Spudman February 2023 - 39

A businessman
A businessman
UNITED POTATO
GROWERS OF
AMERICA
Buzz Shahan
Chief Operating
Officer
is someone who
enters an enterprise
that produces a
product, or that
buys and sells
products or services
to make money. For
a businessman to
make money, he
must bring in more
money than he
spends. To make
this happen, the
businessman must operate within certain
economic parameters.
Anyone following the potato production
business for the past half century would
agree that producers operating within
profitable economic parameters was not
always what happened.
From about 1950 until 2004, for every
profitable year in fresh potato production,
a producer could look forward to a year or
two of unprofitability. Staying in business
became the goal during those bad years.
Remortgaging the farm to clean up the
credit line was how it worked. Escalating
land values is what backed operating
lines, not business performance. Had
operating lines depended on business
performance for renewal rather than
escalating real estate, potato markets
would likely have stabilized sooner than
they have.
Before strict parenting became
unpopular, a parent would give an
unruly child a choice: Stop behaving
badly or be punished! Back then, had
banks " punished " potato producers for
poor performance, producers would
have looked more deeply into why
markets failed and why markets
succeeded. Since it was easier to
increase the mortgage than figure out
what was wrong with the market, that
is what happened.
Today, every potato producer knows
that the potato market's supply/demand
balance is what dictates their crop's
value, fresh or processed. Balancing the
supply/demand equation is the basis
for valuing any commodity, be it gold,
diamonds, crude oil, coal, natural gas,
lettuce or potatoes.
Spudman.com 39
Today, every potato
producer knows that
the potato market's
supply/demand balance
is what dictates their
crop's value, fresh
or processed
Key potato producers formed the
United Potato Growers of America to
demystify potato markets. Their research
correlated supply volumes with a crop's
value, what else? This finding changed the
culture of potato production. Consumers
now have stable supplies at great value,
retailers enjoy stable margins, and
producers can modernize their farms and
farming practices, thereby supporting
local and national economies. Everyone
up and down the potato supply chain is
now on solid footing.
It's hard to imagine anything more
comforting or more rewarding to a
businessman than to operate his
business within fair return data. In terms
of potato production, one's parents and
grandparents never had that opportunity;
they fought it out in an information
vacuum. Today's potato producer does not
have to do that. Today's potato producer,
operating within knowable production
parameters, can build equity year after
year, still providing the American consumer
with unmatched value for each food dollar
spent. This is something that must not be
taken for granted.
Second to matching production to
demand is keeping potatoes on top of
the nutrition-per-consumer-food-dollar
pyramid. Today's potato producer finds
himself surrounded by support systems
that make this happen; Potatoes USA is
doing excellent work, so is the National
Potato Council, and so are the United
Potato Growers of America. As a producer,
be thankful for these support systems, and
do your part to keep them operating as
they do.
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Spudman February 2023

Table of Contents for the Digital Edition of Spudman February 2023
