Simplot Australia wants to further reduce potato prices

Simplot Australia managing director Terry O'Brien has nominated a floor price Tasmanian potato farmers may have to accept to continue growing for the food processor.

Speaking after the company announced the results of price negotiations with potato growers, Terry O'Brien says the company is working closer to a figure of AU$270 a tonne for potatoes [AU$270/ton is about EUR 223/ton or USD 14.17/cwt].

Last season growers received AU$324 a tonne for potatoes [268 EUR/ton 17.05 USD/cwt], and this season that will be reduced to AU$288 a tonne [238 EUR/ton 15.16 USD/cwt], or a reduction of 11 per cent.

Simplot also says it will need between 25,000 and 30,000 tonnes less from Tasmanian growers this season, and some have had their contracts reduced, while others have lost their contracts completely.

Competition from cheap imports and over production are several reasons why the company says prices have been reduced.