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In their November 2024 potato update, AgWest Farm Credit reports that the potato industry is grappling with significant challenges balancing supply and demand.
According to the report, the excess of 2023 potatoes in storage has kept prices depressed at the start of the 2024 crop season. Much of the old crop still in storage has been sent to feedlots to make room for the new 2024 crop. While final estimates for the 2024 potato crop are not yet available, anecdotal reports suggest that potato production in the West is down nearly 5%. In the Pacific Northwest, a notable reduction in potato acreage (down 20,000 acres from 2023) was offset by above average yields and ideal harvest conditions.
Lackluster restaurant demand for potatoes and frozen potato products has further hindered rebalancing of the market. Compounding these issues, the closure of a potato processing plant in Washington has posed further challenges for producers, highlighting weakening consumer demand for frozen potato products.
The industry is also dealing with uncertainties related to irrigation water allocations, particularly in the Klamath Basin, where new drought response programs are being implemented to manage water resources more effectively. As the industry navigates these turbulent times, producers have few profitable alternative crop options and face difficult decisions regarding 2025 crop field prep and planting.
SOURCE: AgWest Farm Credit
