McCain buys fewer N.B. potatoes

McCain Foods Ltd. is cutting the volume of potatoes it buys from New Brunswick farmers by 20 to 30 per cent, citing poor economic conditions.

The move could mean a loss of about $15 million in farm sales, says Joe Brennan, chairman of Potatoes New Brunswick.

The potato industry generates about $1.3 billion for New Brunswick's economy every year.

McCain, based in Florenceville, N.B., is the province's largest potato buyer, said Brennan.

About half of New Brunswick's potato farmers have direct contracts with the company, but even growers who don't have direct contracts will be affected, he said.

'The impacting [goes] right down the supply chain — I mean the fertilizer dealers and the fuel dealers and the labour force.' —Joe Brennan, Potatoes New Brunswick

"They supply those growers seeds and other things. And the impacting [goes] right down the supply chain — I mean the fertilizer dealers and the fuel dealers and the labour force."

Some farmers are looking at switching to other crops, such as grains, but those crops' prices are variable and farmers would still be running a risk on profits, Brennan said.

McCain Foods still has potatoes left from the 2009 season, said spokeswoman Calla Farn.

"There's softness in U.S. consumption, there's a high Canadian dollar, there's a low cost of raw potatoes in Europe — they've all had an impact on the current situation," she said.

Last month, McCain also cut the volume of potatoes it buys from P.E.I. farmers by 20 to 30 per cent because of a falling demand for french fries and a tough economy.

At the time, P.E.I. Agriculture Minister George Webster said the 12 potato processing growers who were dropped will have to find other markets, sell their potatoes on the fresh market or get out of the potato industry.

McCain's makes about a third of all the frozen french fries produced in the world, according to the company's website.