Where Does Your Food Dollar Go?
Ninety-two percent of Americans consider it “somewhat important” to “very important” that food be affordable, followed by the 91 percent who felt the same way about nutrition, according to the Science and Food Survey released October 2015 by the Chicago Council on Global Affairs.
Nearly every food survey I’ve seen over the course of my speaking and writing career lists the price of food in the top three priorities. Farmers and ranchers have worked for decades to keep food costs low by increasing productivity. Some consumers question at what cost, but that sentiment changes as the income bracket goes down.
Americans spend only about 10 percent of their incomes on food, which means our food costs less than anywhere in the world! However, there is a trend toward social issues overcoming efficiency. There are unintended consequences of socially driven decisions ricocheting across our food system. It can create a divide between the food buyer and the food producer, who makes science-driven decisions.
Farmers receive 16 cents for every dollar you spend on food. You buy $10 worth of eggs and milk, and farmers receive $1.60 of that. Does that seem equitable? Off-farm costs (marketing expenses associated with processing, wholesaling, distributing, and retailing of food products) account for 84 cents of every retail dollar.
In 1980 farmers and ranchers received 31 cents out of every retail dollar spent on food in America. In three decades, the amount farmers received from your food dollar was nearly cut in half. These margins are tough for any business to survive—and the reason why farms have gotten larger.
If you are concerned about food costs, please know that is a shared concern with farmers and ranchers. The people who are raising your food are in the position of being price-takers rather than price-makers.
There is a ripple effect of unintended consequences across the grocery store when people are making rules or wanting change when they don’t understand the business. Price is one of those ripple effects. Farmers are not getting rich; they are facing higher production costs with lower profit margin. Where is the extra margin going? Regulations cost. Legislation costs. Changing housing costs. Diseases cost. Marketing labels cost. All of which add up to more expensive food for all of us.
Read more at Food Truths to Farm to Table and take a trip around the grocery store to be armed with 25 truths you urgently need to know about food so you can shop without guilt, confusion, or judgment. Learn the truths so you can recognize marketing and move on. A new book, Food Bullying, is expected late 2019.
