Potato Grower

14 POTATO GROWER | JUNE 2019 Rabobank Potato Map shows growth for northwestern Europe By Stefan van Merrienboer, Rabobank It's a Small World Only a small share of potatoes on the global market is traded internationally. The trade in fresh, seed and frozen processed potatoes made up around 7 percent of total potato production in 2017. Yet growth remains on the horizon. Rabobank's recently released World Potato Map 2019—which can be seen on the following pages—shows that the Northwestern European potato sector benefited most from the growth in global trade during the last decade. During the last decade, developments in the global potato sector were dominated by the consumption growth of frozen processed potatoes. This benefited frozen processed potato producers in the Netherlands and Belgium, who doubled exports between 2007 and 2017. Potato growers in both countries also reaped the fruit of this development through a higher demand for fresh and seed potatoes. Whether the next decade will be as successful as the last depends on how the potato sector in northwestern Europe overcomes challenges regarding soil quality, tightening envi- ronmental standards, volatile price formation and increasing global trade tensions hampering the flow of potatoes around the world. FROZEN TRADE A TALE OF FOUR COUNTRIES The market for frozen processed potatoes has seen tremendous growth over the last 10 years. Since 2007, global trade increased by 3 million metric tons, to more than 7 million metric tons in 2017. Most of this growth took place outside of Europe and North America, with countries in Asia, the Middle East and Latin America leading consumption growth. This increase in consumption is the result of higher disposable incomes, a grow- ing middle class, urbanization, and the expansion of fast-food outlets in these countries. Whereas potatoes grow in almost every country around the world, there are only four countries that have a significant frozen processed potato sector: the Netherlands, Belgium, Can- ada and the US. Combined, these countries export more than 80 percent of all frozen processed potatoes. Although all four countries increased exports, frozen processed potato processors in Belgium were most successful. Belgium expanded its share in global exports from 18 percent in 2007 to 29 percent in 2017. Cost-effective production of frozen processed potato prod- ucts requires a year-round supply of high-quality potatoes. To achieve the yield necessary for processing, potato growers in North America and northwestern Europe invested in knowl- edge, mechanization, storage and irrigation. As a result, the yield per hectare is high in both regions. The prerequisite of yield, quality and year-round supply means that the barriers to entry for frozen processed potatoes are high. This gives processors in the four exporting countries a favorable export position. On the other hand, this position makes the sec- tor vulnerable to trade tensions, as recent import tariffs on the export of European fries to Latin America have shown. A way to overcome the risk of such rising trade tensions is to diversify production geographically. DUTCH SEED PLANTED WORLDWIDE Over the last 10 years, the Dutch seed potato sector increased exports by 300,000 metric tons, to almost 1 million metric tons in 2017. Other European countries such as France and Germany also saw their exports increase. With an export share of over 50 percent, Dutch seed potato growers are a very important source of high-quality seed potatoes.

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