Aseahawkfan wrote:Interesting. I imagine potatoes are like other commodities where the seller and buyer both want to lock in a price in advance to ensure the sale.
Nearly all of the potatoes grown in the Columbia Basin are contracted well in advance. Most of our potatoes we get through joint venture agreements where we partner with a number of very large growers. Some contracts are for 5-10 years. We agree to a fixed price and acreage, participate with them in both the cost of production as well as the sharing of profits that he gets off of growing potatoes. It allows for the purchasing of seed, fertilizer, equipment, etc, in quantity and at a lower unit cost. There's also one, very large corporate farm, owned by the Mormon Church, called AgriNorthwest that supplies us with a huge amount of spuds. There are still a few smaller growers that contract annually, but not many. Most of those contracts are negotiated in January. The little guy needs a signed contract so the bank will lend him money so he can rent the land, prep the ground, buy the seed and fertilizer. Not too many of those growers exist in this region anymore. They can't compete with the larger farms. But I think that Idaho still has a lot of smaller, independent growers.
There are two other processors in the region, competitors of ours, so I'm not exactly sure how they acquire their raw product, but I would have to assume that it's similar to how we do it.
Aseahawkfan wrote:I can't imagine a potato shortage. They're so many of them. And I imagine putting them in bags is probably automated?
Fresh pack does not require a lot of workers, and you're right, there's a lot of automation. What is fairly labor intensive is the processing plants like I used to work at, but they're nothing compared to the meat and poultry packing plants.
We have two plants in Holland, and they would send some of their new hires over here to attend in house classes. One of the sections is raw product, of which I was an assigned mentor for. I would take them to one of our 16,000 ton capacity storages and their eyes would bug out. In Europe, a 40 acre field is huge. Here the average field around 100-125 acres. Same goes with the irrigation systems. They are lots different, no big center pivot systems like we have in this region. We have control rooms where they can monitor the pressure and flow of over 100 center pivot systems with one operator and a couple of chasers, so the labor required to grow potatoes is very, very minimal.
Aseahawkfan wrote:Same with milk. Dairy farms can operate with plenty of social distancing and tons of milk can be generated by a single farmer or two. My grandfather milked an entire heard of cows daily by himself. Just hooked up the milk suckers, made sure they had feed, and pushed them through when gone. 1000 of gallons plus of fresh milk daily pasteurized in a huge tank and shipped out the following day in a truck. Dairy is a very automated business.
Correct. Dairy farms and processing is very automated. Same goes for wheat, rice, and other grains. We won't run out of those commodities.