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The Mystery Of the Ridiculously Pricey Bag Of Potatoes

Filed by KOSU News in Business.
June 18, 2013

On Monday we told you about allegations that America’s potato growers had banded together in a price-fixing Potato Cartel.

The allegations we described come from a civil lawsuit filed by the Associated Wholesale Grocers against the United Potato Growers of America, a group whose members produce the vast majority of the country’s spuds. The lawsuit alleges, in part:

“As a result of these efforts, by the summer of 2008, according to the Idaho Potato Commission, a ten pound bag of potatoes cost consumers $15 — up $6 over 2007.”

As many of you noted, those prices alleged in the lawsuit seem awfully high. So we called the USDA’s National Agricultural Statistics Service to get to the bottom of this potato puzzler.

A NASS statistician told us that back in 2008, U.S. farmers on average got paid $8.39 for a 100-pound bag of potatoes. Those are wholesale prices, sure, but they are still a far cry from the $15 for a 10-pound bag that the lawsuit alleges consumers paid.

As for retail prices? Well, in 2008 potatoes were retailing at 48 cents a pound on average, according to data from the USDA’s Economic Research Service. The data weren’t collected for 10-pound bags, but the average for 5-pound bags was $2.55, according to the USDA’s Agricultural Marketing Service. So extrapolating those figures, it’s safe to guess that a 10-pound bag of taters probably cost closer to $5 — not $15 — back in 2008. Whoops.

The plaintiff’s lawsuit cites the Idaho Potato Commission as the source of its figures. The lawyer representing the plaintiff did not reply to our request for comment. We called the commission, too, to see if perhaps it had different data that could explain the high figures the suit cites. Alas, the relevant people, we were told, were all out of the office. [Copyright 2013 NPR]

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