An oversupply of British potatoes is putting serious strain on growers' margins - but giving consumers the chance to buy new season spuds at good prices.

Excellent growing conditions at the start of the British season have produced 20% larger yields than last year and, with many old crops still on the market, wholesale prices have plummeted.

As a result, growers are receiving considerably less for their crops this year.

The average farmgate price for British potatoes in the week ending 26 June was £131/tonne compared with £186/tonne in the same week last year, according to data from the Potato Council. Retail prices have so far shown little movement, but the average price of the cheapest 2kg to 2.5kg bag of potatoes in the big four over the past month has fallen 1% compared with the same period last year to £1.33 [The Grocer Price Index]. Although small, the drop is significant at a time when many fresh produce items cost more than they did a year ago.

Supermarkets have taken advantage of the situation to offer promotions. Tesco is offering 98p off on pre-packed new potatoes, while Asda is selling two packs for £3. Sainsbury's and Tesco have also been selling unwashed new potatoes on promotion over the past few weeks, according to analyst Market Intelligence Services.

Potato quality of early season varieties such as Maris Bard and Premiere has been excellent, said Rob Burrow, market information manager for the Potato Council.

"Conditions have been very good so there are lots of potatoes around."