June 13, 2016

The Netherlands-based APH Group has partnered with China’s Inner Mongolia Linkage Potato Co. Ltd. for the construction of a potato handling and transport system, and a climate control system for a potato storage complex with the capacity of 140,000 tons of potatoes.

Inner Mongolia Linkage Potato Co. Ltd. already has a joint venture with Dutch company, Farm Frites called Inner Mongolia Linkage Farm Frites Co. Ltd. and located in Inner Mongolia. A new facility here is expected to be completed by August 2017 and will employ state-of-the-art Dutch technology to produce French fries for sale to the top segment of the Chinese market. Farm Frites and Linkage foresee this project being the foundation for an expanded, integrated project within the potato sector, with activity from seed potato production to the distribution and retail sale of frozen potato products.

APH, which supplies solutions along the supply chain in the potato, vegetable, and irrigation industries, has had a presence in China since 2003 through subsidiary relationships in Beijing and Guyuan. The Group is also active in markets in Central and Eastern Europe, Asia, and Latin America, and exports to more than 30 countries.

In January 2015, China announced that it planned to boost domestic potato production and consumption with the goal of making it the country’s fourth largest “grain” after rice, wheat and corn, reports Argenpapa. Beijing’s Ministry of Agriculture plans to expand potato acreage by 150 million mu (10 million hectares, or 24.7 million acres) by 2020 without encroaching upon land currently used for the production of rice, wheat, and corn.

China is the largest potato producer in the world, despite an average potato yield in 2014/15 that was 17 MT/hectare, or approximately one-third the yield seen in the U.S., due to low quality seeds and disease.

Even faced with these headwinds, China’s production of fresh potatoes for 2015/16 is set at 98 million tons – a 3% increase year on year over the 95 million tons harvested in 2014/15 due to increased acreage under cultivation.

PotatoPro reports that the lack of potato processing capacity in China has been a challenge to growth in the industry, but states that the Chinese government is revising its Seed Law which may result in the acceleration of the development of improved potato varieties. Production of processed products however, continues to increase. For 2015/16, the production of French fries in China is expected to reach 210,000 tons, representing a 17% increase over an initial expectation of 180,000 tons as new production capacity comes online

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Lynda Kiernan