Close to 7 cents of the U.S. food dollar is value added by U.S. farms
For a typical dollar spent in 2011 by U.S. consumers on domestically produced food, 15.5 cents represents the farm share, or value added at the farm gate. The farm share includes the value added by the farmer; services and supplies from agribusinesses; and farm-level inputs from nonagribusiness industries. For example, the energy industry supplies natural gas to agribusinesses producing nitrogen fertilizers used on U.S. farms, and the finance and insurance industry supplies financial services to U.S. farmers. Nonagribusiness industries accounted for 4.6 cents of the farm share in 2011, and agribusinesses added 3.0 cents of value. From the remaining 7.9 cents of farm value added, 6.6 cents was produced on U.S. farms and 1.3 cents represents imported farm commodities purchased as inputs by U.S. producers. Most of the farm value added represents property income accruing to the farmers who own the farm operations. Salaries and benefits for hired farmworkers amounted to 1.7 cents. Net farm subsidies from the Government lowered farm commodity costs per food dollar by about 1 cent in 2011. This chart appears in “ERS Food Dollar Series Allows an Indepth Look at Farm-Level Components of the U.S. Food Dollar” in the July 2013 issue of Amber Waves magazine.
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