High Potato Prices Plump Up Costs for Chips and Fries

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Written by The Home Economist

Tuesday, 16 June 2009 17:08

New government report suggests retailers will raise prices for potato-based products. By Brett Graff, The Home Economist

High potato prices are forcing the snack-manufacturers and frozen French Fry-makers to charge more for their spud-based specialties. Producers at the moment are jacking up rates for retailers, which are famous for passing high prices on to their customers. (That's you.)

Potato prices have been rising since October 2008, according to the U.S. Department of Agriculture. While the government's inflation report this morning said that farmers are charging a bit less for spuds now (see chart) it also showed that snack and fry makers have upped the prices for their potato-based fare.

Frozen French fried potato prices are up 20.1 percent from last year, according to the Bureau of Labor Statistics. That's not only because potatoes are pricey but also because other countries can't get enough of this staple in the American diet. We've been sending most of our fried exports to Mexico and Japan, according to the U.S.D.A.

And on the subject of snacking, your chip prices may are also plowing upward -- with manufacturers charging stores about 14.6 percent more than they did last year.

Item	Producer Price Change from Last Year	Producer Price Change from Last Month
Long White Potatoes	+31.4 percent	- 1.3 percent
Round White Potatoes	-8.4 percent	- 29.4 percent
Russet Potatoes	-8.6	-5.3
Irish Potatoes for Processing	+39.0 percent	-1.2 percent
Frozen French Fried Potatoes	+20.1 percent	-
Chips	+14.6 percent	+0.6 percent