Manitoba potato growers signed a contract with McCain Foods this week, but their prices won’t increase from last year.
Garry Sloik, manager of the Keystone Potato Producers Association, said it’s a relief to finally sign a deal for 2013, but production costs have risen so a deal without a price increase equates to a loss.
“It’s not necessarily good news in that we accepted a rollover price,” he said.
“So any cost increases this year are strictly out of the grower’s pocket.”
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McCain’s and Manitoba potato growers had been locked in a stalemate over the last few months. McCain’s had offered a five percent price decrease, but producers were unwilling to accept such a deal.
The company had offered similar contracts to potato growers in New Brunswick and Prince Edward Island. They accepted a rollover price earlier in May.
“That’s what made it difficult here (in Manitoba) to get much different,” Sloik said.
Growers are disappointed because Simplot, the other potato processor in Manitoba, had previously offered a slight price increase. Contract language now allows Simplot to reduce its contract and match McCain’s lower price.
The contracts will also significantly reduce potato acreage in Manitoba.
“The acreage reduction is in the neighborhood of 9.5 to 10 percent,” Sloik said.
Most potato production in Manitoba goes to McCain’s processing plants in Carberry and Portage la Prairie, Simplot’s plant in Portage and the Cavendish Farms facility in North Dakota.
Manitoba producers grew 76,000 acres of potatoes last year. A 10 percent decline would reduce acres to 68,400 acres.
