Rather than call for diversions, farmers raise standards, increase donations
By DAVE WILKINS
Albertson's stores in Southern Idaho were recently selling 10-pound bags of Russet potatoes for 98 cents each.
That's right -- nice Idaho-grown bakers for less than 10 cents per pound.
Unfortunately, the discounted spuds probably reminded many growers of the terrible year they've been having.
Grower prices have been sliced by more than half in less than a year.
Idaho farmers received just $2.90 for every 100 pounds of potatoes sold on the fresh market in March, according to USDA's National Agricultural Statistics Service. That's a decrease of more than 50 percent from $6.90 per hundredweight in April 2009.
Nationally, potato farmers received $5.26 per hundredweight for their fresh-market spuds in March, down from $11.98 in April of last year.
In the past when the market has plummeted like this there have been calls for a diversion program. On a few occasions the USDA or a growers' co-op has responded, paying farmers a small amount to dump surplus spuds.
But that hasn't happened this time for good reason.
First, growers were warned this wreck was coming.
Second, paying farmers to dump potatoes probably wouldn't look good when nearly 10 percent of the country is out of work and people are losing their homes to foreclosure.
Instead of calling for a traditional diversion, grower/shippers have raised quality standards at packing sheds and have stepped up charitable donations. Food banks across the country have reported generous donations from potato growers this year.
Growers in Idaho have been moving more of their smaller spuds that would normally be packed into consumer bags to secondary markets such as processing and livestock feed.
The result is that shoppers are getting "better and bigger potatoes in the grocery store," said Britt Raybould, a spokesperson for United Potato Growers of Idaho.
Growers had four consecutive good years leading up to this crash. That's unprecedented.
Many experts warned that the market was poised for a decline.
United Potato Growers of America and its state affiliates pleaded with farmers in late 2008 and early 2009 to reduce their plantings. Many did, but there were enough big growers outside the co-op who ignored the warning that the market became over supplied anyway.
Overplanting isn't the only reason for the poor potato prices. There are several factors, including higher yield trends, a recession that has kept people away from restaurants, tight restrictions on fresh shipments into Mexico and a 20 percent tariff imposed by Mexico on U.S. frozen potato products.
For growers to crawl out of this ditch, they need a firm marketing plan for every acre of spuds they grow, industry officials say.
Without it there could be a lot more 10-cent per pound spud sales at your local supermarket.