Feb 20, 2024

Michigan potatoes generate $2.5B within the state

A new report authored by Michigan State University economists found that the potato industry generates $2.5 billion each year to the state’s gross domestic product.

That includes almost $1.5 billion in direct economic activity stemming from growing, processing, wholesaling and retailing potatoes and potato products, according to “No Small Potatoes: The Economic Contribution of the Michigan Potato Sector.” The report, released Feb. 20 by the Michigan Potato Industry Commission, also found that Michigan potatoes contribute an additional $1 billion in indirect economic activity from related industries and consumption.

The potato supply chain supports around 21,700 jobs in the state, which generate about $832 million in wages, according to the report.

“The report demonstrates that potatoes are a major agricultural commodity here in Michigan, a fact that sometimes flies under the radar — much to our chagrin,” said Kelly Turner, executive director of the Michigan Potato Industry Commission.

The information in the report can help change that, Turner said. MPIC is sending 12 growers and industry partners armed with the new statistics to Washington, D.C., Feb. 27-March 3 for the National Potato Council’s Washington Summit. The report’s findings can help increase Michigan’s competitiveness for federal agricultural grants, Turner said, along with providing tangible data to help ensure potatoes’ representation in the 2024 Farm Bill and promote foreign trade.

Turner joined Ryan Norton, MPIC chair and farm manager at Walther Farms in Three Rivers, Michigan, and Phil Gusmano, MPIC commissioner and vice president of purchasing of Detroit-based Better Made Snack Foods, on a conference call Tuesday to discuss the report.

The report found that in 2022, Michigan potato growers produced almost 1.9 billion pounds of potatoes across all categories: seed, fresh, frozen, dehydrated and processing, with farm sales totaling more than $246 million. That output ranks Michigan as the eighth-largest state in potato production and No. 6 in terms of sales, making potatoes the second largest specialty crop produced in the state, behind only apples.

“We all know that agriculture supports jobs in rural communities,” Gusmano said. “As the vice president of Better Made Snack Foods, we have an appreciation of those crops and the importance of those crops in an urban environment. We send the Michigan potatoes that we process all over the world. We like to buy local and sell local. We find that the quality we receive from Michigan potatoes is second to none.”

Michigan grows more chipping potatoes that any other state, according to the report, with one out of every four bags of potato chips made in the U.S. filled with potatoes grown in Michigan. Of the nearly 2 billion pounds of potatoes grown each year, about 70% of Michigan’s potato production by volume is sent to potato chip processors both in state and throughout the country.

“We’ve always known that potatoes are America’s favorite vegetable, but today we got an understanding of how important they are to our state’s economic health,” said Norton, who oversees 4,700 acres of potatoes grown in Three Rivers.

MPIC was formed in 1970 by the Michigan legislature as the state’s potato research, promotion and education organization.

Turner said the Michigan-specific report used the same researchers and many of the same metrics as a 2023 report funded by NPC that highlighted the potato industry’s $100.9 billion national impact.

“The nice thing is having this really comprehensive data is different from how we used to gather information,” she said. “There are places like NASS (National Agricultural Statistics Services) and other areas where you go and pull specific data sets, but really nothing to this level has been done in the past.”

— Melinda Waldrop, contributing editor