Potato growers ponder COVID-19 pandemic’s fallout

Potato growers ponder COVID-19 pandemic’s fallout

Northwest potato suppliers say they are eager to rev up a major sales engine in their industry — foodservice — as the COVID-19 coronavirus pandemic passes.

The pandemic shuttered restaurants across North America through the spring months, and many were just beginning to reopen — with social-distancing and occupancy restrictions in place — by the end of June.

Potato suppliers said they were hopeful that the bleakest depths of the crisis had passed, so they could point potato sales in the direction of normality.

“About 50% of our fresh potato sales and 95% of our processed potato sales occur within the foodservice sector,” said Chris Voigt, executive director of the Moses Lake-based Washington State Potato Commission.

Some eateries hobbled along during the pandemic with the help of curbside, delivery or drive-through service, but it was less than ideal for potato suppliers, Voigt said.

“When restaurants were closed or limited to take out and drive through, it was a devastating hit to our potato community,” he said. “One billion pounds of potatoes in storage no longer had a home.”

Processors cut 20% of the acres for the 2020 crop, and individual cuts for each grower ranged from 10% to 100%, Voigt noted.

Suppliers hoped the U.S. Department of Agriculture would step in to provide relief, but the agency’s programs “fell far short,” Voigt said.

Foodservice sales were down, but retail went up, said Tony Wisdom, founder/CEO of Burlington, Wash.-based Valley Pride Sales LLC.

“The COVID-19 impact in the food business is very scary, and crazy at the same time,” he said. “Since we are primarily a fresh market retail shipper, we’ve been in a bright spot of the produce market.

?Demand is high and pricing has been strong, but we don’t really know how this plays out.” ?

Reopening foodservice outlets are helping, but it will be a slow climb back to normal, Voigt said.

“We will be feeling the COVID impacts for at least two years, if not longer, as the supply chain disruptions even affected our seed potato supply,” he said.?

“Even if the market were to fully rebound tomorrow, we likely wouldn’t have enough seed potatoes for the next crop of spuds.?

Many growers have taken “devastating” financial hits in the pandemic, Voigt said.

“I worry about our younger or newer farmers and whether they will be able to survive this storm,” he said. “They might not have enough equity in their farms to allow them to continue.”

Still, some improvements were perceptible in late June, said Gary Roth, executive director of the Portland-based Oregon Potato Commission.

“The international market for frozen potato products is starting to improve; I think the domestic market is beginning to pick up commensurate with states opening up and allowing restaurants to have people in their establishments, and I’ve heard that the overall reduction for 2020 was pretty close to what was predicted,” Roth said.?

Automation at many potato operations has been a bright spot in an otherwise-gloomy situation, Voigt said.

Everyone has been very diligent in keeping our work force safe so that we can continue to provide food to others,” he said.

As for packaging, fresh potato sales in 5- or 10-pound bags at retail “have been good,” but carton prices sank as foodservice business disappeared, Voigt said.

“Most of those premium carton potatoes were put in bags and sold at a much lower price,” he said. “We’re starting to see some recovery in the foodservice business, but we still have a long way to go.”

Grower-shippers say they have been diligent in implementing tighter social-distancing and other safety rules.

“We’ve stepped up our sanitizing, and all our sheds are locked,” said Larry Sieg, Washington manager with Idaho Falls, Idaho-based grower-shipper Potandon Produce. “Nobody comes in -- no UPS, no FedEx, no salespeople, even our truck drivers, we don’t allow into the checkout area.”

All workers wear masks, plus get their temperatures checked daily, Sieg said.

Potandon’s foodservice business was back to, perhaps, “75% of normal” by the end of June after an earlier dip to “probably 20%,” Sieg said.

What happens as the Northwest potato season unfolds over the summer and into the fall is anybody’s guess, said Paul Kern, salesman with Clackamas, Ore.-based Botsford & Goodfellow Inc.

“I don’t know of anybody that knows what will happen over the course of the upcoming fresh crop russet harvest,” he said. “Up until the middle of March, the industry was facing a supply shortage, and it seemed un-probable that we could collectively bridge the gap to July.” Then, COVID-19 hit.

“There is no blanket answer as to how things will unfold in the next few months, or what sectors will see increases or decreases in production and consumption,” Kern said.

B&G was retooling its facility to accommodate the present COVID safety guidelines, Kern said.

“This includes reducing the number of employees at some stages in the packing line to allow for the greater distancing,” he said.

The COVID-19 virus left a lighter touch on Oregon’s potato-producing Klamath Basin, although all of the standard precautions were put in place, said Terry Guthrie, owner of Riverside Potato in Klamath Falls, Ore.

“We’ve had very few cases in Klamath County; I would think you’d get the same answer every place east of the Cascades,” he said. “They were treated like everybody. The restaurants were shut down.

The bars were shut down. It’s crazy. They went about this all wrong.”

Retail potato sales continued apace, said Dan Strebin, co-owner of Gresham, Ore.-based South Basin Packing and Strebin Farms.

“I guess same-store sales volume off the top of my head and just knowing what the flow is, I’d say it’s very normal,” he said.?

Foodservice sales remained sluggish, although they should pick up, Strebin said.

“At foodservice, I think it will be a slow go, but people want to be out, and that will build and will continue to grow,” he said.

Kirkland, Wash.-based Pacific Pro absorbed a big blow early in the pandemic, but the company bounced back, said Marcus Hartmann, partner.

“It was a challenge for those first few weeks,” he said. “Once various school district and municipalities figured out how they were going to do programs, all that contributed to a considerable uptick.”

The pandemic struck near the end of the season for Klamath Falls-based Wong Potatoes Inc., said Ron Settlemire, sales manager.

“We did our last shipment June 3; we’ll see how startup goes in September,” he said. “Keep ‘em masked, gloved, washing and doing everything they’re supposed to be doing.”

With many food-safety rules already in place, a layer or two of additional precautions didn’t seem like much of a challenge, but there were a few difficulties, Wisdom said.

“The implementation of some of the protocols for our field crews, tractor drivers, mechanics etc. on the production side was much more challenging to think through and implement without it creating a production drag,” he said.?

“It adds cost to have folks available to monitor the adherence, refill and replace the products and track the program. Some of the supplies needed took a while to gather up, as well.”

Washington and Oregon potato acreage down, but plenty expected
Coronavirus (COVID-19) News Updates
Marketing opportunities abound, potato suppliers say
Weather turns from foe to ally for potato growers?