HZPC Holding is at home across the globe. We sell seed potatoes on every continent. HZPC and STET varieties are grown and traded in all four corners of the world.


Europe

In Western Europe, the growers had to deal with a high degree of drought over the past year. It was dryer than it has been since 1976. This applied, in particular, to the Netherlands, Flanders, Northern France, Denmark and Germany. Yields were low across the board, but the consequences varied significantly per region. The consequences were harshest where growers could not, or would not, irrigate.

The drought affected the quality of the seed potatoes – the seed potatoes were much smaller and the external quality was lower than usual. The drought also led to lower yields and scarcity.

At that moment, as the market leader, we had to set prices. On average, these ended up a quarter higher than in previous years. The market prices were frequently substantially higher. We also drastically adjusted our logistical plans. With the flexibility of our growers and organisation, and with the understanding within the chain, the scarce products were fairly shared out. Ultimately, HZPC found satisfactory solutions for its customers.

The overall yield per hectare last season in Europe was lower than HZPC’s usual levels. We did succeed, however, in selling the majority of the product for a great price as seed potatoes.
 

‘We set the prices very carefully. We also rely on the customers’ trust when sharing out a scarce product’
GERARD BACKX, CEO


 

Russia

In the past year, sales from HZPC in Russia were excellent. As a result of political developments, however, it is becoming increasingly difficult to obtain permission to import seed potatoes and mini-tubers.
Russian conditions and inspections are getting stricter and we can assume that the Russian borders will be completely closed to seed potatoes in the future. This means our business model must be adapted. HZPC has opted for a strategy whereby it produces more seed potatoes in Russia.

This autumn, we will decide if we want to produce mini-tubers in Russia and to breed our top quality material there too. In Russia, there is a demand for good varieties from both the fresh market and the processing industry.

Africa and the Middle East

As a result of the drought in Western Europe, fewer seed potatoes were available last year for export to North Africa and the Middle East. Nevertheless, trade was buoyant, with the usual proviso that sales in some countries are inhibited by political instability.

In Central Africa, the acreage for potatoes is expanding. In Tanzania, HZPC has a project focussing on Research & Development and market and chain development. In addition, trials are being conducted with hybrid potatoes.
 

North America

As a result of a long winter and drought across a large part of North America, the growing season was shorter, and the production of seed potatoes was slightly less successful, than expected. The largest potato growing area in Canada, Prince Edward Island, had to face the same dry, hot conditions as Europe.

HZPC has been collecting and analysing knowledge from the consumer market in North America for several years now. Whereas potatoes are often regarded as a bulk product, we try to position ware potatoes as a speciality product in both the food-service (out of home consumption) and the supermarkets. We provide inspiration and ideas in this context, for the introduction of new concepts.
 

South America

In South America, licensed growing is particularly successful. The processing industry is expanding and has high demands. With our modern varieties, we are gaining a foothold and making progress within the fresh market. Looking at the political and economic context, Argentina is going through a particularly difficult period at the moment. Inflation is exceptionally high.
 

China

The population in Asia is expanding rapidly and levels of disposable income are rising. In China, HZPC has been successfully introducing varieties to the expanding processing industry for the past few years. Our varieties have been extremely successful. There is a huge demand for varieties with greater practical value than the existing free varieties. We are able to set ourselves apart in this context.

In the fresh market, there is also a high demand for new varieties, which match modern buying patterns and food consumption. Together with strong partners, HZPC is significantly scaling-up its seed-potato production with the varieties in China. We have realised that there are parties in China that are appropriating our varieties and breeding seed potatoes without our consent. We have to be very careful in this market with regard to our intellectual property. HZPC will take action in the event that our varieties are used unlawfully.

As a company, we have taken controversial legal action against a Chinese company. HZPC won the case at the International Court of Arbitration in Singapore. The other party had to pay damages.
 

India

Results were disappointing for the second successive year in India. To begin with, we thought that the year would turn out better but, at the last moment, a segment of the market in the east of the country, in West Bengal, completely collapsed.

This area in India is a volatile market with a huge number of small growers and traders. As a result of disappointing sales of ware potatoes, farmers put their stocks of ware potatoes back in the ground. The demand for seed potatoes thus stalled, prices tumbled, and stocks remained unsold. This was a substantial financial burden for the Mahindra-HZPC joint venture.

Nevertheless, Mahindra-HZPC will not be halting its activities in India. There have also been positive developments. At the moment, we are producing many local varieties. Over the coming years, we will switch to our own varieties. Mahindra-HZPC has obtained protection in India for the introduction of a few top quality varieties. This gives us the opportunity to increase propagation rapidly; from 500 tons at the moment, to 15,000 tons in 2023.

Mahindra-HZPC already has many orders for the coming five years. The demand from the processing industry continues to increase significantly. Producers of crisps and fries provide purchase guarantees and this offers a degree of certainty.