Niche items, especially those that are premium-priced, don’t always fare well in a recession. Specialty potatoes, however, haven’t been adversely affected by the economic downturn.
“One of the things that I thought would be affected by the economy was the growth of the varieties — reds, yellows and fingerlings,” said Don Odiorne, vice president of foodservice for the Idaho Potato Commission, Eagle. “But if anything they’ve held strong. I think they’re expanding.”
The U.S. Potato Board, Denver, said in its second quarter report that premium russets, organics, and red skin and yellow flesh varieties experienced double-digit dollar growth year over year.
The recession actually boosted premium potatoes at retail, the board said, because consumers are dining out less often.
Shoppers also took advantage of lower prices by trading up from “mainstream and bargain products” to gourmet items. Retailers responded by increasing the number of premium stock-keeping units by 9%, the report said.
Foodservice, however, gets some of the credit for the growth in specialty items, said Kevin Stanger, senior vice president of sales for Wada Farms Marketing Group LLC, Idaho Falls, Idaho.
“It starts in foodservice,” he said. “Consumers see how something is prepared and how it’s used at a restaurant. It’s like what happened with sweet potatoes. Some restaurant chains are carrying sweet potatoes, and people see how good they are. Then you start seeing it carry over to retail.”
Odiorne said specialty potatoes originally were limited to high-end hotels and fine dining establishments, but they’ve become more common in other segments of the restaurant business.
“We’re seeing it spread to the middle with casual dining,” he said. “It’s not unusual now to see people making mashed potatoes with a combination of reds, yellows or russets.”
Odiorne said chefs love fingerlings because they can cook them quickly, and their bright colors are ideal for salads.
Despite showing consistent growth, Don Ladhoff, consultant for the board, said specialty potatoes still account for only 2% of the category.
Ladhoff said that value-added products have not fared as well and have “been soft of late.”
That doesn’t affect his long-term view of such products.
“At PMA there were terrific steamable products,” he said. “We’re confident the category — driven by consumers looking for meals on the table in 30 minutes or less and retailers trying to respond to that need — will continue to grow,” he said.
Dick Okray, co-owner of Okray Family Farms, Plover, Wis., said value-added products may represent a small percentage of potato sales, but they also represent an opportunity for the retailer because of the premium nature of the products.
Stanger said that while the value-added concept has taken off in some categories — think bagged salads — it’s been a harder sell for potato grower-shippers.
“There’s some growth there,” he said, “but it’s not big for whatever reason. There’s not the same acceptance with value-added potatoes. It’s hard to get retailers excited and to get them to dedicate the shelf space needed to display them correctly.”
Still, Stanger said some shippers feel obligated to show retail customers a wide range of products.
“We want to be able to offer the full gamut of what’s available,” he said. “Even if the retailer doesn’t want an item, they can see that we’re trying to be forward thinking.”