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A Fresh Take on Potatoes and Onions

What variety and innovation look like for two stalwart staples
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In this roundup of potato and onion-themed trends, we take a look at new varieties and fresh spins on old favorites, plenty of grab-and-go produce launches, and a host of integrated marketing tools. We explore the special love consumers have for these time-honored favorites and how industry segments are capitalizing on the amazing versatility of potatoes and onions. Each remains a distinctive and essential ingredient in countless dishes, from traditional to exotic, in cuisine across the globe.

Potatoes
In the United States, which ranks fourth in world production, potatoes represent a $3.75 billion annual industry. The state most commonly associated with potato growing is, of course, Idaho. Roughly one-third of the nation’s acreage dedicated to potatoes can be found in Idaho, known for its rich, volcanic soil and optimum high-altitude climate of warm, sunny days and cool nights.

Smaller Crop, Better Quality
For 2017, planting in Idaho was down a little less than 5 percent, to just under 308,000 acres, according to Travis Blacker, industry relations director for the Idaho Potato Commission in Boise, ID.

Yields were expected to be smaller than last year, mostly due to cooler than average temperatures at the beginning of the season. Despite less product, however, Blacker says the “quality looks good” for the current crop.

Ralph Schwartz, vice president of marketing at Potandon Produce in Idaho Falls, echoed Blacker’s assessment. Schwartz says 2016-17’s potatoes were “plagued with quality issues, especially from the storage crop (March through July),” but the 2017-18 crop is “dramatically improved.” Regarding the effects of weather, he also noted that hotter than normal temperatures during the summer contributed to “a smaller set,” namely, fewer potatoes on each plant.

In Wisconsin, third behind Idaho and Washington in production, a high quality though statistically smaller potato crop was also the case. Dick Okray, president of Okray Farms in Plover, said the grower-shipper usually plans for annual yields around 1 million hundredweight, of which typically 750,000 hundredweight is stored for marketing year-round. Despite “a good looking crop,” Okray anticipates a 10 to 12 percent reduction in tonnage for the season.

Pricing & Varieties
The general forecast by industry analysts for a tightened supply in the fall was expected to result in more favorable prices for growers across the board. Although continuing to dedicate the majority of their acreage to popular russet varieties (the most widely used potato in foodservice, responsible for more than half of all U.S. potatoes sold), Idaho growers have also been planting more reds and yellows each year, according to Blacker.

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In this roundup of potato and onion-themed trends, we take a look at new varieties and fresh spins on old favorites, plenty of grab-and-go produce launches, and a host of integrated marketing tools. We explore the special love consumers have for these time-honored favorites and how industry segments are capitalizing on the amazing versatility of potatoes and onions. Each remains a distinctive and essential ingredient in countless dishes, from traditional to exotic, in cuisine across the globe.

Potatoes
In the United States, which ranks fourth in world production, potatoes represent a $3.75 billion annual industry. The state most commonly associated with potato growing is, of course, Idaho. Roughly one-third of the nation’s acreage dedicated to potatoes can be found in Idaho, known for its rich, volcanic soil and optimum high-altitude climate of warm, sunny days and cool nights.

Smaller Crop, Better Quality
For 2017, planting in Idaho was down a little less than 5 percent, to just under 308,000 acres, according to Travis Blacker, industry relations director for the Idaho Potato Commission in Boise, ID.

Yields were expected to be smaller than last year, mostly due to cooler than average temperatures at the beginning of the season. Despite less product, however, Blacker says the “quality looks good” for the current crop.

Ralph Schwartz, vice president of marketing at Potandon Produce in Idaho Falls, echoed Blacker’s assessment. Schwartz says 2016-17’s potatoes were “plagued with quality issues, especially from the storage crop (March through July),” but the 2017-18 crop is “dramatically improved.” Regarding the effects of weather, he also noted that hotter than normal temperatures during the summer contributed to “a smaller set,” namely, fewer potatoes on each plant.

In Wisconsin, third behind Idaho and Washington in production, a high quality though statistically smaller potato crop was also the case. Dick Okray, president of Okray Farms in Plover, said the grower-shipper usually plans for annual yields around 1 million hundredweight, of which typically 750,000 hundredweight is stored for marketing year-round. Despite “a good looking crop,” Okray anticipates a 10 to 12 percent reduction in tonnage for the season.

Pricing & Varieties
The general forecast by industry analysts for a tightened supply in the fall was expected to result in more favorable prices for growers across the board. Although continuing to dedicate the majority of their acreage to popular russet varieties (the most widely used potato in foodservice, responsible for more than half of all U.S. potatoes sold), Idaho growers have also been planting more reds and yellows each year, according to Blacker.

At Okray Farms, russet varieties (including Gold Rush, Silverton, and Norkotah) also dominated, comprising 88 percent of the total crop. The remainder was split between Red Norlands and Yukon Gold yellow flesh potatoes, as well as a very small fraction of newer or experimental varieties such as Mercury russets and Toscana yellows.

In the Red River Valley growing region of Minnesota and North Dakota, the emphasis remains on the cultivation of red potatoes. The area is the world leader in production of reds, which have been bucking the nation’s overall downward trend in consumption. The attractive, waxy potatoes, which hold their shape and color when cooked, have proven to be a favorite especially among chefs and restaurateurs.

In addition to dominance in red production, the area was showing gains in yellow potatoes as well, which represented 21 percent of the 2017 fresh crop, up from just 13 percent in 2015 according to the Northern Plains Potato Growers Associa-tion in East Grand Forks, MN. The gain was attributed to rising consumer demand.

Ups & Downs
Folson Farms, a 1,600-acre operation headquartered in East Grand Forks traces its involvement in red potato production back more than a century. Bryan Folson, general manager, remained excited about the color and quality of his 2017 crop, 95 percent of which was Dark Red Norland. He also noted that demand for Folson’s products (the company ships primarily to the southern and southeastern United States) was fairly stable.

For Folson, one of his constant business challenges is coping with unpredictable weather. Another not inconsiderable challenge was keeping current with requirements for the Food Safety Modernization Act.

Virtually all produce growers and shippers can relate to these concerns. For Okray, though, another shared concern looms even larger: “Without a doubt,” he says, “you’ll hear a common theme around the industry and that’s the challenge of finding and maintaining a good labor force.”

“The human element,” as Okray labels this piece of the produce puzzle, remains a fundamental stumbling block for growers, packers, and shippers. With the labor shortage dire in his area (the Midwest), Okray Farms responded to the crisis by completing a $2 million facility upgrade. The capital investment was spread across several key areas, involving TOMRA graders, multilocation touchscreens, and other state-of-the-art equipment to speed up handling and sorting processes.

Despite the ag labor crisis and a variety of other challenges facing potato growers and shippers, one trend boding well for the future was the rise of exports. For the July 2016 to June 2017 marketing year, exports hit a record of $1.75 billion according to Potatoes USA.

A weakened dollar as well as shortfalls in production in other regions of the world were among the factors contributing to the rise. The export total represented approximately 20 percent of all U.S. potato production, or 71.8 million hundredweight of potatoes (frozen and dehydrated potatoes together accounted for 84 percent of this figure).

Onions
Today, the United States is the world’s third leading producer of onions, behind China and India. Washington, California, and Idaho/Eastern Oregon lead the nation in planted acreage. Of the three, the largest producer of processing onions by volume is the region of southwestern Idaho and eastern Oregon, at 1.7 billion pounds in 2016, according to the National Onion Association.

PAST & PRESENT:

The cultivation of potatoes began as early as 8,000 B.C. with the rise of pre-Incan civilization, in what is now known as Peru. Potatoes were valued as a dependable food source during those earliest of days and for numerous uses, including as a measurement of time.

The staple vegetable has indeed stood the test of time: it is commercially produced today in over 100 countries worldwide, and reigns supreme among all major food crops for providing the most food per units of land and water used.

What’s more, Peru continues to play an important role in potato growing and research, leading Latin America in production and, significantly, housing the International Potato Center in its capital city, Lima. In addition, the surrounding Andean highlands are home to a staggering 4,000 varieties of native potatoes.

Like potatoes, the appeal of onions continues to be strong as well, and “Onions are everywhere”—says the National Onion Association, based in Greeley, CO. Alas, the assertion can hardly be questioned as flavorful onions (whether yellow, red, or white) are universal in their appeal.

A dietary staple since prehistoric times, onions originated in Central Asia. By the Middle Ages, they had become one of the three main vegetables consumed by Europeans; they were also planted by Pilgrims shortly after setting foot in the New World (though wild onions were already prevalent throughout North America).

Following near break-even prices for growers in the 2016-17 season due to higher yields and sizes, 2017-18 appears to hold better pricing prospects amidst a smaller crop. John Vlahandreas, national onion sales manager for Wada Farms Marketing Group, LLC in Idaho Falls, says summer growing conditions were not ideal due to “too many heat units and not enough cool nights.” Nevertheless, the quality of the crop is not questioned and should be able to meet the season’s high demand.

Remaining profitable as a producer and packager of onions is a constant concern. Wayne Mininger, executive vice president of the National Onion Association, was quick to point out that onion growing and selling occurs among what he characterizes as a very globalized community.

In 2016, Mininger witnessed “a global oversupply like I haven’t seen in 40 years.” Since then, production has tempered and growers in the United States have made slight modifications to their plantings.

Innovative Packaging
Wada Farms was among many businesses working hard to remain on the cutting edge in terms of marketing and packaging, a key focus throughout the onion and entire produce industry.

While Vlahandreas acknowledges “there isn’t much you can do with the onion on the fresh side that hasn’t already been done,” Wada Farms is continuing down the path of innovation with a number of alterations.

Among the changes are reducing in-store pack sizes, working in tandem with grocers to make displays more enticing, and accommodating the changing needs of foodservice and retail buyers. Linear packaging of onions via its multiple-size Medallion sleeve pack, resulting in easier stackability and visual appeal, was one example of the approaches Wada Farms and other suppliers were taking to keep offerings fresh and attractive on supermarket shelves.

Packing to specialized wish lists from retailers, foodservice, or consumers, there are a wealth of packaging options. From sleeve packs, three-pounders, Euro boxes, smaller-sized easier-handling bulk bags, or cartons, each can not only drive sales but minimize product damage and waste. The shared goal by everyone in the supply chain was, in Vlahandreas’s words, “to make the onion more appealing” and “to treat it as we would an apple.”

Challenges
Against this backdrop, U.S. producers are moving into a new reality of compliance and food safety with the implementation of new FSMA rules. “Life is not getting simpler,” remarks Mininger, referring to both increased regulation and the industrywide difficulty of finding legal, consistent, seasonal help.

Vlahandreas sees increased automation as the key to solving the labor issue. Adding to the cost of doing business are rising fuel and fertilizer prices. Another segment, transportation, is also under the microscope, particularly in light of last year’s hurricanes and the impact on shipping and delivery.

“The hurricane relief sidelined many trucks from the daily hauling schedule,” observes Potandon’s Schwartz. And in addition, he notes, “with the new electronic logger rules, it will compel the industry to improve our turnaround times at shipping point.”

For John Parr, founder and managing member of Fresh Start Marketing, LLC in St. Louis, MO, securing trucks is often daunting and “harder than it used to be,” he contends, surmising this is probably due to the higher costs incurred in the movement of produce. While there is no sure solution to the problem, he nonetheless remains optimistic about Fresh Start’s position in the industry. “Our business is growing a little bit every year,” he shares. “We’re having fun, and everyone’s making money.”

Merchandising the Future
The research and development of new herbicides and pesticides was yet another factor in play. “Diseases don’t go away and are perennial in the onion industry,” comments Mininger.

Complicating the yearly battle to keep crops healthy are that new active ingredients, called AIs, take upwards of a decade to develop, with an average cost of more than $250 million according to a 2016 study for CropLife America. In the meantime, grower-shippers are trying to make a living from a crop selling for “generally the same price as 30 to 40 years ago,” observes Vlahandreas.

On the positive side, as Kim Reddin, director of public and industry relations for the National Onion Association, points out, onions remain a central part of most Americans’ diets. “People are not going to stop eating onions,” she asserts. Instead, what will change is “the mix of business, with lines blurring between the grower, retailer, and consumer,” she says, believing meal-kit services, grocery delivery, and other on-demand platforms and technologies, as they take root or continue to evolve, will change the commercial landscape from beginning to end.

Harris Cutler, president of Race-West Company in Clarks Summit, PA, also recognizes the need for produce specialists to adapt to ever-changing economic and technological realities.

“Traditionally, we’ve stayed in the background and allowed our retail customers to handle all communication with end users. Clearly, that’s their space,” he notes.

However, in today’s new more interactive environment, Cutler says, “We’re beginning to engage with consumers.” This interaction can take many forms, he explains, from adding more varieties, choices, and flavor to what he terms as “flawless packaging” that can keep items fresh longer and offer convenience.

Accordingly, Cutler says Race-West is rolling out “innovative new culinary approaches to meal preparation” while still providing plenty of value through bulk bin programs and low-price options for shoppers. Overall, though, for produce businesses to succeed, he believes in a very simple mantra: “Companies must listen to the customer.”

Mininger looks at success and the future in a different way, citing retail behemoth Amazon as one to watch. As a business delivery innovator, he believes everyone along the fresh produce supply chain should pay close attention. “All of us need to keep our eyes open, ears open, and look for those niche opportunities.”

End Notes
As the produce industry evolves to meet the ever-changing needs of consumers—growers, shippers, retailers, and trade associations will continue to do what they do best—stimulate new marketing opportunities while promoting the high quality, availability, variety, affordability, and health benefits of potatoes and onions.

 Image: Iakov Filimonov/Shutterstock.com 

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