Potato demand should pick up in January

12/23/2008 12:00:00 AM
Andy Nelson

(Dec. 23, 12:44 p.m.) Potato grower-shippers expect more of the same strong pricing in the New Year, which should keep retailers from running perilously low on spuds, as they did last summer.

Year-to-date, as of Dec. 10, Rosholt, Wis.-based Bushmans’ Inc. had shipped about 10% fewer potatoes than it had the year before, said Mitch Bushman, president.

“Demand has been just average, maybe even slightly down,” he said. “Both Thanksgiving and Christmas definitely were not as strong as last year.”

Movement has been “tempered,” but by no means sluggish, said Kevin Stanger, senior vice president of sales and marketing for Wada Farms Marketing Group, Idaho Falls, Idaho.

Stanger expected demand to pick up in January, when several big retail ads are expected to break. Despite the lower volumes this season, promotions will continue, and he was optimistic the industry would not see a repeat of last summer’s severe shortage.

Movement of Red River Valley reds had been excellent the first two weeks of December for NoKota Packers Inc., Buxton, N.D., said Steve Tweten, president.

That should change significantly for the last two weeks of the month — but that’s nothing out of the ordinary, with transportation options pinched by the holidays, he said.

“We have the orders, we just can’t get the wheels,” he said.

Lower demand would seem to be counter-intuitive, Bushman said, with more people eating at home because of the recession. That typically helps spud sales.

It could be explained, though, he said, by more consumers switching from 10-pound to 5-pound bags.

“We used to say, ‘the garbage can is one of our best customers,’” he said. “People would use 8 pounds of the 10-pound bag, then throw the other two away. Now they’re buying the 5-pound bag and using all of them.”

Despite the slower movement, Bushmans’ actually has about the same amount of potatoes in storage as it did last year at this time, Bushman said.

And to avoid last year’s scant summer supply situation, markets will likely stay steady for the foreseeable future, to prevent the movement of too many potatoes, too fast, he said.

“With the stocks on hand, I don’t see the price eroding much further,” he said. “We know what happened last year. I’d hate to disappoint customers two years in a row.”

Tweten said stocks were “right where we expect them to be,” and, like Bushman, he expected strong pricing to remain the norm in 2009.

In mid-December, Bushmans’ had ample supplies of all varieties except for whites, which the company was a little short on, Bushman said.


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