Key Points
- Australia's in the midst of a nationwide potato shortage.
- It could cause a rise in the cost of hot chips at pubs and takeaway shops.
- Some supermarkets have also placed customer limits on frozen chips.
The price of hot chips in pubs and takeaway restaurants could be on the rise this holiday season due to a nationwide potato shortage.
Hospitality venues are faced with either absorbing costs in the short term or increasing meal prices after and supply chain-related shortfalls.
"The increase in the price of potatoes puts more financial pressure on pubs already facing increased costs including power, beer excise, drinks over the bar, transport and staff," Australian Hotels Association National President David Canny said in a statement on Saturday.
Potato yields in Victoria and NSW have been slashed in 2022 by summer and spring floods either side of a wetter-than-average winter.
Red Funnel Food Service Distributers director George Sofianos said it had been a terrible year for potato crops in Victoria.
"International supply has also been impacted by drought - the other problem here in Australia is a delay in planting also caused by bad weather in Victoria," he said.
The AHA said the low margins for potato producers meant it was difficult for suppliers not to pass on costs to hoteliers.
On Friday, supermarket chain Coles announced a two-bag-per-customer limit on frozen chip products in response to the shortage.
Larger multi-venue operators such as Lewis Leisure, which has hotels in NSW and Queensland, are looking at significant hits to their balance sheets.
"We use around 200,000 kilograms of chips per year across our four venues so we could be looking at an additional half a million dollars in costs over a year," Lewis Leisure head Brad Jenkins said.
"At the moment we're hoping it will be a three-to-six-month shortage and during that time we'll absorb the cost so it doesn't impact patrons - after that we may have to consider raising our prices."
