Cheap potato fever is spreading in austerity-pummeled Greece

By The WSJ | Associated Press – This is a reproduction
THESSALONIKI

It started last week when a producer from the northern Nevrokopi area, fed up with selling to wholesalers at a loss, offloaded 24 tons at cost prices directly to consumers in the town of Katerini. Now, he has been swamped by demand. Lefteris Kessopoulos said Thursday he has been contacted by resident groups in Athens, the northern towns of Kavala and Larissa — even Pyrgos, 1,000 kilometers (620 miles) south of Nevrokopi. “We’re getting phone calls from all over Greece,” he said.

After more than two years of deeply resented belt-tightening, imposed to keep the country afloat after decades of profligate government spending, Greece appears to be heading for a social meltdown. Incomes have dropped dramatically, one in five workers is unemployed — double the pre-crisis figures — and state outlays on crucial sectors such as health care and education have been axed.

The country has been subsisting on international rescue loans since May 2010. Academic staff and students at the University of Thessaloniki have arranged for a group of Nevrokopi farmers to sell 50 tons on Friday outside a campus building. The price will be €0.25 ($0.33) a kilogram (2.2 pounds), almost a third of the €0.70 ($0.93) that supermarkets charge.

Similar sales are planned in several towns over the next few days, while some resident groups are trying to organize deals with olive oil producers on the island of Crete.

Nevrokopi farmers say it costs about €0.20 cents ($0.27) to produce a kilogram of potatoes, but that wholesalers will only buy them for €0.10-0.12. Faced with making a loss, many producers say they have been unable to even get their products to the market.

Greece’s severe financial crisis, now entering its third year, has seen pensions and salaries repeatedly slashed and led to skyrocketing unemployment with more than 1 million jobless. Incomes have been further hit by steep tax hikes imposed by a government desperate to boost state revenues.

More and more people have been turning up at soup kitchens run by the church or local aid groups, and homelessness has been increasing.

In the northern town of Drama, near Nevrokopi, a consumer association and the local labor council are organizing a sale of 20 tons of potatoes on Saturday.

“It’s time profiteers get pushed out of the market,” Drama labor leader Giorgos Savridis said. “In this way, we are helping potato producers, but also consumers who are having a hard time due to the crisis.”

In the Athens suburb of Pallini, municipal officials have asked residents to send in order forms by March 8 before a forthcoming Nevrokopi potato sale — at €0.28 ($0.37) per kilogram to allow for transportation costs.

“Financial circumstances dictate our intervention to create a social solidarity and protection network for our residents,” a municipality statement said.

Kessopoulos, the producer, said wholesalers have started offering farmers higher prices after the Katerini sale. But the best offer, €0.17 per kilogram, is still below production costs.