Record temperatures shrink potato yields but demand remains high

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The latest statistics from Potatoes South Africa (PSA) show dryland and irrigation potato farmers are still dealing with the consequences of the high temperatures accompanying the drought.

Farmers lost 31 million 10kg-bags or 310 000t of fresh, processing and seed potatoes since September 2015.

From January 2016 to August 2016 there was a reduction of 16% or 12,6 million 10kg-bags sold on national fresh produce markets in comparison with the same time last year. As a result, market prices were 81% higher than the same time last year.

According to the Bureau for Food and Agricultural Policy (BFAP) baseline report, the 2016 production decrease caused a 61% rise in nominal market prices.

This means a 10kg-bag of potatoes cost an annual average of R47,20. However, if stable weather conditions return in 2017, the average nominal market price for a 10kg-bag of potatoes should decrease to R31.

Although farmers received significantly higher prices in 2016 compared to 2015, Dr Andre Jooste, PSA CEO, said that, in real terms, prices in 2015 remained similar to those of 2004.

Even though prices increased in 2016, it is still difficult for potato farmers to cope with the rising cost of inputs and for new producers to enter the industry.

“Potatoes are a capital and management intensive crop because they are prone to soil-borne diseases,” said Jooste.

The good news is that potato consumption is expected to increase, according to the BFAP report. Potato demand is projected to expand by 12% to 2,55 million tons by 2025.

In the past decade potato consumption increased from 1,63 million tons in 2005 to 2,27 million tons in 2015.