Farm share of U.S. food dollar rose in 2018
On average, U.S. farmers received 14.6 cents for farm commodity sales from each dollar spent on domestically produced food in 2018, up slightly from 14.4 cents in 2017. Known as the farm share, this amount rose for the first time since 2011. This increase coincides with a flattening in average prices received by U.S. farmers (as measured by the Producer Price Index for farm products) in 2017 and 2018, after steep declines in 2015 and 2016. A preliminary 2017 farm share estimate published last year was also 14.6 cents, but the 2017 figure has been revised downward to 14.4 cents in the newly-released updates. The Economic Research Service (ERS) uses input-output analysis to calculate the farm and marketing shares from a typical food dollar, including food purchased both at grocery stores and at restaurants and other eating-out places. The marketing share covers the costs of getting domestically produced food from farm to points of purchase, including costs related to packaging, transporting, processing, and selling to consumers at grocery stores and eating-out places. The relatively low farm share measures for 2015-18 occurred during a 7-year trend of increases in the portion of the food dollar going to the foodservice industry. Farmers receive a smaller share from eating-out dollars because of the added costs for preparing and serving meals at eating-out places, so more food-away-from-home spending also drives down the farm share. The data for this chart can be found in ERS’s Food Dollar Series data product, updated on March 23, 2020.
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