The Potato Phenomenon: Navigating the Rise in Potato Prices and Supply Challenges

Prices for potatoes in Ukraine are hitting record highs due to a combination of increasing demand and limited supply of high-quality potatoes. At Odessa's "Start" market, potato prices have nearly doubled in the last two months. However, this frenzy might be short-lived, as it indicates factors that could sustain high prices, such as cold weather and a shortage of domestic produce.

Yaroslav Andreev, Executive Director of UAPC, states that the wholesale price of potatoes will not decrease and may even reach 20 UAH/kg. Additionally, a shortage and increase in the price of seed potatoes are expected.

Alex Slosser, an agricultural marketing expert at Holden, comments:

"In the face of shortage and high prices, it's important for producers to focus on improving logistics efficiency and expanding sales markets."

In Europe, there's a greater variety of potatoes available, including smaller sizes and even specialty types. There's a high demand for processing, particularly for making French fries. Conversely, in Ukraine, the culture of potato consumption differs significantly.

Experts caution that venturing into the seed potato business comes with certain risks, including additional costs for laboratory testing and certification. "Domestic certified companies are facing a major problem due to price increases leading to the growth of a 'grey' market, making it challenging for those who operate transparently to withstand unfair competition," they warn.

Only those with storage facilities can make a profit. In the Chernihiv region, farmers are satisfied with their potato yield. However, production costs were substantial due to fluctuating weather conditions, requiring the use of plant protection products every 7-9 days.

"This has been the most challenging year in my potato farming career since 1993. Thanks to frequent treatments, we achieved high-quality potatoes with good vegetation. Yields exceeded 60 tons/ha for some of our varieties, especially the Chernihiv Souvenir. Among foreign varieties, Arizona performed well, although it has a lower starch content, and processors pay less for it," shares Igor Shkurko, director of NVO "Chernihivelitkartoplya."

He predicts that potato stocks will diminish, and the wholesale price in February could reach 20 UAH/kg, but only those with storage facilities will be able to profit.

Due to the high cost of fertilizers, only a limited area - about 100 hectares - was planted with potatoes, mainly for seed material. These are being sold via "Nova Poshta" across unoccupied Ukraine.

"The demand for seed potatoes has increased. Now, there are very few early varieties left, and prices will rise towards spring, with a reduction in the assortment. All varieties are popular—early, mid-season, late, for long-term storage, both foreign and domestic. We, as breeders, sell seeds at 25 UAH/kg," notes Igor Shkurko.

There are no plans to increase the area under potato cultivation next year.

Starch production is on the rise. As many potatoes were of low quality this season, they were sent for starch production, since the market for fries is almost undeveloped in Ukraine, and chip production is limited, partly located in hazardous zones.

According to UAPC data, there are 7 starch plants in Ukraine, all operational. The major producers are Vimal in the Chernihiv region and CPG in the Lviv region.

"There's currently a boom in starch production as demand increases, making potatoes for processing in demand, especially since Europe has lifted restrictions and quotas on imports, allowing our producers to manufacture and export starch. The adoption of the law on ecological packaging also contributes, as eco-bags are made from starch, particularly potato starch," states Yaroslav Andreev, Executive Director of UAPC.

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