The output of frozen french fries continues to expand in China, as production is forecast to reach 250,000 metric tons during the 2017/18 marketing year (September to August). This would be up 10% from the previous year, according to a GAIN Report prepared by Abraham Inouye (#N17068) and issued on December 12 by the USDA Foreign Agricultural Service.

Frozen fried potato manufacturing has been advancing steadily in recent years, driven by increasing domestic demand from fast food restaurants and convenience stores. As buyers have strict potato requirements – including shape, starch content, sugar content and color – processors usually contract with farmers to grow tubers that meet specific quality conditions.

Because of anticipated higher domestic production, imports of frozen french fries in the current marketing year are forecast to fall 5% to 120,000 metric tons, compared to 126,620 tons that cleared customs during 2016/17. The United States continues to dominate imports, with a 65% market share in 2016/17, followed by Canada and Belgium, which together accounted for 22% of China’s frozen french fry imports last year.

The import tariff and value-added tax for potato products remained unchanged in 2017 at 13% and 17%, respectively.

As the largest potato producer in the world, China’s 2017/18 fresh potato harvest is forecast at 97 million metric tons, thanks to an expansion of growing area. During the 2016/17 season, output was forecast to increase 3% to 100 million metric tons, but actually dropped 5% to an estimated 92 million. The decrease was caused by continuing drought in the northern growing region, and large-scale late blight occurrences in the southwest.

Meanwhile, industry sources report expanded potato farming area heading into the next planting cycle, due to a decline in corn acreage attributable to China’s recent corn reform measures and because spring potato prices in 2017 were the highest they have been in the last eight years.

The PRC has four main potato producing zones. Sichuan, Gansu, Guizhou, Yunnan and Inner Mongolia are the nation’s largest potato producing provinces, accounting for about 60% total fresh potato production.

Half of all production comes from the northern single crop zone, which includes Heilongjiang, Jilin, Liaoning, Inner Mongolia, Gansu, Xinjiang, Qinghai, Ningxia, Shanxi and Shaanxi provinces. Potatoes grown in this vast area are usually planted in late April to early May and harvested from September through October.