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Published May 08, 2014, 11:20 AM

Manitoba spud growers still in talks with Simplot

Keystone Potato Producers Association based in Portage La Prairie, Manitoba, has yet to complete negotiations with Simplot Canada II over a contract for 2014 production.

By: Mikkel Pates, Agweek

FARGO, N.D. — Keystone Potato Producers Association based in Portage La Prairie, Manitoba, has yet to complete negotiations with Simplot Canada II over a contract for 2014 production.

Dan Sawatzky, manager for the association and a negotiator for the potato producer organization, says negotiations are expected to end soon. The association earlier completed talks with McCain Foods Canada on April 25, with undisclosed price terms.

Sawatzky says the growers are concerned but aren’t yet panicked because very few potatoes have been planted in the region. Simplot cut volumes by about 10 percent from last year. McCain is expected to be down 20 percent.

Manitoba is Canada’s second-largest potato growing region, with about 70,000 acres grown in the province in 2013, on about 63 farms. About 55,000 of those acres are for processing, and the rest for fresh, chip and seed markets.

North Dakota negotiations with Simplot reportedly were completed about three weeks ago. Chuck Gunnerson, president of the Northern Plains Potato Growers Association, says he doesn’t have firsthand knowledge but understands volumes could be down 2 to 3 percent in North Dakota.

Last year, McCain handled a total of 8.4 million hundredweight at plants in Portage La Prairie and Carberry in Manitoba. Simplot’s plant handled about 5.4 million hundredweight. About 80 percent of potatoes processed in Manitoba are exported to the U.S.

In a related matter, Cavendish Farms of Jamestown, N.D., has reduced its contracts with Manitoba growers to 305,000 hundredweight for 2014, Sawatzky says. That’s down from 613,000 hundredweight in 2013 and from as high as 1.8 million several years ago.

Cavendish has been able to source more of its product locally, Sawatzky says. Freight adds cost from Manitoba, but Sawatzky says recent shifts in the exchange rates between the two countries might allow some business to return to Canada “not only with Cavendish but with overall volumes.”

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