Last season for potatoes was generous. Then the yield exceeded the expectations of farmers. Now it is still too early to talk about the results of this year’s harvest, since at least 30% of the sown areas need to be processed for this.
At the same time, harvesting has already begun and farmers predict that this year the indicator may decrease by 10%.
“It is not very correct to compare the seasons, but we can say that the yield rate of 2022 will decrease by approximately 10%. The main factor of influence is insufficient moisture supply, which is observed this year,” says Orest Kravchuk, head of the “Potato” cluster of the Continental Farmers Group.
If by the middle of April there were good indicators of moisture conservation, then the crops of the later period already did not receive the required volume.
At the same time, a drop in temperature is expected in Ukraine after October 10, and such an indicator is critical for potato chips, as it affects the indicator of sugar content. Therefore, considering this factor, farmers first of all dig potato varieties, leaving table potatoes, which are not so sensitive to the cold, for a later period.
Another problem this year is the reduction of processing capacities, the work of which was stopped due to military operations.
In general, experts note that the potato market in Ukraine is stable. Despite the war, destroyed agricultural machinery and infrastructure, farmers can cover domestic demand. At the same time, it should be taken into account that millions of people left Ukraine, so the demand for potatoes will decrease.
Europe: shortages and rising prices
In Europe, the situation with potatoes is completely different. A severe drought will lead to the worst potato harvest in recent years. The largest potato production in Europe is concentrated in Germany, France, the Netherlands and Belgium. Drought in these countries will reduce EU production to the lowest level on record.
Producers of potato products (such as French fries) have already raised prices due to rising energy costs, and a poor crop this year will push prices up even further. For example, the McDonald’s restaurant chain raised prices in Europe due to higher prices of raw materials.
Analyst of the Ukrainian Agrarian Business Club (UKAB) Svitlana Lytvyn believes that this year there will be no need to import potatoes, except for seed potatoes. After all, since the beginning of the war, the cost of logistics of imported goods has increased significantly, and the hryvnia exchange rate has increased.
Before that, Ukraine had already refused to import Belarusian and Russian potatoes, which will also stimulate the sale of Ukrainian products on the domestic market.
How much will potatoes cost?
At the beginning of September, a downward trend in prices was established in Ukraine. For example, as of mid-September, potatoes are sold at 4-6 hryvnias per kg at the “Shuvar” market in Lviv, and at 7-9 hryvnias per kg at the “Stolichny” market in Kyiv.
The projected price of potatoes for consumers this fall is about 7-8 hryvnias per kilogram, says Orest Kravchuk.
“Producers do not expect high prices this season. There are enough products on the market. There are certain changes in the traditional sources of income: this season, part of the potatoes will come from the private sector, and not from producers engaged in cultivation on an industrial scale. This is due to the fact that in the regions where hostilities took place or are still taking place, producers could not conduct economic activities at full capacity,” Kravchuk emphasizes.
Svitlana Lytvyn added that the Ukrainian potato market is characterized by a high share of production in households. People grow potatoes on their homesteads to meet their needs. The share of such production is 98%. And only 2% of potato production is occupied by farms and industrial enterprises, which then sell these products.
At the same time, it should be noted that since the beginning of the war, product prices have increased by 20%. Experts of the All-Ukrainian Agrarian Council (VAR) say that during the harvest, the price of vegetables decreases due to a large supply, but the costs of storing vegetables have been increasing since October, so we should expect a 10-15% increase in the price of all vegetables, including number of potatoes.