Growers rush to sell as potato prices fall sharply recently

Potato prices have recently maintained a relatively large decline, with the biggest drop reaching as much as 14%. What is the reason for such a large drop in potato prices? After potatoes changed from a vegetable to a staple food, will this affect potato prices?

Growers rush to sell as potato prices fall sharply recently

Editor's note: These past two days, the humble potato has become the focus of everyone's attention. Looking at the market, today let's talk about potatoes. Ever since potatoes changed from a vegetable to a staple food, food lovers' hearts have been quite conflicted: should they make potato rice or potato flour? However, for potato growers, what they care about most is still the price.

Our reporter learned that potato prices have recently maintained a relatively large decline, with the biggest drop reaching as much as 14%. What is the reason for such a large drop in potato prices? After potatoes changed from a vegetable to a staple food, will this affect potato prices?

According to a report by China Rural Voice's "Agriculture, Rural Areas and Farmers in China," Sun Dong is a large potato grower in Yangjiawan, Weichang Manchu and Mongol Autonomous County, Chengde City, Hebei Province, and his family has planted more than 100 mu of potatoes. Sun Dong told the reporter that high input did not bring him high returns, and the current potato market really made him break into a cold sweat. If prices keep falling like this, he really will not be able to bear it.

Sun Dong: "Recently it is still not very good, prices keep falling. For Kexin (a potato variety), those above two liang are three mao six, three mao six per jin."

Sun Dong's household is not the only one worrying. Zhao Gang, a potato dealer in Zhuanjing Town, Dingbian County, Yulin City, Shaanxi Province, has seen through the rises and falls of the potato market over the past few years. He said that at the current price, one mu of land can yield one or two thousand jin, which can then be sold for several hundred to more than a thousand yuan, but after deducting more than one thousand yuan in investment, a whole year's work amounts to nothing.

Zhao Gang: "I have too many thoughts about this matter. The main issue is that farmers' potatoes cannot fetch a good price year after year, and they lose money. The main reason is that potato prices are low, and they cannot even sell for the price of cabbage. Year after year, farmers lose money on every mu of potatoes and cannot make a profit. Farmers have to lose money."

The latest monitoring data show that compared with January 8, on January 9, potato prices fell in 7 provinces across the country. Among them, Liaoning had the largest drop in potato prices, at 1.52 yuan per kg, a decline of 14.12%. Why have potato prices seen such a large decline? He Tan, an analyst at Zhuochuang Information, believes that on the eve of the Spring Festival, growers rushing to sell was the main reason.

He Tan: "Especially from December to now, because as the Spring Festival approaches, farmers and storage households have a relatively high enthusiasm for selling and are rather anxious, so prices in production areas such as Inner Mongolia and Hebei have seen relatively obvious declines. This price is already lower than the price during the listing period, because after a period of storage, the price is instead lower than the price during the listing period, and the decline may have reached about 40%."

He Tan explained that, in fact, potato prices did not only start falling recently. Since potatoes were listed on the market last year, the market has been like riding a slide, falling all the way, and this has also continued the potato market's consistent style of dramatic rises and falls.

He Tan: "Prices in most production areas fell by 40% to 50%. It can be said that the decline in prices has been very large. From 11 to now 14, potato price fluctuations have been very obvious. Basically, 14 was the lowest, 12 was slightly better than 11, 13 reached a very high position, and in 14 prices again showed an obvious decline compared with 13. Potato prices fluctuate up and down, and the fluctuations between years are very large."

So, are all major potato production areas singing a sad song? That is not the case. He Tan explained that the price gap between different production areas is now relatively large. Especially in production areas such as Shandong, because this year's inventory is slightly lower, prices are relatively high.

He Tan: "For production areas such as Inner Mongolia and Hebei, this year the price gap with Shandong production areas may reach 0.4 to 0.5 yuan. This year also has this characteristic, so the price gap between production areas is relatively large."

Looking back at the past year, it is not hard to find that poor sales and low prices were the keywords of the 2014 vegetable market. At that time, potatoes, as a vegetable, were of course also in this vortex, so it is not hard to understand why prices fluctuated so much. Last year potatoes were still a vegetable, but now they have become a staple food. Facing such a change, some growers also place expectations on the future potato market.

Hebei potato grower Sun Dong: "Things are precious when they are scarce. The more there are, the more prices certainly cannot go up. Of course it is good to be a staple food, because as a staple food its demand is large."

However, He Tan, an analyst at Zhuochuang Information, also reminded potato growers that having expectations is good, but they must also be treated rationally. After all, potatoes have only just begun their identity as a staple food, and if the potato market is to undergo earth-shaking changes, that will still be difficult to achieve in the short term.

He Tan: "Now, because it is a staple food, the release of its demand requires a process. Because after it becomes a staple food, including if it is processed into noodles, steamed buns and other staple foods, consumers need a process to accept this kind of food, so the release of its demand requires a process, and this process may gradually be released over three to five years."

Of course, as potatoes become a staple food, their status has also become more important. For this reason, He Tan believes that the state may introduce relevant policies to ensure the stability of the potato market.

He Tan: "Later, the state may also introduce some purchase and storage policies similar to those for the three major staple foods, such as corn, wheat and rice, to ensure the stability of potato prices. Because if it is a staple food and its price is unstable, it may later lead to instability in its planting area or output, and it may not be able to solve the food security problem, failing to achieve the state's original intention of solving the food crisis. Therefore, later there may be some supporting specific measures to stabilize potato prices."