ORLANDO, Fla. — Meeting at the second yearly Potato Expo, members of the potato industry heard about the challenges they face with declining consumption and changing consumer shopping practices.
 
Bruce Huffaker, editor of North American Potato Market News, told attendees from all sectors of the industry — fresh, frozen and chip — that the recession isn’t necessarily the cause for continuing declining demand for potatoes.

Potato growers face demand-side challenges

Doug Ohlemeier

Ed Schneider (from left), of Schneider Farms, Pasco, Wash., and immediate past president of the National Potato Council, Washington, D.C., talks with Lynn Olsen, president of L.J. Olsen Inc., Othello, Wash., and Tony Amstad, owner of Amstad Farming Co, Hermiston, Ore., during Potato Expo 2010 in Orlando, Fla.

“Unless something changes on the demand side, the clash between demand and the yields we have will force acreage coming out of production on an ongoing basis,” he said during a Jan. 5 session. “The trend in demand going down is going faster than it had been. That’s the scary thing in the long term.”

Bruce Axtman, president and chief executive officer of the West Dundee, Ill.-based Perishables Group, said consumers are trading down to less expensive items within produce categories, are trading out of categories or leaving the fresh department entirely.

“In the produce industry, almost everything is down,” Axtman said. “Retailers have been fairly successful up until recently in driving more dollars without not necessarily driving more tonnage. They’re selling less from a tonnage or volume standpoint, but selling smaller packages and individual offers and convenience-based products that sold for smaller quantities at a higher average retails and increasing retail prices.”

That, he said, has kept retailers performing well in produce during the last few years but has changed during the past six to 18 months.

New products analyst Lynn Dornblaser, director of CPG Trend Insight for the Mintel International Group’s Chicago office, said consumers are becoming more interested simplicity and old-fashioned “comfort foods.”

“It’s all about fresh, fresh and local,” she said. “What we see going on with concept of fresh is that fresh has taken on additional attributes such as natural and authentic, like mom used to make.”