The Costs and Returns of Scottish Potato Production

The gross and net margins for a representative sample of 53 Scottish potato producers classed as "Seed" (>80% of area grown for seed), "Ware" (>80% of area grown for Ware) and "Mixed" for the rest were obtained for the 1999 growing season according to the methodology of MAFF (1990,1999). The farms were arable. Yields were average but for seed growers for whom tuber number in the seed size is more important. Prices were the lowest for six years variable costs were high and gross margins are above the best for cereals. However fixed costs excluding seasonally rented land are considerable leaving negative net margins. Potato price fluctuates widely. Prices were high in 1998. Applying these prices to the 1999 data left good net margins. Average prices still left reasonable net margins. Break-even prices were £85/t for ware and £200/t for seed, which were not reached in three of the last six years. These results show the considerable investment in both fixed and variable costs and risk for this important Scottish crop.