Potato Starch Thrives Despite the Pandemic
Potato starches are nature-derived ingredients with strong water binding properties which makes them a perfect fit to both meet the consumer trends and bring the needed functionality to a wide variety of applications, such as convenience and dessert mixes, meat and meat alternatives, culinary sauces, cereals, processed cheese, pasta, bakery and confectionary.
Consumer behavior is continuously changing and is the main driver for evolving food demand. The strong preference for label-friendly ingredients, growing interest in plant-based foods, alongside the increasingly dynamic lifestyle stimulates innovation and with it, the demand for potato starch.
Potato specialists from Cargill, Agrana and Sveriges Stärkelseproducenter (Lyckeby) shared with Potato Business Digital some of the recent challenges the potato starch industry faces and the drivers behind current trends.
COVID-19 Hot Potato
The HORECA sector and its supplying industries have been severely affected by the COVID crisis, with potato storages quickly filling up as processing demand plummeted.
“Due to the COVID pandemic, people are eating out less, which has impacted demand for potato-starches. We have noticed a volume decrease from manufacturers, such as spice blend manufacturers, who serve restaurants and a volume decrease from wholesalers who sell directly to restaurants. Sales into convenience foods, such as soup mixes, have been very strong as consumers look to carry additional stock in case of having to quarantine. A decline in industrial output also led to a drop in starch demand for packaging,” says Fiona Barnett, Cargill business development manager, Food Starch Europe.
While farmers and store owners found themselves with a huge surplus of potatoes that they were unable to find a market for when the processing demand collapsed, starch factories were not able to relieve much of that pressure, contrary to what many had hoped.
“The starch industry has not been able to receive extra raw material due to lack of capacity,” Mathias Samuelsson, sales and development director, Sveriges Stärkelseproducenter explains. “To be able to process extra amounts of potato starch there also needs to be a higher demand from our customers. The industry doesn’t have the ability to process starch just for storage, there needs to be an increased movement from producers to customers which can be difficult to plan on short notice.” However, not all starch processors felt the same pressure, as Tatjana Figl-Wolfsberger, head of marketing, AGRANA Starch points out: “In Austria, the surplus quantity was not as high as in regions such as the Netherlands, Belgium or Germany, where the production of French fries is stronger. Therefore, the pressure was manageable and there was no reason to restart starch processing in our AGRANA factory in Gmünd in spring.”
You can read the rest of this article in the Autumn Issue of Potato Business Digital magazine, which you can access by clicking here.