The Effect of Energy Cost Changes on the U.S. Potato Industry

Abstract

Since World War II U.S. Agriculture has seen regional shifts and greater concentration in the production of certain commodities. Technological and infrastructural developments in irrigation, plant varieties, cultivation techniques, transportation, storage, and processing have lowered the barriers of time and space, thus allowing remote regions to compete with and even dominate the traditional production areas. The U.S. potato industry offers an excellent example of this. Processed potatoes have become the dominant food use form and production has shifted westward and become more concentrated both with respect to time and location. In 1947, 44 percent of U.S. potato production was in the seven largest potato states for the fall crop, 35 percent was produced in the nonfall crops, and eight percent was processed. By 1978, 75 percent was produced by the seven leading states for the fall crop, 14 percent in the early nonfall crops, and 59 percent was processed. Because many of these changes involved the adoption of relatively energy intensive techniques, the existence of low and fairly stable energy prices until 1973 aided this change. The increases in energy costs since 1973 raise questions about the long-run stability of recent patterns of production and consumption.