Frozen French fries are the United States' most important potato export product. Income growth in countries such as China and India, has led to an increase in consumption of Western-type products like French fries.
However, in the short term, the economic downturn is expected to slow demand and slow investments in the potato sector, says a Rabobank focus report on the US potato industry.
"While the short-term outlook for the US potato sector is at best neutral, the long-term outlook for the US potato sector is positive, once the economy improves," said Rabobank analyst Marieke de Rijke.
The US is the world's fourth largest exporter of frozen French fries, after the Netherlands, Canada and Belgium.
"In order to maintain current export levels, it will be key for the potato sector to stand out in quality and customer relationships," said de Rijke.
The US has a strong position in frozen French fry exports due to a high-quality infrastructure, which is strongly desirable for exporting quality potatoes and potato products around the world. Exports have increased because of rising demand from developing regions, particularly Asia.
"The rapid pace at which the number of fast food restaurants in Asia is growing will continue to accelerate demand for frozen French fries in this region," said de Rijke.
Contrary to Asia's increased potato appetite, US potato consumption peaked about a decade ago. Potatoes were thought to be calorie-loaded and some fad diets gave the potato a bad reputation. ‘Watching carbs' and healthier lifestyles meant consumers started to favour rice over potatoes as a carbohydrate source.
In an effort to appeal to consumers, potato seed companies, as well as growers and processors, are working together to develop potato varieties that are lower in calories and have a higher nutritions value than the current varieties.
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