The U.S. potato industry, like other commodity sectors, is facing an economic crisis, says Kam Quarles, CEO of the National Potato Council — but the organization is taking steps he hopes will help mitigate that crisis.
The mission of the council is straightforward, he says: “It is standing up for potatoes on Capitol Hill.”
NPC is a national trade association guided by a policy-setting board of 47 growers. It’s supported by a staff based in Washington, D.C.
One of the council’s biggest events of the year, its Washington Summit, concluded in late February.
This year’s summit was scheduled to look at issues like keeping potatoes in federal nutrition programs, promoting free and fair trade agreements and protecting tax policies that support the long-term health of family-owned farming operations.
But one of NPC’s biggest concerns during the current economic crisis is getting a relief package out of USDA and Congress.
A couple of factors have led to the economic challenge for potato growers, Quarles says: a larger-than-average crop that was comparatively more expensive to produce, and more conservative buyers who are reducing their purchases because of the volatile economic landscape.
“It’s creating this kind of perfect economic storm that is engulfing a number of different commodities,” he says.
Financial Impact
Potatoes are the most widely grown vegetable in the U.S., Quarles says.
Assessments have determined that growers of russet potatoes, the most widely grown variety in the U.S., will lose more than half a billion dollars, and growers of all varieties could suffer $780 million in losses, he says.
Quarles thinks USDA and Congress can aid potato growers without having to reinvent the wheel.
COVID-19 sparked “a paradigm shift for the industry” during President Donald Trump’s first administration with the creation of the Coronavirus Food Assistance Program 2, or CFAP2, which delivered direct relief to growers, he says.
That was followed by a similar program last July, the Marketing Assistance for Specialty Crops Program, or MASC.
“Those worked extremely well for growers,” Quarles says.
Money was distributed efficiently, and safeguards were in place to ensure that no one applied for or received funds for which they were not eligible.
“The specialty crop industry today has rallied around a $5 billion number,” he says, adding that the $5 billion figure has been embraced by both House and Senate agriculture leaders.
“I think they recognize that the need is there, and they’re working to deliver that aid,” Quarles says. “The major effort right now is to try to figure out what to attach that package to in order to get it to the president’s desk for signature.”
Beyond the U.S. Border
So far, it seems the current administration’s policies have generally been favorable for potato exports, though they have been somewhat problematic for imported materials.
“When you look at trade policy, even though there’s been a lot of volatility in trade, our export markets really haven’t seen any retaliation against U.S. potato products,” Quarles says.
However, growers who are sourcing fertilizer or crop-protection tools from foreign markets — or if they are building new packing facilities and sourcing foreign steel or equipment — are seeing those costs go up substantially, he says.
Also, securing the southern border has shrunk the supply of farmworkers for labor-dependent U.S. agriculture, Quarles notes.
“That’s clearly driving up costs and creating inefficiencies,” he says.
Quarles remains optimistic about the future of the U.S. potato industry.
“We’re in very difficult economic times right now, but these economic times will pass, assuming that we can get this temporary ‘bridge’ through a package from the federal government,” he says.
