Potatoes

Potato updates

Slight reductions in 2024 crop helps to balance supply and demand.

USDA's final production numbers for the 2024 potato crop show a 5% decrease from 2023 due to fewer harvested acres and an average yield reduction of 5 cwt per acre. In the Pacific Northwest, a 26,000 harvested acre reduction was offset by above-average yields and ideal harvest conditions. Washington yields increased by 15 cwt per acre to 645 cwt per acre, while Oregon saw a 5 cwt per acre increase. Montana seed potato growers remain optimistic despite water rights challenges.

The 2024 Northwest potato crop is relatively balanced after two years of shortages followed by a year of surplus. Because supply and demand are better balanced, crop prices are unlikely to increase. Open-market potato prices have stabilized, with the Idaho Grower Returns Index (GRI) for Burbank and Norkotah remaining in the low to mid $7 per cwt range, and Washington’s Columbia Basin Grower Return Index holding steady at $7.01 per cwt throughout November. Looking ahead to 2025, tight profit margins and weak consumer demand may discourage planting.

Four of the largest potato processors in North America were named in a pair of proposed class action lawsuits. The suits, filed in late November, accuse the processors of conspiring to overcharge retailers and other customers. These processors collectively control about 97% of the processed potato market.

Profitability

December 11, 2024

Potatoes (Contracted): Slightly profitable - Neutral 12-month outlook
Potatoes (Uncontracted): Breakeven profitability - Neutral 12-month outlook

Stable pricing agreements benefit contracted potatoes, and decreases in input costs are expected to support profitability over the next 12 months.

Tight profit margins and weaker consumer demand may discourage potato planting in 2025, potentially supporting uncontracted prices.