Alexey Krasilnikov, executive director of the Potato Union
The planting of potatoes in the new season began with a delay and by the time of this writing (May 24) had not yet been completed, although the weather allows to increase the pace, which means that most farms will have time to meet the agrotechnical deadlines.
The area under potatoes will increase as expected, but there are no prerequisites for a significant jump. In general, the forecast for the current year for market participants is quite optimistic, and in the next five years they will have great prospects.
Prices
Before dwelling on these topics in more detail, let's say a few words about the end of the previous season: it can rightfully be called very successful for potato growers.
Wholesale prices for potatoes from the beginning of autumn to mid-spring were on average 2-2,5 times higher than the corresponding indicators of the previous season and allowed agricultural producers to feel quite confident.
Since the beginning of May, we have noted a slight decrease in prices in the wholesale segment, it is due to the presence of balances on the market (by May 1, 2021, about 572 thousand tons of products were still on the balance of large agricultural enterprises, a year earlier the balance was 548 thousand tons) and an increase in volume import.
Most likely, the fact that some of the products remained unsold is caused primarily by quality problems (more precisely, the inadequacy of the goods to the requirements of retail chains in appearance and caliber).
Import
The volume of potato imports to Russia this season increased compared to the previous one, but still we cannot say that they are “pressing” the market.
So, in January, our country imported 6 thousand tons of potatoes, of which 4,5 thousand tons - from Belarus, 634 tons - from Egypt. Thus, it should be noted that the supply channel for early Egyptian potatoes opened earlier than usual (due to the fact that retail chains were not sure that there would be enough volumes of a high-quality Russian product on the market). In February, the volume of imports has already grown to 25 thousand tons, of which 18070 tons came from Egypt. The Republic of Belarus sent 4684 tons of table potatoes and 204 tons of seed to Russia.
Significantly more seed potatoes were brought to Russia in April: 670 tons, of which 286 tons from Belarus and 180 tons from Finland. And the total volume of imports of potatoes (including marketable ones) reached 100 thousand tons.
The main flow of seed started only in May. At the same time, consignments of products from Finland, Germany and Scotland were delivered to the country along the "green corridor", without video sampling, and potatoes from the Netherlands, Poland, France passed all stages of verification in accordance with the Rosselkhoznadzor regulations.
The total volume of seed potatoes that entered Russia from other countries by the 2021 planting season is not known at the moment. Previously, agricultural producers applied for the import of 19 thousand tons, but we believe that in reality the scale of purchases will remain at the level of last year (9 thousand tons) or slightly lower. But it is too early to sum up the results, many games are still on the way.
Concluding the conversation about the import of seeds, I will once again point out a steady trend: with each new season, supplies of starting material (mainly minitubers, microplants are still a little more difficult to import).
Landing plans
According to the Ministry of Agriculture of the Russian Federation, in 2021, about 290 thousand hectares will be allocated for potatoes in the industrial sector. Recall that last year, according to forecasts, potatoes were supposed to occupy 280 thousand hectares, but in fact, the harvest was carried out from 266 thousand hectares. If we use the latest data for comparison, the increase will be 25 thousand hectares.
The five leaders in terms of expected areas include Bryanskaya (27 thousand hectares); Tula (20 thousand hectares); Nizhegorodskaya (13,8 thousand hectares); Moscow (13,6 thousand hectares) and Sverdlovsk (13 thousand hectares) regions.
At the same time, we note that most large agricultural holdings in the current season chose not to make radical changes to their potato programs: someone left the same volume of cultivation, some slightly reduced the area, hoping to compensate for the reduction through the use of modern technologies.
Taking this into account, we can make a preliminary conclusion that a sharp increase in the area for potatoes (which has been much written about and feared) will not happen this year.
The growth of interest in culture is observed mainly in those regions where processing enterprises are preparing for the opening (or increasing capacities). More potatoes are planted, for example, in the Novosibirsk region, where a PepsiCo potato plant is under construction; in the Lipetsk region, where Belaya Dacha Farming is going to put into operation the second line for the production of French fries (increasing the volume of raw materials processing by 100 thousand tons per year).
It is obvious that refiners will continue to serve as drivers of the industry development in the future. The queue is for the Tula region, where in the coming years factories for the production of French fries (McCain Foods Rus) and potato flakes (IP M.Zh. Avetisyan) will be launched.
Weather
By mid-May, in most regions, there was a serious lag behind the usual planting rates. Many went into the field two weeks late, since the weather conditions in early May were not the most favorable (in the central regions and the Volga region there was a significant amount of precipitation, low temperatures remained).
On the other hand, a number of companies were able to use the two-week delay to obtain approval from the Rosselkhoznadzor and organize the logistics of the main consignments of seeds.
Now work is already underway throughout the country. According to the operational data of the management bodies of the agro-industrial complex of the constituent entities of the Russian Federation, by May 21, in agricultural enterprises and peasant (farm) farms, potatoes were planted on 159,5 thousand hectares (this is 54,9% of the forecasted area). At the same time, in a number of regions, cool weather was replaced by a period of abnormal heat (10-12 ° C warmer than normal). But since in most of the territories there is still enough moisture in the arable layer, this whim of nature does not pose a threat to the future harvest. In the future, in the central regions of Russia, forecasters promise an alternation of moderately warm weather with intermittent rains, which will contribute to the optimal development of culture.
In general, those companies that quickly completed planting took good starting positions in the race for the harvest.
Sorts
Discussing the issue of the choice of varieties by agricultural producers, we rely on the data of the Russian Agricultural Center from 2020, but in the new season no fundamental changes have yet been noted.
As before, the lion's share of Russian potato areas (57%) in the commercial sector is occupied by 10 varieties, 9 of them are of foreign selection. And this despite the fact that 494 varieties are currently registered in the State Register. In total, according to the results of the 2020 sowing campaign, agricultural producers used 169 varieties of seed for planting. For comparison, in 2018, 423 varieties were registered in the State Register, of which 177 were in demand by agricultural producers. That is, the number of varieties is growing, and the interest of farmers in new products is falling, those that have been tested over the years of cultivation remain on the list of leaders.
Of the positive trends, the reduction in the use of uncertified potatoes should be highlighted: in 2018, 264 thousand tons of non-varietal seeds (33% of the total volume) went for planting, and in 2020 - 221 thousand tons (29%). Main reason: The use of certified seed has become a prerequisite for receiving subsidies.
Growth prospects
If weather conditions are favorable during the season, the volume of potato harvest in the commodity sector will reach the usual level of 7-7,5 million tons. And from the point of view of the experts of the Potato Union, this amount of production may not be enough, and in the future, maintaining production at the same level threatens the country with a shortage of potatoes.
According to Rosstat, the rate of decline in gross harvests - due to the refusal of Russians to grow crops on their personal subsidiary plots - is steadily increasing. In the period from 2000 to 2015, the annual reduction remained at the level of 600 thousand tons. Since 2015, a million tons have already been deducted from the total amount of fees.
While maintaining the current rate of departure, the collection volume in the private household plots sector will not exceed 2026 million tonnes by 6,7 (in 2020: 12,7 million tonnes).
And according to experts' forecasts, by this time, only processing enterprises will consume at least 3 million tons of raw materials (now - 1,6 million tons). The only way to prevent potato shortages is to increase production. The growth of areas in the country should be at least 5% annually. Under this condition, by 2026, potatoes will occupy about 376 thousand hectares, and the volume of gross harvest in the commodity sector will reach the required level of 11,6 million tons.
Time will tell whether the authorities and industry representatives will listen to the opinion of experts, but there is very little left to make key decisions.
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