By Annisa Essack

21:10:2020

The versatile potato has seen a massive surge in prices in South Africa in recent months due to the unusually cold winter in Limpopo which impacted the early part of the province’s harvest.

The average market price of a 10 kg bag of potatoes, this month, reached a staggering R83. Looking back as recently as June, the average price was R34.40, according to data from Potatoes SA. A crunching increase of 140% in four months!

Dr Andre Jooste, CEO of industry association Potatoes SA, says potato prices in the period since mid-June have been 46% higher than in the same period last year. The current price surge surpassed previous highs experienced in 2016, at the height of the drought. Prices then reached R63 per 10 kg bag, across all classes and markets.

Jooste says, that this year’s price hikes are due to a rather cold winter experienced in Limpopo, the nation’s biggest producer this time of the year.

With the first harvests coming through from June and July and the main harvest coming to the market in August to November, Jooste believes that the main harvest should be relatively unaffected as temperatures have stabilised.

But, he warned,  a surge in temperatures could spell danger for the rest of the season, as the plants would stop growing.

Sweet potato prices have seen a similar surge as potatoes – prices are 168% higher than a year ago, according to the agricultural market information source AMT.

The potato is a primary agricultural product, the demand for which is relatively inelastic – even amid the fallout of the pandemic. A small change in supply on the domestic fresh-produce markets can mean a big change in potato prices.

The pandemic and lockdown saw household income squeezed, and fast-food outlets forced to close, dampening the demand for potatoes but it has recovered in recent months.

European producers, hit be the fading demand due to the pandemic are looking for alternative markets and South Africa is a viable option. While South Africa exports around 8% of its potato crops to neighbouring countries, it still imports relatively large amounts of French Fries from European producers.