Not much can be said about potato processing contracts because four major buyers – McCain, Lamb Weston, Simplot, and Cavendish – are still in negotiations. In Prince Edward Island, for example, the Cavendish contract is in mediation.
“It’s unknown today what potato buyers will project for the next year,” says Kevin MacIsaac, general manager, United Potato Growers of Canada. “Right now, we’re in excess today for processing potatoes. Some will go to fresh market channels. The industry is also looking at potential other end uses.”
The COVID-19 virus has caused governments to shutter restaurants and food service channels, major outlets for French fries. Normally 60 per cent of potatoes are destined for processing. While the demand for fresh potatoes has surged at retail stores, buying patterns are uneven.
“We’ll likely see another bump in fresh sales for the Easter weekend,” says MacIsaac.
While some processing potatoes can be diverted to the fresh market, it must be remembered that they are coming out of storage at warmer temperatures and might exhibit skin-quality issues.
Growers are already receiving and cutting seed potatoes, without knowing if there’s a contract for them for fall 2020.
On the positive side, MacIsaac notes that demand is good for the chip industry.