NAICS 111211 Quarterly Industry Report
Potato Farming
Comprehensive industry research for valuation professionals, business owners, buyers, and lenders
NAICS Code: 111211Sector: Agriculture, Forestry, Fishing and Hunting (11)Updated: Q1 2026
About This Report
This Fair Market Value industry profile for Potato Farming (NAICS 111211) draws on data from the USDA National Agricultural Statistics Service[4], the U.S. Census Bureau[5], the Bureau of Labor Statistics[6], and the SBA Office of Size Standards[7]. All statistics reflect the most recently published government data at the time of writing. This report serves as a starting reference for business appraisers, M&A advisors, and lenders evaluating potato farming operations under NAICS 111211.
Industry Definition & Overview
Potato Farming (NAICS 111211) encompasses establishments primarily engaged in growing potatoes and producing seed potatoes. The U.S. Census Bureau[3] classifies this industry within the vegetable and melon farming subsector, covering russet, red, yellow, white, blue, fingerling, and specialty potato varieties grown for fresh market, processing, and seed stock purposes [1]. Idaho dominates national production, accounting for roughly one-third of total U.S. potato acreage, followed by Washington, Wisconsin, Oregon, North Dakota, and Colorado [2]. Russet varieties represent approximately 71 percent of annual domestic potato acreage, driven by demand from frozen french fry processors and the fresh retail channel. The Pacific Northwest corridor from Idaho through Washington produces the majority of processing potatoes under contract with major frozen food companies [3].
All potato production in 2024 totaled 421 million hundredweight from approximately 927,000 harvested acres, reflecting a 4 percent decline from 2023 levels per USDA NASS[4] crop production data [4]. Potato farming is more capital-intensive than most grain crops, requiring specialized planting, harvesting, and storage equipment capable of handling a perishable root crop. Revenue depends on contracted processing volumes, fresh market pricing at regional shipping points, and seed potato certification programs managed by state departments of agriculture [5]. Water availability and irrigation costs represent critical operating concerns, particularly in the Snake River Plain of Idaho and the Columbia Basin of Washington where center-pivot and furrow irrigation systems sustain production in arid conditions [6].
What's Included in This Industry
- Russet potato production for processing and fresh markets
- Red potato farming operations
- Yellow and gold potato cultivation
- White potato growing for chipping and fresh retail
- Specialty and fingerling potato production
- Seed potato growing and certification programs
- Organic potato farming operations
- Sweet potato cultivation
- Potato storage facility operation and management
- Contract potato production for frozen food processors
NAICS Classification Hierarchy
| Level | Description | Code |
|---|---|---|
| Sector | Agriculture, Forestry, Fishing and Hunting | 11 |
| Subsector | Crop Production | 111 |
| Industry Group | Vegetable and Melon Farming | 1112 |
| NAICS Industry | Vegetable and Melon Farming | 11121 |
| National Industry | Potato Farming | 111211 |
Related NAICS Codes
| Code | Description | Relationship |
|---|---|---|
| 111219 | Other Vegetable (except Potato) and Melon Farming | Other vegetable and melon farming covers crops that rotate with potatoes on irrigated acreage, including onions, sugar beets, and dry beans |
| 311411 | Frozen Fruit, Juice, and Vegetable Manufacturing | Frozen fruit, juice, and vegetable manufacturing includes frozen french fry and potato product processors that represent the largest buyer category for potato farms |
| 311919 | Other Snack Food Manufacturing | Other snack food manufacturing produces potato chips and dehydrated potato products that source directly from farming operations under contract |
| 424480 | Fresh Fruit and Vegetable Merchant Wholesalers | Fresh fruit and vegetable merchant wholesalers handle the distribution of fresh-market potatoes from farm shipping points to retail and food service outlets |
| 115112 | Soil Preparation, Planting, and Cultivating | Soil preparation services provide custom tillage, fumigation, and bed formation for potato fields that require intensive soil preparation each season |
| 424490 | Other Grocery and Related Products Merchant Wholesalers | Other grocery and related products merchant wholesalers distribute processed and packaged potato products through wholesale supply chain channels nationwide |
SBA Lending Summary
24
Total SBA Loans
$880K
Total Loan Volume
$37K
Average Loan Size
10 yrs
Average Loan Term
13.50%
Average Interest Rate
64
Jobs Supported
Source: SBA 7(a) Program Data, U.S. Small Business Administration — FY 2025[2]
Key Insight: The SBA[8] assigns NAICS 111211 a revenue-based size standard of $4.25 million in average annual receipts, higher than the $2.25 million threshold applied to most grain crops, reflecting the greater capital intensity and revenue scale of commercial potato operations. Many mid-size potato farms approach or exceed this ceiling due to the high per-acre revenue potential of irrigated production. Qualifying businesses access Farm Service Agency loans, USDA disaster assistance, and SBA 7(a) financing for storage construction, irrigation upgrades, and specialized equipment purchases [7]. Federal crop insurance through the USDA Risk Management Agency[9] offers both yield-based and revenue-based policies for potato producers, and participation rates are high given the crop's susceptibility to disease, weather damage, and market price swings [8]. Additionally, 504/CDC loans[10] provide long-term, fixed-rate financing for major fixed assets such as real estate and equipment.
Top SBA Lenders
| # | Lender | Loans | Volume | Avg Loan |
|---|---|---|---|---|
| 1 | Readycap Lending, LLC | 8 | $400K | $50K |
| 1 | Columbia Bank | 8 | $400K | $50K |
| 3 | Manufacturers and Traders Trust Company | 8 | $80K | $10K |
Frequently Asked Questions
Common questions about this industry.
What types of businesses fall under NAICS 111211?
NAICS 111211 covers establishments primarily engaged in growing potatoes and producing seed potatoes. This includes russet, red, yellow, white, and specialty variety growers, organic potato farms, sweet potato operations, and seed potato certification programs managed through state agricultural agencies [1].
What is the SBA size standard for Potato Farming?
A potato farming business qualifies as small under SBA guidelines if its average annual receipts do not exceed $4.25 million, measured over the preceding five completed fiscal years. This threshold is higher than most crop farming categories, reflecting the capital-intensive nature and higher per-acre revenue of commercial potato production [7].
How is a potato farm typically valued for sale?
Potato farm valuations combine asset-based and income-based methods, with land values anchored by irrigation water rights, soil quality, and proximity to processing plants. Storage infrastructure represents a uniquely significant asset component, as controlled-atmosphere facilities capable of holding potatoes through the winter can add substantial value. Processing contracts with major frozen food companies provide stable revenue streams that support income capitalization analysis documented in regional land value surveys published by USDA ERS[11] [9].
What are the major cost drivers for potato farming?
Seed potato purchases, irrigation water and energy costs, and soil fumigation treatments compose the largest variable expenses. Potato production requires more intensive pest and disease management than most grain crops, with late blight, early blight, and nematode infestations demanding preventive fungicide and fumigant applications. Storage energy costs for temperature and humidity control add post-harvest expenses. Land rental rates for irrigated ground in premium potato districts can exceed $400 per acre in Idaho and Washington per USDA NASS[4] survey data [5].
Which states lead U.S. potato production?
Idaho leads the nation with roughly one-third of total potato acreage, concentrated along the Snake River Plain in the eastern and southern portions of the state. Washington ranks second, with production centered in the Columbia Basin where irrigation from the Grand Coulee Dam system supports high-yield farming. Wisconsin, North Dakota, Oregon, and Colorado round out the top producing states, each serving a mix of fresh market and processing demand as documented by USDA NASS[4] [2].
How do processing contracts affect potato farm operations?
Processing contracts with frozen food manufacturers guarantee a predetermined price and volume for a specified potato variety, providing revenue certainty that fresh-market sales cannot match. Contracted growers must meet strict quality specifications for size, specific gravity, sugar content, and defect tolerances. Contract terms typically span one to three years and may include provisions for acreage adjustments based on processor inventory positions. Operations with established processor relationships command valuation premiums over farms dependent solely on the open market [3].
What role does storage play in potato farming?
Controlled-atmosphere storage facilities allow potato producers to hold inventory from fall harvest through the following spring or summer, timing market sales for optimal pricing. Modern storage buildings maintain temperatures between 38 and 45 degrees Fahrenheit with humidity controls that minimize shrinkage and sprouting. Storage capacity represents a significant capital investment but enables operators to capture seasonal price premiums and fulfill year-round processing contracts. Quality degradation risks from disease, internal defects, or temperature fluctuations require active monitoring throughout the storage period [6].
What trends are shaping the potato farming industry?
Rising demand for frozen potato products in international markets is expanding processor capacity and contract acreage in the Pacific Northwest. Water resource constraints tied to Endangered Species Act requirements on the Snake River and Columbia River systems are tightening irrigation allocations in key production zones. Precision agriculture technologies enable variable-rate irrigation and targeted pest management that improves per-acre profitability. Consumer preferences shifting toward specialty varieties and organic production are creating premium market segments tracked by the USDA Economic Research Service[11] [4].
Sources & References
Government datasets and editorial sources used in this report.
- [1]U.S. Bureau of Labor Statistics, Quarterly Census of Employment and Wages bls.gov
- [2]U.S. Small Business Administration, SBA 7(a) Loan Program Data data.sba.gov
- [3]U.S. Census Bureau census.gov
- [4]USDA NASS nass.usda.gov
- [5]U.S. Census Bureau census.gov
- [6]Bureau of Labor Statistics bls.gov
- [7]SBA Office of Size Standards sba.gov
- [8]SBA sba.gov
- [9]USDA Risk Management Agency rma.usda.gov
- [10]504/CDC loans sba.gov
- [11]USDA ERS ers.usda.gov
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