Saskatchewan’s plan to boost the pro-vince’s potato industry is coming under fire by growers in Manitoba who say government handouts will hurt the industry’s long-term health.
“If there’s an increase in production we can understand it if there’s a market for it, but we have the sense they’re increasing on speculative markets,” said Garry Sloik, who grows seed and processed potatoes under contract for a french fry plant near Portage la Prairie, Man.
“I’m just afraid government money distorts production.”
Saskatchewan plans to beef up production to lure a major processor into that province. At the current rate of growth, that should happen by the end of this year, said Harvey Fjeld, head of the Spudco division of Sask Water.
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The majority of Manitoba’s 74,000 acres of potatoes are grown under contract with french fry processors here. The rest, 6,000 acres, is grown for table potatoes.
Total acreage in Saskatchewan is just over 8,000, but the province wants to raise that to about 20,000 in the short term and 60,000 in 10 or 15 years, Fjeld said. To make that happen, the government is spending $250 million on irrigation infrastructure and paying to build storage facilities to help farmers get started or expand their acreage.
Farmers then pay for irrigation services and can lease the storage facilities.
Saskatchewan farmers primarily grow seed potatoes for export to Ontario, Manitoba and the United States, and that market is growing, Fjeld said.
“Saskatchewan seed is high quality and has an excellent reputation,” he said. “There’s disease in Manitoba. Whenever you get more processing potatoes in a small area you’re going to have more disease.”
Fjeld said Saskatchewan’s support for irrigation puts the province a step ahead of Manitoba, which means more land for potatoes and better yields.
“Our soils and our water are going to give us a competitive advantage, there’s no doubt about it.”
He said Saskatchewan predicts yields for processing potatoes to hit 450 hundredweight per acre, compared to an average of 220 in Manitoba.
But according to Sloik, who is also manager of Keystone Vegetable Producers, production should increase only when there’s demand from the processors or more demand from retail consumers for table potatoes.
Although most producers here grow under contract, they’re vulnerable to a flood on the open market.
“Last year was a prime example of what overproduction can do on the open market. Prices all over North America were disastrously low.”
Processors in Manitoba contract all of what they need, but in areas such as Idaho and Washington, they contract a portion and buy a portion off the open market.
“So when open market prices are $2 in the States like they were for a good part of last year, that puts processors here at a disadvantage and consequently we as growers are disadvantaged as well.”
If some region is hit by a weather disaster, growers will see prices go up.
“But if most areas have an above average or average crop then it’s very easy to flood the market and depress prices of fresh potatoes, which consequently is not good for the processed industry.”
Fjeld said Saskatchewan has a large fresh pack plant that can handle 5,000 acres and can compete with any plant in Western Canada and the U.S. If the province doesn’t get the new processing plant, Saskatchewan producers will still be looking at growing markets for their potatoes, he said.
“U.S. processors are getting ready to move to Canada because our cost of production is better than the U.S,” Fjeld said.
“We see the market expanding someplace and we’ve got the water, the land and producer desire so why not do it here?”
