Private Insurance Solutions for Climate Risks

Farmers in countries with high exposure to climate risks and extreme weather events, such as France, Germany, Poland, and the Netherlands, should prioritize exploring private crop insurance solutions tailored to climate risks. These countries face significant challenges like heavy rainfall, flooding, and temperature extremes, which can lead to yield losses, particularly in potato farming. By investing in private crop insurance, these farmers can protect themselves from the financial strain caused by adverse weather, ensuring long-term stability and resilience in their agricultural operations.

Sources: Kvedomosti, Eastfruit, Portal Do Agronegócio, Nation