Flakes, fries, chips, and spuds: The powerful economics behind potatoes

The National Potato Council estimates the United States’ domestic potato industry created 714,000 jobs, generated $34.1 billion in wages, and added $53.5 billion to the U.S. Gross Domestic Product in one year alone. Potatoes in all forms, from flakes to slices to whole spuds, have become one of the most important agricultural commodities around the world.

“Not only are potatoes an essential and healthy component in our diet, but now we can say unequivocally that they are vital to the American economy,” explains RJ Andrus of Idaho’s TBR Farm and incoming president of the National Potato Council. “Potatoes are an essential component to our prosperity as a nation, built and sustained by America’s potato growers, who put people to work in every city and town across our great country. A recent report cements the fact that potatoes are America’s favorite vegetable with value.”

This unassuming but versatile vegetable has found its way into the recipes and culture of virtually every country in the world and has also become a major international commodity. It is considered a dietary staple in regions where other crops have proven challenging or impossible to produce. The global demand for potatoes continues to grow year after year in a range of markets.

Potato Chips

The potato chip was invented in 1853 by George Speck (later Crum), a cook at the Moon Lake Lodge Resort in Saratoga Lake, New York. A customer’s repeated requests for thinner, crispier french-fried potatoes prompted Speck to fry paper-thin potato slices in oil until they turned brown. The “Saratoga chip” became popular with other customers, creating a new snack item for the general public.

The global potato chip market is projected to reach $40 billion by 2028, largely fueled by the popularity and convenience of shelf-stable potato chips. The United States currently dominates the potato chip marketplace, with companies such as Frito-Lay and Utz producing both plain and flavored products.

While major snack companies such as Frito-Lay and Wise enjoy mainstream success, the potato chip market also has room for niche companies specializing in small-batch production. A wide range of flavor profiles, fat content, and textures means customers can find a brand that meets their individual needs.

French Fries

Although the origins of the French fry remain shrouded in mystery, there can be no doubt the side dish/snack itself is enjoying significant success with consumers. The global French fry market is expected to reach $18.5 billion by 2027, including both fresh and frozen products. The fast food market alone is fiercely competitive, with potential customers often basing their dining decisions on the quality of a brand’s French fries alone.

Frozen ready-to-cook French fries are also popular in home kitchens, largely because of their ease of preparation and their compatibility with other dishes. French fries can be served as side dishes for sandwiches, fried fish, and meat entrees, but can also be prepared as a stand-alone snack. They can be deep-fried, baked, air-fried, or even microwaved. The potatoes can be sliced into crinkle cuts, thick planks, or thin shoestring fries. French fried potatoes perform well with seasonings and can be topped with chili, cheese sauce, and other savory toppings.

Dehydrated Potatoes

Potatoes respond well to both dehydration and reconstitution. Dried potato flakes are key to many commercial soups, stews, gravies, and food thickeners. They also serve as the base for instant mashed potatoes, a popular shelf-stable item in home pantries.

Potato flour is a plant-forward alternative to processed wheat and white flour in baked goods.

Dehydrated potatoes are also the foundation of many snack items, most notably Pringle’s brand potato crisps.

The global dehydrated potato market is expected to reach $9.68 billion by 2030, fueled by growing demand for processed and shelf-stable foods. Increasing interest in plant-based foods has also added to the appeal of dehydrated potatoes as a vegan food thickener or cornstarch alternative. A long shelf life and high nutritional value make dehydrated potato flakes common in emergency food kits.

Fresh Potatoes

Germany, the Netherlands, and Canada lead the world in fresh and chilled potato exports, while Belgium, the Netherlands, and the United States are the greatest importers of fresh spuds. The global fresh potato market is expected to reach $118.15 billion by 2028.

While dehydrated or processed potatoes still dominate the overall market, many commercial food producers consider fresh or chilled potatoes a better choice for their products.

The abundance of fresh potatoes in almost every country has helped turn the root vegetable into a thriving and highly tradeable commodity. In fact, the Great Potato Famine in Ireland from 1845 to 1852 spurred several economic revolutions as both importers and exporters struggled to recover from the effects caused by the blight. Today’s potato crops benefit from disease resistance, soil management, and genetic research advances.

Making the Case for Potatoes

A general shift towards ketogenic and paleo low-carb/high-protein dieting has created something of an identity crisis for the potato, and organizations like the National Potato Council are investing in efforts to defend the benefits of the tuber. For example, potatoes are an excellent source of vitamin C, potassium, and vitamin B6.

An average potato also contains 110 calories per 5.3-ounce serving. Sweet potatoes are also high in vitamin A, and purple potatoes contain powerful antioxidants, including heart-healthy anthocyanins.