Manitoba potato industry fears big losses as companies cut orders

The Manitoba potato industry — from seed producers to those who grow the main crops — is scrambling to adjust to news that the companies they supply are slashing orders, leaving them facing potentially huge losses.

Mark Peters owns Spruce Drive Farms just north of Portage la Prairie, where he grows around 80 hectares (200 acres) of seed potatoes, but calls himself "pretty small" compared to other farms in the province.

Mark Peters:

"I know there's some seed growers that are gonna get hurt a lot worse than others. Definitely some of the larger seed growers, they're going to be probably losing at least CAD 1 million (USD 698,600.00), maybe more, worth of seed that they have in storage that might not have a home"

A seed potato is one that can be replanted to produce a potato crop. Peters sells his to potato growers, who use them to create their yields.

Mark Peters: 

"It was a shock to me, because I was under the impression everything was good. With the weather warming up, we're able to start shipping our seed to the growers."

But just as the wheels were set into motion, they stopped. 

Mark Peters: 

"That started here last week on Thursday. We got a call Friday saying, yeah, we're gonna have to cut our contract with you by half because we got cut by half from McCains."

Seed potatoes are sorted at Spruce Drive Farms on Tuesday. (Courtesy: CBC)

McCain Foods Limited and J.R. Simplot Company are the two biggest buyers of potatoes in the province, using them for a variety of frozen potato products that are supplied to grocery stores. In 2024, Alberta produced 23.7 per cent of Canadian potatoes, followed by Manitoba (21.6 per cent) and Prince Edward Island (20.4 per cent), according to Statistics Canada. 

Mark Peters:

"It's a big part of our economy. There's a lot of money involved in the potato industry."

'Trying to figure out what exactly is going on'

Producers he has spoken to said the cuts in orders range from 10 per cent to 100 per cent, which creates a trickle-down effect.

Mark Peters:

"As a seed grower, that means that now you're going to be stuck with seed that you grew, and that's another pill to swallow. So it's pretty frustrating as a seed grower to try and grow for these that have promised they want this seed, but then when spring comes and it's time to take it now they can't. Their hands are tied too, so it is kind of a messy situation."

It's unclear why the cuts are happening, and whether they're related to the ongoing trade war between Canada and the USA, said Peters. CBC News reached out to a number of potato growers in the Portage la Prairie and Carberry areas, all of whom declined to speak. Peters said that seed producers in the province have started meeting to discuss their options.

Mark Peters:

"We're trying to sort out what to do with the extra … where to ship it, or do we just toss it, or what we're going to do. There's not very many seed growers in the province and we're all on the same team. We don't want to undercut anyone else. So we have to stick to our prices … and we're just gonna see where the chips fall."

Tariff contingency not enough: PCs

Jeff Bereza, the Progressive Conservative agriculture critic and MLA for Portage la Prairie, told reporters Tuesday he's heard from many growers who are worried about the situation and "talking about very heavy cuts."

Jeff Bereza:

"Companies like McCain and Simplot have to look at market conditions, and the market conditions they're looking … at right now have tariffs."

Progressive Conservative agriculture critic Jeff Bereza said the NDP government's tariff contingency plan won't go far enough to support potato and canola growers. (Courtesy: CBC)

Jeff Bereza:

"The trickle-down effect there is, what's it going to do to the staff in those plants? What's it going to do to those people that supply agronomic services?."

Bereza said the CAD 100 million (USD 69,860,000 million) the NDP government has set aside for the agriculture sector as part of the tariff response contingency in its latest budget won't go far enough to support potato or canola growers, who also face tariffs from China.

Jeff Bereza:

"We've known about these tariffs … since before President Trump was elected. It's something that we should have been working on months ago to make sure that we were not at this situation that we're in right now."

Agriculture Minister Ron Kostyshyn said he's scheduled a Friday meeting with Keystone Agricultural Producers. In a statement, the minister accused the PCs of "playing politics" and said the provincial government is committed to using a "Team Canada" approach to tackling the issue.

Ron Kostyshyn:

"We will continue to work with the federal minister to develop exceptional changes to ag programs, and we will work with all producers facing market uncertainty."

Keystone said in an email Tuesday that it won't comment because it's currently in negotiations with the processors. Peters said he hopes seed producers have a better idea of their situation in a couple of weeks, once the growers figure out what varieties they want and how much they intend to plant this year.

Jeff Bereza:

"I hope things get figured out here sooner than later. Spring is just around the corner, so it's going to hit us really quick here. It would be nice to know what we're doing."