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What makes a potato processing powerhouse?

With a focus on Canada’s role in the North American and global economy sharper than ever before, those outside of Canada’s borders have begun to take notice – if they haven’t already – of Alberta as oil country. It’s well-known to Canadians, and beyond, that it is home to one of the largest oil reserves in the world.

But it could just as easily be referred to as Canada’s potato capital.

In 2024, Alberta produced about 30 million hundredweight (cwt) of spuds, according to a Statistics Canada report released in December. That topped every other potato producing province including P.E.I. (25.9 million cwt) and Manitoba (27.4 million cwt). In fact, Alberta’s 30 million cwt accounted for 23.7 per cent of the potatoes produced in the country this past year.
Alberta’s booming potato sector is big business, according to a recent report produced by Alberta-based agricultural consulting firm Serecon Inc. on behalf of the Potato Growers of Alberta (PGA). The Alberta Potato Industry: Growing Success in 2022 says the province’s potato industry contributed $2.87 billion to the Canadian economy and $2.31 billion to the Alberta economy in 2022. That included $662 million in labour income and 9,390 jobs in Canada with some 7,380 jobs in Alberta. Those numbers have continued to climb since.

One of the key factors driving this boom is the province’s potato processing sector. That should come as no surprise considering 73 per cent of the potato acres in Alberta are grown for the processing of frozen potato products and potato chips, according to the PGA report.

And that boom is expected to continue. Cavendish Farms opened a new frozen potato processing plant in Lethbridge in 2019 that tripled the company’s production capacity and requires more than 735 million pounds of potatoes annually. Meanwhile, McCain Foods is putting the finishing touches to a $600 million expansion of its processing facility near Coaldale. It is the company’s largest ever capital investment. It is expected to be completed by June 2025 and will require another significant boost in potato production in the province.

Potatoes in Canada recently spoke with a group of industry experts and analysts about the boom in the potato processing sector, the reasons for it and what it has meant for producers. Here’s what they had to say:

What’s behind the boom?
What has been driving the boom in Alberta’s processing sector?

Darren Haarsma, a principal with Serecon Inc., says one of the primary factors has been the growth in the frozen potato product market in Asia. That has increased export opportunities for potato producers in the U.S., particularly for those in the Pacific northwest. As a result, U.S. domestic availability has decreased which has increased export opportunities for Alberta producers to the States.

“U.S. domestic availability, production minus exports, has been decreasing even though the U.S. population has been increasing.

As a result, you’re seeing that Alberta’s and Canada’s production has been backfilling (that supply),” he says.

Good for growers
The growth in the processing sector is reflected in the fact that the number of planted acres of potatoes in Alberta has been steadily increasing over the past decade. In 2014, the number of potato acres in the province was at 56,000. By 2019 that figured jumped to 62,000 acres when the Cavendish Farms plant expansion came online. In 2023, the number of planted acres sat at 80,000, which produced the province’s largest potato crop ever.

One of the biggest beneficiaries of this growth has been potato growers. Not only has it allowed many existing producers to expand their operations, but it has also enticed some farmers who never grew potatoes before to give it a shot.

“We’ve added some new growers over the last couple of years and we’re going to add some more with this (McCains) expansion, so it’s been good that way,” says PGA executive producer Terence Hochstein.

“People that have been wanting to get into the industry and have done their homework and got their financing in order, now with the expansion, it’s allowed them to come online. It’s not been that all the growth is from within. It’s a good opportunity because of the boom.”

All of this increased demand for potatoes and potato products has also been good for Alberta’s seed potato industry, Haarsma says. About 60 per cent of the seed potato that comes out of Canada is exported out of Alberta and into the U.S., meaning there are greater export opportunities for Alberta seed producers due to the increased demand.

Why Alberta?
There are more than a few reasons why Alberta producers have been well positioned to take advantage of the increased demand for processed potatoes.

The availability of water, or access to irrigation, has been one of the primary factors. Approximately 87 per cent of Alberta’s potatoes are irrigated, primarily in the southern region of the province.

Coaldale’s 845 Spud Farms primarily sells its potatoes to local Cavendish and McCain plants for processing. Image courtesy of 845 Spud Farms.

Another key reason is the entrepreneurial spirit of producers. The PGA report states that the “strong entrepreneurial drive of farmers” has been a major factor in the growth of potato production in the province. Equally important has been their willingness to work together for the good of the industry, Hochstein says.

“You’ve heard the saying in the U.S. military of leave no man behind? Well, it’s no different here,” he says.

“Everybody is in this together. It’s the communication amongst the growers. There are no secrets in this industry, even though it wasn’t always that way. Everybody wants the industry to succeed so therefore everybody helps each other out.”

Haarsma points out that the study he helped author indicated that the average yield in Alberta is 30 per cent higher than in the rest of the country. He says that higher yield makes Alberta attractive to processors because it means they have fewer farmers and less acres to deal with.

Jonathan Neilson is a research scientist with Agriculture and Agri-Food Canada based in Lethbridge who specializes in potato health. He says favourable weather conditions make Alberta an ideal location for growing potatoes. It gets plenty of warm days followed by cool nights which is important, especially later in the growing season, in helping tubers to bulk up.

Neilson says Alberta is also unique from other potato producing provinces in that it has longer and more diverse rotations. In New Brunswick and Manitoba, potatoes are commonly part of one-in-two-year or one-in-three-year rotations whereas in Alberta they are typically part of a one-in-four-year or longer rotation.

“That (longer rotation) is going to help with your disease pressure. There’s also some soil health building that happens,” he says.

“Plus, we tend to have really diverse cropping systems. I think there are something like 20 different crops that are growing routinely in this part of the country that are sold for either food or processing markets. When you have these longer rotations, and more diversity in the system, that’s going to promote higher soil health and that translates into increased yields.”

Staying the course
Hochstein sees substantial room for the continued growth of Alberta’s processing sector. He’s not alone in that regard. The PGA report states, “there is significant, suitable land … for potato production expansion.”

However, he stresses that in order for that to happen the industry must continue with the methodical approach to expansion that has worked so well for it to date.

“Expansion is great, growing is great. You want to become the biggest or the best or whatever. But with that you’ve got to do it in a calculated way. You can’t jump in half-hearted; you’ve got to be calculated. We’ve very methodically gone about how we’re doing this,” he explains.

Coaldale’s Boston Farms has previously been recognized as a top potato grower from McCain. Image courtesy of Potato Growers of Alberta.

“One of the conversations that we’ve had all along with our processors … is we’re willing to engage and be part of this, but we’re not going to compromise our rotations. We’re not going to take shortcuts. We’re not going to jeopardize the economic practices that we’ve worked so hard on to maintain that quality. It’s been very calculated, very deliberate and will remain so.”

Neilson also sees room for growth in Alberta’s processing sector.

He says one of the limiting factors could be future water availability. Although the province has yet to get into a situation where it hasn’t been able to hit its irrigation targets, he says that could happen at some point if the province were to continue to experience prolonged droughts.

The good news is the Alberta government along with the Canada Infrastructure Bank and eight irrigation districts recently embarked on a $815 million plan to modernize irrigation district infrastructure and increase water storage capacity in southern Alberta.

“That means there could be some opportunity for some additional growth, but it’s not going to be a boom like it has been for the last five or 10 years. You just can’t bring on that much capacity and continue to do that. There’s a limit to everything,” cautions Hochstein.

Ideal qualities
Russet Burbank continues to be one of the most popular varieties of potatoes with processors, according to Neilson, because its well suited for producing French fries.

However, some processors are starting to look at new or different varieties that have a better environmental footprint. Many of those varieties tend to require less water and use less nitrogen, and also possess better processing traits.

While Neilson was reluctant to name specific varieties being considered, he says processors are investigating varieties from several different growing regions including Europe. Some have even started their own internal breeding programs, he adds.
AAFC is currently conducting a study into several new varieties to determine their ability to withstand heat stress. Another study it is conducting is looking at their capability to recover from severe weather conditions including hail. (For more on heat and hail stress in Alberta potatoes, see Page 14).

As for what processors are looking for in a potato, yield remains the number one priority followed by important traits such as size, says Neilson. Size profile is important because French fries generally must be a certain length which requires the potato to be a certain size.

Neilson says shape is another important consideration because processors don’t want any kind of deformities such as knobs, also called heat runners, which could make a portion of the potato unusable. Storability is becoming an increasingly important consideration so that potatoes don’t rot due to disease while in storage or become discoloured when fried.

Future threats
One possible risk to the prosperity Alberta’s potato industry is enjoying is the danger posed by changing climate trends which could lead to new disease threats.

Neilson points to blackleg as an example. While the overall pressure of blackleg remains fairly consistent, the dominant species of it appears to be changing, one of which appears to be better adapted to surviving overwinter. This combined with changing weather patterns might lead to higher disease pressure over time.

Another possible threat Alberta producers may have to deal with is new U.S. president Donald Trump. On Feb. 1, Trump signed an executive order to apply a 25 per cent tariff on all Canadian-produced goods entering its neighbour to the south, following through on a promise made in November. That executive order has since been put on hold. (Editor’s note: As of press time, Feb. 5, the 30-day pause is in effect).

Hochstein says whilemeasures such as tariffs would be a concern for his organization and its members, the issue would not have the same effects across Alberta’s entire potato industry due to the diversity of operations.

“The processors are multinationals. They operate on both sides of the border. That’s more at their level of discussions, not ours. We provide a raw product. How they market their product and where it goes, that’s for the next level up of production to decide.

“However, there is concern in our seed industry about remaining competitive with the U.S. market when it comes to selling our seed south of the border. A 25 per cent tariff would wreak havoc on our seed industry and our ability to maintain the relationship that we have established with our U.S. customers.”

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