Simplot-Clarebout wants more Innovator and quality

For the first time, Simplot-Clarebout presents its contract prices for the harvest year 2026. The company is clearly launching an attack on the Innovator segment. In addition, a focus on quality is expected to make the difference, among other things with a bonus-malus system. To sufficiently reduce the acreage and to make the market healthy, the company applies a generic volume discount of 25% for most varieties. With a new name, following the acquisition by the American-based J.R. Simplot last summer, comes a new approach for Europe’s largest potato processor. In the past, Clarebout often set the tone by coming out early with their contract prices. This year, the company has started contracting at the end of January, and the contract has a different setup. There is a proposal A and proposal B. The first is for 75% of the volume grown last year. In proposal B, the grower may contract additional volume if desired. Those who grow Innovator can secure 100% of the volume, just like last year. Volume proposal The processor reserves the right to adjust the requested volumes if necessary. Growers are asked to submit a proposal by February 14, after which the buyer has a week to come up with a counterproposal. This is according to the code of conduct from Belpotato. “We hope that growers realize that the acreage and volume need to decrease to make the market healthy,” says purchasing director Yves Capoen. “The current situation can be directly traced back to the large harvest of last year.” Especially for Fontane, a significant correction is implemented. The season starts in early September, with a price of €13.00 per 100 kilos. This is a decrease of €4.50, or 26%. For week 17, the price is €20.75, which is €6.25 (23%) less. Week 26 finally comes to €23.75, which is €5.75 (19%) less. For Innovator, the decrease is smaller. The starting price from the field is €16.75. A decrease of €3.25 (16%). In week 17, the price is €26.25, with the decrease being equally large. Proportionally, it is slightly smaller at 11%. For week 26, the company no longer has an Innovator contract. Delivery ends in early June at €27.50. Season starts 6 weeks later Instead of starting with early potatoes in week 28, the company will begin this year in week 33. Simply due to the large potato stock. However, a caveat for quality remains at this late stage of the storage season. The main harvest of Innovator starts alone in week 33 (August 9). The other varieties begin in September or November (Challenger and Markies). The price reductions are not the whole story for the upcoming season. Simplot-Clarebout introduces a quality system, where growers receive a bonus or penalty on the price, as processors in the Netherlands have long been using. Points are awarded for factors such as dry matter, color, length, sorting, and defects. The ideal specifications per segment are considered. Fast food contributes the largest bonus, with a maximum of €1.50 added to the cost price for Innovator and €1 for Fontane, delivered from storage. If the potatoes fall into the ‘catering white’ category, the bonus is €1 for Innovator and €0.50 for Fontane. From the field, these bonuses are slightly smaller. If the potatoes fall into the ‘retail’ or ‘oven’ categories, a penalty on the price applies. This is equal in magnitude to the bonus. Quality-conscious “We are clearly focusing on quality with the new contract,” explains Capoen. “We want to make growers more quality-conscious. The quality delivered must come first, and only then the volume. That is our message for the upcoming season. The entire sector in Europe has created a situation that is not interesting for anyone. If we want to regain our competitive position, we need to return to acreage – and thus volume – and achieve a competitive cost price. We still see sufficient growth opportunities in the fast food segment, so we are focusing on that. The acquisition by Simplot has also led to a greater awareness of quality.” The seed potato costs are again decreasing, by 17% to 18%, depending on the variety, grade and delivery. For Fontane 35/50 mm, €67.00 per 100 kilos must be paid (whole load, bulk) and for Innovator €71.00. Capoen: “Last year we also let the seed potato prices drop. Adding those decreases together is approximately equal to the current contract price drop.” Those who sign a contract commit to taking the required seed potato volume from Simplot-Clarebout as well. Long-term relationships Simplot-Clarebout’s approach is to offer a contract to every grower who also grew potatoes for the processor last year. Only in exceptional cases will the collaboration be terminated. There is a mileage scale for transportation, but that was already in place. The company is aware that the price reductions are painful for growers, but emphasizes that the pain for the industry is equally significant. “We must get through this together,” believes Capoen. “That is why we choose growers who want to establish a long-term relationship with us. By fighting together, we can hopefully regain our market share. We do not only achieve this by lowering potato prices but also by reducing land and rental prices. Only in this way does sufficient margin arise.”