Potato processing is actively developing in Russia today. Among the most popular types of potato processing products, frozen fries, crispy potatoes, chips, dry mashed potatoes can be distinguished.
The processing industry requires potato varieties with a dry matter content of 25% or higher, and for uninterrupted industrial processing – in the required volumes and different maturation periods. In Russia, a still insignificant part of the harvested volume of potatoes is currently processed – no more than 15% of the gross yields.
Potato processing products have a higher price and are also stored longer, which makes it possible to offset the losses characteristic of fresh products. Each processed product has its own market, different from the market of table potatoes. At the same time, these markets are less susceptible to seasonal price fluctuations and pressure from importers. There is a positive trend in the growth of potato processing volumes. Thus, in 2018-2022, the production of processed and canned potatoes increased 1.5 times, reaching 371.9 thousand tons by 2022.
According to the results of 2022, the largest volume in the structure of processing falls on potatoes cooked (peeled or boiled in vacuum packaging) – 52%, while imports satisfy more than 25% of the volume of the Russian market. Experts of the company "GC Interagro" confidently say that there is a significant potential for Russian producers in this segment of potato processing. Even now, this product is not something new for the consumer, it is in demand because it is convenient to use and saves time on its cooking.
The lack of the necessary volume of high-quality seeds forces farms to import expensive foreign varieties with the highest output from 1 ha of sown area and consistently high marketability.
Frozen potatoes take up over 33% in processing. In 2018-2022, its production increased significantly, reaching 125.3 thousand tons by 2022. The largest consumption of frozen potatoes in the HoReCa segment. The main limitation of the market is the lack of a sufficient number of products of proper quality, as a result of which the raw materials for the production of French fries are imported in significant volumes. At the end of 2022, Miratorg announced plans for construction in 2023. a factory for the production of frozen French fries and potato slices with a volume of at least 90 thousand tons per year. The plant is scheduled to be launched in 2024.
In the global frozen potato market, the market volume is expected to increase at an average annual rate of 4.6% over the period from 2023 to 2030, according to The Insight Partners. The volume of the global frozen potato market was estimated at US$ 65.1 billion by the end of 2022. The market volume is expected to reach US$ 92.6 billion by 2030. The main drivers of the market in the forecast period will be the growth of consumer awareness of a relatively healthy lifestyle and rational nutrition, the desire for convenience of food consumption, the growth of consumption of ready-made food.
In the segment of high-level processing of potatoes, the greatest demand is now observed for dried potatoes, flakes with significant export potential, as well as potato starch. These types of products are used in the food industry as the main semi-finished product for many types of food, as a result of which the demand for them is traditionally high. Thus, the production of dried potatoes for 2018-2022 increased 1.9 times to 19.8 thousand tons by the end of 2022. The production of flour, flakes and granules for the period 2018-2022 increased by 28%, reaching 34.8 thousand tons by the end of 2022. Large agricultural companies are installing their own lines for processing fresh potatoes in order to increase the profitability of the final product and distribute demand more evenly throughout the year. The production of inexpensive chips, snacks and instant products from dried potatoes is expanding. The growth of export supplies and the reduction of imports of dried potatoes contribute to the expansion of domestic production.
The global dried potato market was estimated at US$ 5.71 billion in 2022 and is expected to grow from US$ 6.02 billion in 2023 to US$9.68 billion by 2030, showing an average annual growth of 7%, according to Fortune Business Insights. Dried potatoes have excellent taste qualities, flexibility in use, high nutritional value. The main drivers of the world market of dried potatoes will be a long shelf life, year-round availability of products for consumers, the desire of consumers to buy convenient food, widespread use in the food industry in the production of chips, snacks.
Starch production increased in Russia by 1.7 times over the specified period. This market segment has significant prospects for further development against the background of less demanding raw materials and high demand in the industry. To actively increase the production of potato starch in Russia, more raw materials are needed, since there are increased requirements for varieties. In 2021, the construction of a potato starch production plant in the Republic of Chuvashia with a capacity of at least 45 thousand tons of products per hour was announced. The planned volume of investments was 30 mln EUR with a 2-year implementation period. However, taking into account the current difficult economic conditions, the implementation of the project may be postponed to a later date.
In 2022, the global potato starch market reached US$4.5 billion, according to Maximize Market Research. It is expected that in the forecast period 2023-2028, the market will continue to grow at an average annual growth rate of 3.9%. It is projected to reach US$ 5.8 billion by 2029. The growing number of the working population and the increasing demand for convenient food and ready-to-eat snacks are one of the main drivers of the global potato starch market. In addition, the growth of the market is enhanced by the growing use of potato starch in food additives.
Taking into account the volume of production in the households of the population in Russia, there is an oversaturation of the market with table potatoes. The prospects for further development of the potato market in Russia are associated with the increase in industrial processing and export of potatoes and potato products. For comparison, about 50-75% of potato production is processed in the EU countries today. Potato processing provides a guaranteed and understandable sales market, as well as stable prices for producers of raw materials, high profitability and significant export potential for processors.
