Potato prices keep rising in Northwest Europe

For the fourth consecutive year, potato prices in Northwest Europe, including the Netherlands, Belgium, France, and Germany, remain above average. This also applies to processed products such as fries and crisps. The ongoing rise in prices is influenced by various factors. Rabobank lists them.

Four seasons of rising prices

Despite the decline in prices for grains and oilseeds since their peak in 2022, potato prices in the 2023/24 season remain high. Contract prices for consumption potatoes that go to the processing industry have also increased. These are estimated to be about 70 percent higher in 2024 than four years earlier. The demand for processed potato products remains strong, while various limitations exist on the supply side. The costs and risks for potato farmers have increased and will likely be reflected in the prices.

Increasing demand for processed products

The demand for fries and crisps in Northwest Europe continues to grow, partly due to the expansion of the processing capacity of the potato processing industry. Particularly in the north of France, there is an expansion of this capacity. The demand for these products is expected to continue to increase in the coming years, mainly due to growth in emerging markets. This contributes to the pressure on available potato stocks.

Market recovery after the coronavirus pandemic

After a temporary decrease during the coronavirus pandemic, the market for frozen fries quickly recovered. By the end of 2021, global imports had returned to pre-pandemic levels. Belgium has strengthened its position as the world's largest exporter of frozen fries. The global demand for frozen potato products continues to increase, with an average growth of about 3 percent per year.

This ongoing strong demand has led to steady growth in the European demand for crisps, which is expected to continue over the next five years. The international trade in these products continues to grow, underscoring the need for a larger supply of potatoes. The production costs for processed potatoes have mainly increased due to the higher prices of the potatoes themselves and increased costs for energy, transportation, and packaging.

Rabobank.nl