Potato growers face viability test as costs and contract prices bite

Britain’s potato growers are questioning how much risk they can carry into future seasons as rising costs, weaker contract prices and years of disruption squeeze confidence across the sector, GB Potatoes has warned.

Scott Walker, chief executive of GB Potatoes, said the industry was facing the cumulative impact of repeated shocks rather than a single difficult season.

The sector underpins more than £4.5 billion of economic activity and remains an important part of UK food security.

But GB Potatoes warned that without confidence and sustainable returns, the industry risks gradual but permanent contraction as growers scale back or leave potato production.

Mr Walker said the potato sector had long been a dependable part of the UK food system.

However, growers, packers and processors have repeatedly faced volatility, uncertainty and sudden price shocks.

While these challenges are not new, he warned that each crisis had further weakened the sector’s ability to absorb further disruption.

The industry has faced repeated disruption in recent years, including Brexit, the pandemic, the war in Ukraine, energy inflation, labour shortages and extreme weather.

GB Potatoes said the combined effect had forced difficult commercial decisions across the supply chain.

Some businesses have already scaled back or left the sector entirely.

The organisation said global and domestic pressures were now converging.

Conflict in the Middle East has pushed up energy and fertiliser costs, while labour and machinery costs continue to rise.

The removal of the Basic Payment Scheme in England has also reduced the financial buffer available to growers.

The loss of BPS has removed a cushion that previously helped many businesses absorb poor seasons, price shocks and rising costs.

Contract prices for potatoes have weakened this year, while tighter margins across the supply chain are increasing pressure on both growers and buyers.

Depressed cereal markets are also offering little alternative income for mixed businesses.

GB Potatoes said the combined effect had left many growers exposed, vulnerable and questioning the viability of the current season.

Mr Walker warned that while cropping commitments for this season were largely in place, many growers were likely to be considering how much exposure they were prepared to carry into 2027 and beyond.

He said experiences would vary depending on market focus and contractual position.

However, supply shocks and rising costs ultimately affect businesses throughout the potato supply chain.

Tighter margins are also affecting buyers, packers and processors, raising concern that pressure on one part of the chain could weaken overall supply security.

Mr Walker said the sector had shown significant resilience over many years, but that “resilience itself is not unlimited”.

Despite the difficult outlook, GB Potatoes said there were reasons for cautious optimism.

This summer, GB Potatoes and the National Potato Innovation Centre will host the GB Potato Summit.

The event will bring together growers, researchers, policymakers and industry leaders to explore how science, technology, policy and collaboration can support long-term profitable growth.

The summit will focus on practical ways to rebuild confidence, including pest and disease control, soil health, reducing reliance on costly inputs and improving links between research, policy and growers.

GB Potatoes said innovation and practical policy frameworks would be central to securing the sector’s future.

Mr Walker said the UK potato industry still had the potential to grow in value.

He said this could be supported by smarter technologies, science-led production practices and changing consumer demand.

However, realising that potential would require stronger alignment between food policy, research investment and supply chain innovation.

Mr Walker said the industry was not facing a single defining crossroads moment.

Instead, he said it was navigating a period of uncertainty in which businesses were having to continually adapt to rising risks and weakening business strength.

Growers would face difficult choices, he warned, but the path ahead was not without hope.

Through decisive action, partnership and innovation, he said the UK potato industry could emerge stronger and better positioned to serve growers, consumers and the wider food system.

Mr Walker said the potato, often taken for granted, could become a wider indicator of the pressures facing British agriculture.

He warned that the coming months would test the sector’s resolve, ingenuity and leadership.

GB Potatoes said the coming period would be critical in determining whether the sector can rebuild confidence or faces further long-term contraction.