PGI Formulates Diversion Program

Published online: Dec 11, 2000
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Potato Growers of Idaho have announced the proposed diversion program they hope will be accepted by the industry.

In a news release issued Monday, Dec. 11, John Thompson, PGI communications director, said a company called Potato Management Company has been formed that can manage the oversupply in order to hopefully generate a market with positive fundamentals

The program will be presented to growers and industry representatives at 1 p.m. on Tuesday, Dec. 19, at the University Place Auditorium on Science Center Drive in Idaho Falls, ID. (Note: the meeting was changed from it's originally announced 2 p.m. starting time.)

Fresh and process growers and shippers from all states will be invited to join with this true self-help program, Thompson stated. "We can choose to be victims of the inevitable changes occurring, or be proactive and initiate change."

Thompson said all growers with open potatoes would be asked to pay a fee and sell a portion of their crop in order to create a market for the remainder of the crop.

All growers will benefit because the unmanageable surplus will be removed. The program is designed to improve both fresh market prices and insure the oversupply doesn't hang over next year's market, he explained.

"Even growers who do not have noncontracted potatoes are encouraged to help fund this effort. Timing is critical. The program must be in place by Jan. 15, 2001. There is no time for hand wringing," he continued.

The seven-point program spells out the need for a legal entity to target 10 percent of open potatoes, which they will buy from each grower for $1.

Growers will sign a one-year renewable membership with the PMC and pay $500 to fund the program plus two cents per committed cwt.

PMC will take control of the potatoes, inspecting and marking the storages. The sales contract will not be triggered until a sufficient overall volume of potatoes is committed.

PMC will dispose of the 10 percent purchased with any net cost of disposal charged to that member. If a sufficient volume is not committed, any unexpended funds will be returned to the members pro-rata. When a sufficient volume is committed a committee will be formed to make policy decisions for PMC.