Potato market running hot with holiday demand, shorter crop

Strong demand and higher pricing characterized the potato market in early November, and tight market conditions are expected to continue through the holidays.

Thanksgiving demand in early November was adding upward pressure to the market, according to the Markon Fresh Crop Report for the week of Nov. 6. The expectation is that active prices for russet potatoes will continue for several weeks, the report said. 

Lower acreage for fresh market potatoes in Idaho this year, combined with active demand from frozen potato processors, have contributed to higher pricing for this year’s crop, industry observers say.

Weekly shipments of Idaho potatoes totaled 1.06 million 50-pound cartons for the week of Oct. 23-29, down 7% from the same week a year ago. Season-to-date shipments of Idaho potatoes through Oct. 29 totaled 10.7 million 50-pound cartons, down 10% from the same time a year ago.

Elevated pricing at both the farm level and at retail are expected in a short crop year, said Craig Carlson, president of Chicago-based Carlson Produce Consulting.

"If I was a retailer, as long as I'm paying the same as everybody else, then I have to take up my prices," he said. Some retailers may try to promote smaller pack sizes to lessen the sticker shock for consumers, such as promoting a 3-pound bag instead of 5-pound or 10-pound bags, he said.

With inflated retail potato prices, the store might lose a little bit of tonnage but will make up for it with increased per-unit pricing, he said. “With the gross profit margin percentage, you are still going to be fine," he said. 

Potatoes are staple foods for consumers eating at home, which plays well into the trend of people going out to restaurants less with the slowing economy, Carlson said. "Even though the price is up on a per pound basis, it is actually a very, very inexpensive product.”

Climbing higher

Shipping point pricing for Idaho russet norkotah potatoes on Nov. 2 reflected markets that were double the same time last year, according to USDA pricing.

The USDA reported 50-pound cartons of russet norkotah potatoes were priced at $30-$33 fob for 40-count cartons on Nov.2, up from $13-$15 per carton at the same time in 2021 and nearly triple $10-$14 per carton for the same date in 2020.

Size 100-count cartons of russet norkotah potatoes from Idaho were priced at $16-$17 per carton on Nov. 2, up from $12-$13 per carton a year ago and about double the $6.50-$8 per carton reported two years ago. 

Cartons of 10 5-pound film bags of Idaho russet norkotahs were $12-$13 fob on Nov. 2 this year, up from $8.50-$9.50 a year ago and $7-$8 per carton two years ago.

Retail riding high

Retail advertised prices for potatoes have jumped substantially in the past year, according to USDA statistics.

For the week of Oct. 28, the USDA said advertised retail prices for potatoes averaged $1.60 per pound, up 20% from $1.33 per pound the same week last year. What's more, the number of retail stores promoting potatoes is down compared with a year ago. The USDA said 26,536 supermarkets promoted potatoes on Oct. 28, down 10% in number compared with a year ago.

Average U.S. Retail Potato Price 
Date        Retail average promoted price    Number of stores promoting

• 8/6/2021     $1.21      17,320 
• 8/13/2021     $1.19      15,226 
• 8/20/2021     $1.12      20,404 
• 8/27/2021     $1.20      24,228 
• 9/3/2021     $1.17      24,724 
• 9/10/2021     $1.19      24,000 
• 9/17/2021     $1.13      27,174 
• 9/24/2021     $1.24      25,408 
• 10/1/2021     $1.29      37,210 
• 10/8/2021     $1.26      21,578 
• 10/15/2021     $1.17      28,316 
• 10/22/2021     $1.11      28,988 
• 10/29/2021     $1.33      29,322 
• 11/5/2021     $1.32      33,044 
• 11/12/2021     $1.29      35,776 
• 11/19/2021     $1.40      34,122 
• 11/26/2021     $1.40      30,574 
• 12/3/2021     $1.25      25,808 
• 12/10/2021     $1.34      28,572 
• 12/17/2021     $1.35      47,646 
• 12/24/2021     $1.28      39,198 
• 12/31/2021     $1.21      27,816 
• 1/7/2022     $1.38      19,668 
• 1/14/2022     $1.22      39,572 
• 1/21/2022     $1.45      27,860 
• 1/28/2022     $1.39      28,556 
• 2/4/2022     $1.50      25,534 
• 2/11/2022     $1.44      29,164 
• 2/18/2022     $1.46      39,684 
• 2/25/2022     $1.49      34,028 
• 3/4/2022     $1.26      24,998 
• 3/11/2022     $1.29      49,894 
• 3/18/2022     $1.32      28,184 
• 3/25/2022     $1.33      20,904 
• 4/1/2022     $1.43      24,682 
• 4/8/2022     $1.32      19,722 
• 4/15/2022     $1.46      36,814 
• 4/22/2022     $1.43      23,998 
• 4/29/2022     $1.32      20,546 
• 5/6/2022     $1.54      26,002 
• 5/13/2022     $1.18      19,092 
• 5/20/2022     $1.26      20,762 
• 5/27/2022     $1.45      16,502 
• 6/3/2022     $1.23      18,734 
• 6/10/2022     $1.34      18,014 
• 6/17/2022     $1.34      17,818 
• 6/24/2022     $1.31      9,824 
• 7/1/2022     $1.50      16,030 
• 7/8/2022     $1.46      9,038 
• 7/15/2022     $1.35      9,216 
• 7/22/2022     $1.34      3,832 
• 7/29/2022     $1.52      4,384 
• 8/5/2022     $1.39      6,980 
• 8/12/2022     $1.46      7,888 
• 8/19/2022     $1.46      6,252 
• 8/26/2022     $1.62      6,546 
• 9/2/2022     $1.62      11,720 
• 9/9/2022     $1.54      14,066 
• 9/16/2022     $1.62      14,356 
• 9/23/2022     $1.50      17,384 
• 9/30/2022     $1.57      22,682 
• 10/7/2022     $1.47      17,950 
• 10/14/2022     $1.50      19,872 
• 10/21/2022     $1.57      27,034 
• 10/28/2022     $1.60      26,536 

Source: USDA