Wisconsin potato growers not completely fried by the coronavirus
While many potato growers across the nation are being forced to mash their spuds into the ground, Wisconsin's spud producers aren't feeling as hard a hit from COVID-19 as their western counterparts.
In big western potato producing states like Idaho, Washington and Oregon where the growing season is a month or two ahead of Wisconsin, some growers had to make the difficult decision to disc some fields of potatoes under.
A vast majority of their potato production goes to the processing food sector that supplies potato products to schools, restaurants and hotels. When the coronavirus shut those places down, that sector of the potato industry "basically fell off a cliff," explained Tamas Houlihan, executive director of the Wisconsin Potato and Vegetable Growers Association.
About 20% of Wisconsin's potato production goes to McCain Foods to be made into french fries, hash browns and tater tots for the frozen processing food sector which was hardest hit in the pandemic. Wisconsin contracts for that processing sector were cut 25%, Houlihan said, but with the reduction affecting less than a quarter of the state's total potato industry, the impact was only about a 5% loss on the state's entire industry.
Since a lot of the Wisconsin potatoes heading to McCain were no longer needed for the food service market, Houlihan said most potatoes in the state got diverted to the fresh market where consumers can buy bags of potatoes in the grocery store.
While potatoes destined for french fries, hash browns and tater tots are a different variety than those sold in the fresh market, it's still a good potato. And it's better than having those potatoes go to waste or rot.
"It hasn't been a huge problem in Wisconsin, but what is looming ahead is a flooding of the fresh market," Houlihan said.
When potatoes from all the western states, along with those from Wisconsin, Michigan and Minnesota are harvested in August, September and October, "we're facing a massive oversupply situation in the fall," Houlihan said.
With "so many potatoes in the pipeline right now," Houlihan said the real concern in Wisconsin is about "the prices to growers dropping below the cost of production once we hit the fall."
Knowing of the high potential for an oversupply of potatoes come fall, some Wisconsin producers have cut back a little on planting, however, a lot of growers had already purchased seed and fertilizer and other inputs and some had started planting before the coronavirus turned the world on its head. Houlihan estimates the state will be down 3-5% in planted acreage this year.
Some growers who had already bought seed and had contracts cut 25% by McCain Foods are going to grow the potatoes anyhow and hope they can sell them on the fresh market.
"But that's going to be a huge problem in the fall, especially with all the western indicators that are available on the fresh market," said Houlihan.
A large sector of Wisconsin potatoes goes to its chipping production where the spuds are turned into potato chips — a sector of the potato industry that is doing well right now, Houlihan said. About 25% of Wisconsin's potato product is for chips with the state being one of the largest potato suppliers in the nation to Frito Lay.
Wisconsin grows the most varieties of any potato producing state. About 45% of the state's production goes to grocery stores and those can be a number of different varieties — Russet, white, red, Houlihan said. Wisconsin is also growing a significant amount of yellow skin potatoes and has a fairly large specialty potato market which could be fingerlings or purples or small golf-ball sized potatoes grown by the Little Potato Company.
McCain Foods in Plover, WI, also has a significant retail sector within its business, which is also beneficial for Wisconsin growers during the coronavirus. About 30% of its production in Plover goes to retail in the form of frozen potatoes in the grocery store.
"That sector is still healthy. A lot of people are buying potatoes at the grocery store," Houlihan said.
More people buying food in grocery stores and eating at home has been good for canned and frozen vegetable as well. For the last 20 years, consumption of canned and frozen vegetable has been slowly declining.
"But with the advent of the coronavirus, people were stocking up with cans and all of a sudden we saw canned veggies increase in consumption," said Houlihan. "We're hoping that this increase in vegetable and potato purchases at the grocery story is something that carries over, even after the coronavirus is under control. We feel like more and more people are starting to enjoy the benefits of cooking at home and eating healthy vegetables. So maybe there is a silver lining to this coronavirus."