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Market Monitoring Frozen Potato Products: Insights July 2022
Mathieu Geuskens published on October 20, 2022
In this monthly Frozen Potato Products update, our analysts will share valuable insights about the Frozen Potato Products industry. This month: Global trade volume are up 10.5% YTD compared to 2021, and prices are up 16.5% YTD.
Market monitoring of frozen potato products
Market monitoring helps agri food companies to objectively evaluate their current position within the market and the development of that position. Furthermore, it helps to spot new growth opportunities and whether the market is saturated.
For the A-INSIGHTS Market Monitor, we analyze the global trade in frozen potato products on a monthly basis. Derived from local customs agencies and statistics offices, the data gives us insight into monthly trade volumes and prices for all major importers and exporters. Combined with our sector expertise, we can provide you with an up-to-date view of the developments in the global frozen potato market.
Volume growth slows down in July, prices remain at record level
With a global trading volume of 738 thousand tonnes in July 2022, frozen potato trade volume was up 2.9% compared to 2021. As such, trading volume continues to grow, although volume growth is down significantly compared to previous months: volumes were up 11.9% in June, and over the first 7 months of the year, volumes remain up 10.5% compared to the same period in 2021. Presumably, the reduction in volume growth will continue into the coming months as harvests in the Northern Hemisphere start in September, which will allow US producers to build inventory and better meet domestic demand in the shorter term than they have in previous months.
Prices remain on record levels as a result of cost inflation, constraint supply, and a weak Euro: at an average €0.99/kg, prices are up €0.01/kg compared to June and €0.13 (23.8%) compared to July 2021. Year-to-date trading prices are up 16.5% compared to the same period last year at €0.92/kg.
Figure 1. Global frozen potato trade volume in th. tonnes and price in €/kg, YTD until July
Netherlands exports down, Belgium & Canada sustain growth
Exports by Belgium (+5.8%) and Canada (+10.2%) continue to show steady growth, but exports by the Netherlands (-3.5%) softened in July. Price levels seem to play part in the reduced demand for Netherlands exports, as frozen potatoes from the Netherlands increased 28.8% year-over-year and now trade at higher prices than Canada. Given the grim harvest projections in the Northern European production region, it seems likely that Belgian suppliers will have trouble sustaining this year's export volumes and prices.
Although total export remains limited compared to European and North American producers, export from India is increasing sharply in the past months. In July, the export volume was up 3 thousand tonnes (+60%) compared to the previous period, mainly supplying countries in South East Asia. With announced capacity expansions by local producers, it is expected that the role of India in the regional supply will continue to expand.
Figure 2. Top 5 exporters, volume in th. tonnes and price in €/kg, July 2022 compared to July 2021
U.S. demand remains high and strong growth in Japan
In absolute terms, year-over-year volume growth remains largest in the U.S., which 10.7 thousand tonne volume increase (+12.2%) is over half of the global monthly volume increase. The continued increase of U.S. demand for frozen potato imports is visible in the 15.1% year-over-year increase of the year-to-date volume, as U.S. producers continue to be constrained by raw material shortages resulting from a bad harvest and domestic demand increase.
A notable increase is visible in Japan imports as well: at 39.1 thousand tonnes, July volumes are up 25.8% compared to the same month in 2021. The U.S. remains the largest frozen potato exporter to Japan, but the Netherlands, Belgium, and China are gaining share. It is possible that this change in supply situation is the result of producers utilizing the geographical spread of their production network to handle raw material shortages and disrupted supply chains, which is likely to carry over in the next harvest year with harvest projections down in traditional production regions.
Figure 3. Top 10 importers, volume in th. tonnes and price in €/kg, July 2022 compared to July 2022
Upcoming product update: new design and added functionality
In the coming month, we will roll out the new and improved MarketMonitor. This product update includes a cleaner and more intuitive design, which allows for both the easy sharing of snapshots with colleagues and drilling down to more detailed information to incorporate into your own analysis. Furthermore, we have added the functionality to change the currency in which values and prices are displayed and included ratios that were requested most by our clients. Next week, we will share a more detailed product update to take you through the new dashboard and its functions, but please reach out if you have any requests in the meantime.
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