(3 Minutes Read)
South Africa’s potato industry is facing a major crisis as prices plummet well below production costs, leaving many farmers operating at a loss. The sharp downturn follows a bumper harvest, expanded plantings, and favourable weather conditions that created a supply glut across the country.
According to FreshPlaza, recent fresh produce market prices have dropped to between R3.50 and R4 per kilogram—roughly R2 below the average production cost and nearly 50% lower than the same period last year.
Good yields, a mild winter, and aggressive planting have resulted in significant oversupply heading into October. Several regions increased their potato cultivation this season due to strong seed availability and ideal weather, with Limpopo alone expected to deliver an additional 12 million 10kg pockets between July and December 2025.
Compounding the problem are overlapping harvest periods from multiple production regions, which have flooded the market with excess stock. Potatoes South Africa attributes the price collapse to a combination of increased hectares planted, higher yields, and bottlenecks in distribution timing—factors that together drove supply far beyond demand.
Agricultural analysts forecast that prices will continue to decline through October before bottoming out. FreshPlaza warns that prices could stabilise around R3.50/kg for the remainder of 2025, meaning many producers will continue selling at a loss. FP Coetzee, Potatoes SA’s manager of information and regional services, warned that the situation may force some farmers out of the industry.
“There is definitely a chance that some farmers will not make it,” Coetzee said. “It depends on how your business is structured and whether you have the financial ability to withstand a difficult season. If you didn’t save during the good years, a year like this can certainly force you to stop farming.”
While the crisis poses a serious threat to producers—particularly those burdened by high input costs—consumers may experience temporary relief in food prices. Grow Fresh Produce Agents has urged retailers to pass on the lower costs to shoppers, noting that because most potatoes are consumed fresh in South Africa, there’s limited capacity to store excess stock.
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Looking ahead, industry bodies and producers are now turning their focus to strategies for managing future volatility. These include better coordination of harvest timing, region-specific planting plans, and potential financial hedging mechanisms to protect against further market shocks.
