Potato Grower

March 2023

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46 POTATO GROWER | MARCH 2023 A businessman is someone that enters an enterprise that produces a product or that buys and sells (a) product(s) or ser- vices to make money. For a businessman to make money, he must bring in more money than he spends. To make this happen, the businessman must operate within certain economic parameters. Anyone following the potato produc- tion business for the past half century would agree that producers operating within profitable economic parameters was not always what happened. From about 1950 until 2004, for every profit- able year in fresh potato production, a producer could look forward to a year or two of unprofitability. Staying in business became the goal during those bad years. Remortgaging the farm to clean up the credit line was how it worked. Escalating land values is what backed operating lines, not business perfor- mance. Had operating lines depended on business performance for renewal rather than escalating real estate, potato markets would likely have stabilized sooner than they have. Before strict parenting became un- popular, a parent would give an unruly child a choice: "Stop behaving badly or be punished!" Back then, had banks "punished" potato producers for poor performance, producers would have looked more deeply into why markets failed and why markets succeeded. Since it was easier to increase the mortgage than figure out what was wrong with the market that is what happened. Today, every potato producer knows that the potato market's supply/demand balance is what dictates their crop's value, fresh or process. Balancing the supply/demand equation is the basis for valuing any commodity, be it gold, diamonds, crude oil, coal, natural gas, lettuce or potatoes. Key potato producers formed the United Potato Growers of America to demystify potato markets. Their research correlated sup- ply volumes with a crop's value, what else? This finding changed the culture of potato production; consumers now have stable supplies at great value, retailers enjoy stable margins, and producers can modernize their farms and farming practices, thereby supporting local and national economies. Everyone up and down the potato supply chain is now on solid footing. It's hard to imagine any- thing more comforting or more rewarding to a busi- nessman than to operate his business within fair return data. In terms of potato production, one's parents and grandpar- ents never had that opportunity; they fought it out in an information vacuum. Today's potato producer does not have to do that. Today's potato producer, operating within knowable production parameters, can build equity year after year, still providing the American con- sumer with unmatched value for each food-dollar spent. This is something that must not be taken for granted. Second to matching production to demand is keeping potatoes on top of the nutrition-per-consumer-food-dollar pyramid. Today's potato producer finds himself surrounded by support systems that make this happen; Potatoes USA is doing excellent work, so is the National Potato Council, and so are the United Potato Growers of America. As a producer, be thankful for these support systems and do your part to keep them operating as they do. PG Second to matching production to demand is keeping potatoes on top of the nutrition-per-consumer-food- dollar pyramid. A Businessman Staying for profit is the goal United Potato Growers of America Buzz Shahan Chief Operating Officer

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