Weekly Potato Report

March 17, 2010

From the Michigan Potato Industry Commission

Potato Market Update by Bruce Huffaker

The chip potato market has been relatively quiet during the past week. We did pick up one report of a Michigan open market sale at $1.00 per cwt over the contract. However, most growers do not have any extra potatoes to sell on the open market. The rate of storage breakdown has slowed to the point that chip plants seem to be keeping ahead of the worst problems. Nevertheless, growers and dealers expect to clean up storage potatoes 4-6 weeks earlier than usual, this spring.

USDA reports that the US had 170.1 million cwt of potatoes in storage on March 1. That is 17.4 million cwt more than the industry held at the same time last year, an 11.4% increase. March 1 stocks equate to a record 44.3% of 2009 production. Though numerous areas have more potatoes in storage than they did at this time last year, the biggest surplus issues appear to be in the Columbia Basin and Idaho. Those problems are being exacerbated by weak demand for processing potatoes. Fryers have been using 4%-5% more potatoes than they did the previous year, for the last three months. While that is an improvement on early-season activity, frozen processing demand remains weak by historical standards. The dehy sector presents a more serious problem. Dehydrators used 12.6% fewer potatoes during the previous year. Nevertheless, dehydrators indicate that they are building finished-product inventories.

USDA stocks data for Michigan and Wisconsin appear to be out of line with reality. Michigan stocks were reported to be 3.5 million cwt, up 200,000 cwt from last year. That seems inconsistent with reports that the state's remaining chip potatoes will be cleaned up no later than the middle of May. Wisconsin is reported to have a record 12.0 million cwt of potatoes in storage. However, it has the strongest fresh market of any of the Russet shipping areas. Both fresh and chip potato growers expect to clean up supplies earlier than usual, this spring. The local French Fry plant is not pushing surplus processing potatoes back into the fresh market.

In the fresh market, Michigan packers shipped 62,800 cwt of potatoes during the week ending March 13. That is up from 28,500 cwt a year ago. Last week's shipments were 58.1% Russet potatoes, and 39.6% Round White varieties.

Michigan size A Russets are selling for mostly $1.10-$1.30 per 10# bag, unchanged for the week. In Wisconsin, packers are selling non Size A Russets in 10# bags for mostly $4.50 per 50# bale, also unchanged for the week. Wisconsin 50-70 count cartons are selling for mostly $6.25-$6.50 per 50# box, up from $6.00-$6.25 last week. The weighted average price for Idaho Russet Burbanks advanced to $8.10 per cwt, from $7.90 at the same time last week.

Michigan shippers are selling Round White potatoes for mostly $1.10-$1.20 per 10# bag, unchanged for the week. In Maine, 10/5# bales of 2 inch minimum Round White potatoes are selling for $5.50-$6.50 per bale, also unchanged for the week. Sales of Florida Round White potatoes were insufficient to establish a market this week.

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