The next time you spend a dollar at the grocery store, consider this – only 10.5% of that total came from farm production costs, according to a recent report from the USDA Economic Research Service (ERS). That’s up from 8.3% during the past two years.
ERS calculates the value added (or “cost contributions”) to the U.S. food dollar from 12 industry groups in the food supply chain. (Note that “other” includes two groups – agribusiness, and legal and accounting.) This is a snapshot of the 2013 food dollar.
Annual shifts in the food dollar among industry groups happen for a variety of reasons, including the mix of food consumers purchase and relative input costs. One big downshift in 2013 included products and services provided to farmers by agribusiness. It only accounted for 2.1% of the 2013 food dollar, down from 12.5% in 2012.
Taking the lion’s share of the 2013 food dollar was food services (31.5%) and food processing (15.5%).
The ERS also noted that for every dollar spent in 2013 in the U.S. on domestically produced food, U.S. farmers sold 17.4 cents of farm products to non-farm establishments (farm share). After falling to 16.2 cents in 2009, the farm share of food dollar expenditures in 2013 is at a level comparable to the 2007-08 level. Also, energy costs per food dollar decreased one-half cent from 5.6 cents in 2012 to 5.2 cents in 2013.
For more information, visit http://www.ers.usda.gov/data-products/food-dollar-series.aspx.