( Photo and logo courtesy Potatoes USA; graphic by Amelia Freidline )

DENVER, Colo. — The 2020 annual meeting of Potatoes USA proceeded as planned even as news was breaking that the NCAA decided to exclude fans from its annual post-season basketball tournament the coronavirus, COVID-19.

While a handful of Potatoes USA board members chose not to make the trip for the March 11-13 meeting, Blair Richardson, president and CEO of Potatoes USA, said the event was broadcast over the web.

Some potato marketers said that sales of dehydrated potato flakes have increased while foodservice fresh and frozen sales have dropped. Most said they don’t expect long-term changes in how people buy potatoes.

Anxious consumers

 

The “anxiety economy” existed before both the coronavirus and the escalation of the 2020 presidential race, said John Toaspern, chief marketing officer for Potatoes USA. Toaspern spoke March 11 at the annual meeting.

“People are nervous; they aren’t really sure what to do,” he said.

Millennials are delaying having children because they are concerned about the future, he said.

In the end, Toaspern said the coronavirus will eventually give way to long-term trends. As people look for a “silver bullet” way to eat, Toaspern said diet preferences such as paleo, keto, sugar-free, functional foods, and vegan may persist.

Promoting the value of potatoes as a performance food is a message that resonates with consumers he said. Food waste and sustainability will be hot-button issues for consumers in coming years, he said.

Despite the current alarm about gathering in public places related to coronavirus, Toaspern said the long-term trend for consumers is to eat out more.

“The shift to away-from-home eating continues to occur,” Toaspern said, noting that the 2020 estimate for total foodservice sales growth is 3.9%. “That forecast was certainly made before COVID-19 occurred but I still think we will see growth once you factor in all aspects,” he said.

Home delivery of restaurant food counts as foodservice sales, and Toaspern said that is booming now with the current fear of coronavirus.

“People might be scared to go out and eat but they are happy to have food brought to them,” he said. In 2019, foodservice delivery grew 59%, and accounted for 38% of foodservice sales.

Brighter year

 

2019 was a brighter year for the industry, he said. Total U.S. potato utilization in 2019 was up 37.01 billion pounds up 3.3% compared with 2018, he said.

Retail potato (all forms) utilization totaled 14.8 billion pounds, up 0.7% for the year.

Foodservice utilization totaled 20.59 million cwt., which was up 1.2% compared with 2018. Exports of 7.58 billion were up 8.8% compared with 2018, while U.S. potato imports of 5.97 billion pounds were down 3.4%.

“The 3% increase in year-over-year utilization is the best number we’ve ever had since we started doing this,” he said.

Utilization by type of potato in 2019 totaled 41% frozen, 25% fresh, 21% chips, 8% dehydrated and 4% refrigerated.

Eighty-five percent of frozen potatoes are sold in foodservice channels and the rest are sold at retail outlets. 

For fresh potatoes, Toaspern said retail sales account for 52% of the total fresh sales, and foodservice accounted for the rest.

Retail fresh potato sales totaled 4.58 billion pounds in 2019, down 1% from 2018.

At foodservice, statistics for 2019 show fresh sales were 4.29 billion pounds, down 1.8% from 2018.

Sales gains were noted at retail for chips, dehydrated and refrigerated potatoes. 

In the foodservice sector, Toaspern said that frozen and refrigerated potato sales increased in 2019, while decreases were noted for chips and dehydrated potatoes.

Over the past three years, fresh sales at retail have decreased an average of 2.1% per year, while frozen potato sales have grown an average of 3.1% over the past three years.

The three year-trend line for fresh potatoes at foodservice shows sales have decreased 0.7% per year in that time frame. By way of comparison, frozen potato sales at foodservice during the past three years have increased an average 0.9% per year.

Export sales represent a strong opportunity for sales growth for potatoes, with sales in recent years growing from 6% to 8% per year.

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Promising trade gains, U.S. signs phase one trade agreement with China

 
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