b'TheWild WestANYONE WORKING IN the potato shipping industry withindemand for more diesel, which means were probably going to the last few years knows its not always easy. Due to a plethoraget more gasoline. We may see lower gasoline prices, but rising of reasons such as COVID-19, a trucker shortage and highdiesel prices, which will have a bigger impact on the supply inflationary prices, shipping within the last two years feels morechain, both for ocean freight but also for tractors and combines. ofPotato Shipping like the Wild West than an easy endeavor.Inflation as well continues to cause prices to rise.Not only has shipping become the Wild West, but its not anOne of the challenges with inflation is when prices are intuitive challenge, either. Shipping processes and policies differperceived to be getting higher, says Michelle Klieger, owner of across the potato sector depending on whether youre shippingStratagerm Consulting, on the same panel discussion on Aug. 17. seed, fresh or processing potatoes. Not only that, but whether orPeople want to buy more before the price gets high and they not its the growers responsibility also varies across Canada. want to hoard and stock upunfortunately, that causes the It varies by growing region, says Dale Lathim, executiveprices to increase even more.director of the Potato Growers of Washington, in a phoneSimilar issues due to inflation are being seen in the interview with Spud Smart. Here in the Columbia Basin fortransportation industry, which is causing prices to continue to instance, we dontas growersdeliver anything to therise. Unfortunately, when it comes to transporting potatoes, the plants. The processors pick up the potatoes at the side of ourprice needs to be paid.field, and they pay 100 per cent of the cost of the freight goingThe problem is, growers dont really have much of a choice, there. However, in other regions, growers actually have to deliverright? says Stamper. They have to move the potatoes. Its not directly to the plant themselves, and hopefully those freight costsa crop that can wait. Its not Oh, well, Ill wait and see what the should be addressed in the contracts. price is going to be next week,retailers are waiting for orders.Part of the point where concern arises, Lathim says, is whenBecause of that, Stamper adds potato growers in some regions regions start comparing contacts without taking differences intohad to absorb the increases in freight costs at the beginning account.of the year when prices increased dramatically in a very short It can be very, very costly to haul potatoes, he adds. time. Fortunately, though prices have decreased somewhat, and Especially as disruptions continue to add to the shipping cost,shipping costs arent on the rise anymore. its important to know the costs and differences of shippingIts calmed down a bit, Stamper says. The prices havent potatoes costs across North America. come down, and wont come down, but its not continuing to increase as availability becomes better. When you cant get Disruptions Continue to Rock the Boat trucks and drivers, inevitably the price is going to go up because When it comes to transportation, disruptions continue to causethey dont have a driver to do the job.issues in terms of availability and cost of freight.According to Truckers Smart, as of Feb. 2022, Canada reported Prices went way up, and there were a lot of factors there,a shortage of some 25,000 truck drivers, while the United States Victoria Stamper, general manager of United Potato Growers ofreported a shortage of 60,000 drivers. In addition, the American Canada (UPGC), explains in a phone interview. Noting differentTrucking Association (ATA) states wages for truck drivers rose sectors showed precursors to difficulties transporting potatoes,significantly in 2021 as the shortage continued. especially in terms of price.The driver shortage, coupled with increased demand for In terms of transporting supply, Barry Prentice, professorgoods in the post-pandemic economy, really drove driver of supply chain management at the University of Manitoba,salaries, Bob Costello, chief economist with ATA, said in a describes the supply chains as one of congestion. release, adding the average driver saw an increase of about 10.9 Weve simply overwhelmed parts of the railway and theper cent in their wages due to driver shortages. trucking industry, he says in a panel discussion on Aug. 17.Theres a series of factors causing the freight increase, Prentice adds the transportation industry has been in a shockStamper says. At the end of the day, growers were asking: How globallyit went from low, essential items only shipping toare we going to recuperate this?resuming business as normal within a year or two after a globalFrom Lathims perspective, the cost has impacted the haul lockdown.price as well.We also have a situation right now where oil prices are veryIt hasnt impacted us on the farm side because we arent high and the system has been short of oil for various reasons delivering the potatoes to the plants, he explains. The major thats causing some rising cost pressures, he adds.impact this year, from a freight standpoint, was the cost to haul in Though gas prices might be seeing a downfall, Prenticeour seedthat was almost 25 per cent over what it had been the cautions freight doesnt run on gasolineits the diesel prices toyear before. Thats quite a haul to bring it in. be concerned about. As costs continue start to stabilize, the potato sector now Equipment for the fields, the trucks, aviation, the ships itslooks to how to move forward in a world of higher-than-normal all run by diesel, he explains. Ive already seen evidence thatshipping prices. In fact, UPGC has started a Think Tank to the diesel price and the gasoline price are going to widen. Whenstudy freight issues involving members across Canada coming you crack a barrel of crude oil, you get a certain proportion oftogether to discuss current issues but also some long-term diesel and a certain portion of gasoline. Were going to have asolutions/alternatives.SPUDSMART.COM Fall 20227'