Emsland-Stärke GmbH in Emlichheim has paid potato farmers more money than originally planned for last year’s harvest. The Group is hoping for enough rain in the coming weeks to ensure that this year’s harvest will also be a good one.
Emsland-Stärke GmbH saw out the 2016/17 fiscal year in a better than expected position. The Group, headquartered in Emlichheim, is therefore in a position to pay farmers more than had been agreed upon for potatoes delivered last year. The Emsland Group wants to strengthen its foundation with this retroactive increase in raw material prices. According to a press release, this applies both to the quantities contracted by Emsland-Stärke GmbH, which makes potato starch, and by its subsidiary Emsland-Food GmbH, which produces potato flakes.
In total, the Group is now planning to pay “significantly more than 80 euros per tonne” for potatoes purchased on contract last year. This amounts to a good 15 euros more than the previous year, where the increase is accounted for in equal measure by a higher starch content and a price increase. In the case of the potatoes for Emsland Food, due to additional quality requirements and longer storage periods, the price hike is higher still, with a reported increase of a further 3 euros. In addition, the Group intends to pay a dividend from the company’s profits, following a resolution passed by the Annual General Meeting in January. The amount of the distribution is to be fixed in December. “In this way the company is helping to compensate for the steady rise in the costs of potato farming.”
Altogether, the Emsland Group was able to increase the volumes purchased by contract for the current growing year, 2017, mainly in the flake and granulate sector, for the third year in a row. “The company is satisfied with this development and thanks its producers, who are also the owners of the company, for this positive trend.”
Summer too dry in western Germany
According to the company, potato growth in 2017 has been varied. In contrast to cultivation areas in the middle and east of Germany, where the potatoes are mostly doing well, stocks in western Germany have suffered from a long-lasting drought that has only been interrupted in recent weeks by the arrival of rain. “The weather from July to September will play a decisive role in answering the question of whether the plants will be able to make up the lost ground in their development,” the group reports.
A disappointing sub-par harvest would exacerbate the market situation. European inventories of potato starch, potato starch products, flakes, and granules are low – and that has been accompanied by an increased demand for potato products. In order to meet this demand, the Emsland Group is working to expand its raw material base. “Potatoes are very attractive in comparison to other cultivated crops and should offer an interesting economic opportunity, particularly for newcomers.”