"No Small Potatoes"

No Small Potatoes

The Economic Contribution of the Michigan Potato Sector

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Key Takeaway 1

ECONOMIC IMPACT

The Michigan potato industry has a massive impact on the state economy, creating more than

$2.5 billion

in economic activity.

A new Michigan State University study reveals that Michigan potatoes deliver $1.5 billion in direct economic activity resulting from growing, processing, wholesaling, and retailing potatoes and potato products.

The potato supply chain delivers an additional $1 billion in indirect economic activity from related industries and consumption.

Jobs

JOBS

The Michigan potato industry supports around

21,700

jobs, generating

$832

million in wages and $2.5 billion in gross state product.

15,600 jobs are directly supported by the Michigan potato supply chain, and 6,100 are indirectly supported.

Approximately 0.5% of the Michigan workforce is linked to the state’s potato supply chain.

Potato Chip Capital

CHIPPING CAPITAL

Michigan is the

potato chip capital

of the U.S., growing more potatoes that become potato chips than any other state.

One in four bags of potato chips enjoyed in the U.S. are filled with Michigan-grown spuds.

70% of Michigan-grown potatoes are used for chipping and sold at a premium.

State Ranking

Potatoes are Michigan’s second largest commodity, behind only apples.

Michigan growers produced nearly 1.9 billion pounds of potatoes across all categories: seed, fresh, frozen, dehydrated, and processing. Sales of these potatoes generated more than $246 million in 2022 alone.

This puts Michigan as the 8th largest state in potato production, and 6th in terms of sales.

Slide 1

The Supply Chain

It all begins on the 761 Michigan farms that produce potatoes. Once potatoes are harvested, they are sorted, sized, and graded before most are shipped off to food distributors or processors. Twenty percent of Michigan-grown potatoes end up in supermarkets or other locations that sell fresh potatoes, while about 75% go to processors – mostly potato chip makers. The other 5% is used as seed to grow the following year’s crop.

Chipping Capital of the U.S.

Michigan is the nation’s leading producer of chipping potatoes. Growing more potatoes that become potato chips than any other state, nearly 70% of all Michigan-grown potatoes are sent to local and national potato chip producers. This equates to 25% of all potato chips consumed in the U.S.

As of 2017, there were 761 potato-producing farms in Michigan. Of those, 107 grew for processing, but accounted for 80% landmass used. Potato processing includes inputs from manufacturing and other agricultural fields including packaging, utilities, salt, breading, spices, cooking oils, energy, and more.

Process

The Process

Given the versatility and popularity of potatoes, they are used in all sorts of ways. They can simply be bagged and sold for at-home consumption, but they’re also used to make potato chips, canned, dehydrated, frozen, or refrigerated potato products, and as a secondary ingredient in things like store-prepared deli salads, soups, and frozen dinners. These products are sold in retail stores, but many are used in foodservice, such as restaurants, hospitals, schools, and other institutions.