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2019 could be a year to remember for potato growers

By: Sean Ellis - Idaho Farm Bureau
Published in Blog on  December 12, 2019

IDAHO FALLS – 2019 could end up being a year that Idaho potato growers talk about for a long time.

“This is going to be a year to remember,” Bruce Huffaker, president of North American Potato Market News, said Dec. 10 during University of Idaho’s “Idaho Ag Outlook Seminar.”

Potato production in Idaho and around the U.S. is down this year and that is translating into significantly higher prices for spud growers.

“There is going to be stiff competition between processors and the fresh market for who’s going to pay the most for potatoes,” Huffaker said.

Potato growers who sell to processors have pre-existing contracts and are locked in to previously agreed upon prices, but farmers who grow potatoes for the fresh market are reaping much higher prices on the open market.

Based on current projections, Idaho potato growers should be making about $12.23 per hundred pounds of potatoes sold right now, Huffaker said. This time last year, they were making closer to $6.

“We’re talking about almost doubling prices for Idaho potatoes this year,” he said. “Not so much process growers but for (fresh) potato growers, it should be a very good year.”

Oakley farmer Randy Hardy, who grows potatoes for the fresh market, said price returns to growers are currently in the $11.50 to $12 per hundredweight (cwt) range.

“Prices are significantly higher right now,” he said.

Hardy, who is 66 and just harvested his 48th potato crop, said, “We haven’t seen this kind of price this time of year in my lifetime.”

St. Anthony farmer Zak Miller, who also grows potatoes for the fresh market, said spud prices typically will peak around springtime.

“I’ve never known spud prices to be this high this time of the year,” said Miller, director of commodities for Idaho Farm Bureau Federation. “It’s quite amazing.”

Based on the United States’ reduced potato crop this year, those strong prices could hold well into next year, industry leaders said.

According to the United States Department of Agriculture, U.S. spud farmers produced a total of 422 million cwt of potatoes in 2019, down 2.2 percent from 2018.

In states with potato processing capacity, production was down 3.6 percent, to 362 million cwt.

Huffaker said there were a slew of weather-related problems this growing season in several potato growing states across the nation and in Canada. That included the slowest start to planting on record in the Columbia Basin and extremely wet conditions in the upper Midwest.

Up to 18,000 acres of potatoes were unharvested in North Dakota and 17,000 acres were unharvested in Manitoba, Canada.

“There were lots of problems with potato crops across North America this year,” Huffaker said.

Canada is projecting its total 2019 potato crop will be up slightly compared with 2018 but that won’t be enough to meet new processing capacity in that country, Huffaker said.

He also said that it’s likely USDA’s potato production total is overstated and doesn’t reflect possible potato storage issues related to the wet weather in the Midwest and a bitter frost in Idaho, which leads the nation in potato production.

That Idaho frost, which hit Oct. 9, came at a time when 10-15 percent of the state’s potato crop was still in the ground. Some fields affected by the severe early season cold sustained 30-40 percent tuber damage, Huffaker said.

According to USDA, Idaho’s 2019 potato crop of 134 million cwt is down 5.5 percent from 2018. Huffaker said that decrease may be understated because many of the frozen potatoes may not be salvageable.

All those production issues in North America have led to a situation where there is stiff competition between processors and the fresh market for raw product, Huffaker said.

That has resulted in significantly higher prices for potato growers that should be more than enough to make up for the losses in potato production that many Idaho farmers sustained, Hardy said.

Potato growers have always known that a small decrease in production leads to an increase in potato prices, he said. “Mother Nature took care of that for us this year.

“For most potato farmers, whatever you lost, you are more than making up for it with the higher prices,” Miller said.

The higher prices are also good news for Idaho’s economy in general. Idaho potato farmers bring in about $900 million in farm cash receipts each year. When potato processing and other spud-supporting businesses are included, potatoes are a multi-billion-dollar industry in Idaho.

Huffaker said the type of heavy freeze damage that Idaho potato farmers suffered this year hasn’t occurred since 1985. But the difference between then and now, he said, is that the whole country had a surplus of potatoes before the 1985 frost hit.  

“This year, the potato supplies were tight before the frost and that’s only going to make supplies even tighter,” he said.

You have to go back to 1964 to find a year remotely similar to 2019 for Idaho’s iconic potato industry, Huffaker said. And that year, “They were the strongest potato prices any one had ever seen (at that time).”

A recent headline from Bloomberg warned, “America braces for possible French fry shortage.”

Huffaker and Hardy both said that’s not going to happen.

“We’re not going to run out of French fries. This headline is way overblown,” Huffaker said.

“The processors figure out a way to get French fries where they need to be,” Hardy said. “They know how to make adjustments to keep their customers satisfied.”

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