Industry: Competition changes the rules in the potato chip market

Manufacturers in traditionally leading production countries, such as the United States and Northwest Europe, face the need to adjust to a landscape that has changed drastically.

For decades, Europe and North America dominated the processing and trade of potato chips and similar products. However, the focus is now shifting to Asia and parts of Africa. According to multiple studies, this change is far from temporary; it represents a structural transformation driven by price competition, the surge in exports from lower-cost countries, and rapid changes in consumption habits. These dynamics are redefining the rules of the market.

The growth in demand  

Various analyses confirm that the global market for frozen french fries and other processed potato products continues to experience robust growth. Projections place its value between $17 billion and $25 billion by 2024/25, and between €24 billion and €30 billion by 2033. Although estimates vary depending on the source, all publications agree on the sustained growth.

The frozen french fry market is projected to grow between 3% and 5% annually over the next decade, a rate similar to the 4% average projected by various manufacturers in recent years. However, the emergence of new competitors is reducing the market share of traditional producers. These new companies offer significantly lower prices, which particularly affects manufacturers in the United States and Europe. Accustomed to passing on their higher costs to the final price, they find it difficult to maintain this strategy in an increasingly competitive market. In Europe, abundant stockpiles are even limiting the possibility of capitalizing on the current reduced crop prices.

The impact of fast food chains  

Much of the growth in this sector stems from factors such as the global expansion of fast-food chains, the surge in consumption of ready-made meals due to urbanization and changing lifestyles, and technological advances in processing and preservation that improve product quality and shelf life. The trend toward convenience—including air fryers, online shopping, and bulk sales—also reinforces this demand.

The sector’s development is not limited to frozen french fries: the broader market for processed potato products is growing even faster. The expanded range now includes alternatives that offer diverse business opportunities. The total market for frozen potato products is estimated to be worth approximately €66 billion, with a projected compound annual growth rate of 5.5%.

Surpluses versus deficits  

As global demand increases, some regions face opposing problems: while some grapple with surpluses, others experience shortages. Europe, for example, has witnessed an unprecedented surge in potato cultivation, registering a net increase of nearly 60,000 hectares in the main producing countries of the northwest of the continent by 2025. France and Germany lead this expansion with combined increases of 43,000 hectares, followed by the Netherlands and Belgium with nearly 14,000 additional hectares dedicated to production.

Thanks to favorable weather and high yields, Europe is expected to report a record harvest this year, accompanied by historic stock levels and a significant drop in prices. Meanwhile, in North America, producers have opted to limit planted area and implement strict controls to prevent oversupply. As a result of these contractual policies, the US market is more stable but less dependent on volume. A further reduction in planted area is already anticipated for 2026 due to pressure from low prices and the supply-demand imbalance.

An unstoppable boom in Asia  

In Asia, particularly in key markets like China and India, the figures are skyrocketing. China is consolidating its position as a major global exporter of frozen french fries. Meanwhile, India is registering record volumes with a growing share of international exports at highly competitive prices. For its part, Egypt is rapidly strengthening its position thanks to the advantage of early harvests, reduced logistics costs, and ever-increasing technological capacity for processing raw materials.

global price war

Recent reports clearly illustrate a global trend: an intense price war in the frozen french fry market. Countries like India and China are rapidly gaining ground in key markets such as Japan and Thailand, offering products up to 30% cheaper compared to European and American suppliers. As a result, average import prices in Asia have fallen by 10% to 20%. A prime example is Japan, where imports from China have grown by 65% ​​in just one year, while those from Belgium and the Netherlands have experienced a significant decline.

This downward pressure on prices is severely impacting traditional producers, primarily in Europe. High energy costs and labor prices make it difficult to reduce prices further. US suppliers, on the other hand, have managed to maintain some stability thanks to quality-focused contracts with large fast-food chains, making them less vulnerable to direct price competition.

Expansion into new markets

Global production of potato products is growing rapidly, driven by significant investments in regions such as Brazil, India, Egypt, China, and the Middle East. Leading potato chip companies like Lamb Weston, McCain, Farm Frites, Agristo, Aviko, and Simplot are also looking to strengthen their position in emerging markets characterized by lower labor costs, greater land availability, and improved logistics for transporting frozen products. This more diversified global landscape is displacing the historical dominance of Europe and North America.

The surge in global consumption

Consumption patterns are also undergoing significant geographical shifts. In India, domestic demand is experiencing explosive growth thanks to its young demographics, urbanization, and the increasing popularity of snacks. In China, the rise of fast-food chains, convenience stores, and social media trends is driving a notable increase in consumption.

On the other hand, Africa is experiencing remarkable growth in markets such as Egypt and South Africa, despite logistical and infrastructural challenges. Meanwhile, in the United States and the European Union, consumption remains high but stable, with limited growth due to market saturation. However, the global boom in air fryers has boosted domestic consumption of frozen french fries.

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Impact of international trade and logistical challenges

According to reports, trade measures such as WTO rulings on antidumping duties (for example, the case of Colombia) are reopening opportunities for European potato chip exporters. However, factors such as logistics costs, energy prices, and the effects of climate change are significantly impacting their competitiveness.

New trade dynamics are emerging: countries like Egypt and India are increasingly supplying markets previously dominated by Belgium and the Netherlands. In response, European and North American producers are pursuing strategies focused on premium products (higher quality, innovative coatings, and specialized cuts), greater production efficiency, contract farming, and sustainable practices such as eco-friendly packaging, risk management, and energy conservation. However, several studies conclude that these measures are not enough to fully counteract the growing pressure on prices globally.