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As of August, food-at-home prices in 2020 were above 2019 levels

Wednesday, September 30, 2020

Grocery store food prices—or food-at-home prices—were 4.6 percent higher in August 2020 than a year earlier. Changes in food-at-home prices are measured by the Consumer Price Index (CPI) for Food at Home. The CPI for Food at Home looks at prices for a specific set of grocery store foods and beverages bought in cities around the country and compares the price of this “market basket,” or indexes it, to 1982-84 prices. Indexing provides information on cumulative changes in food prices over time, answering the question: How much higher are food prices this year compared with last year or past years? Over January to December 2019, the monthly price index for food at home ranged from 241.2 to 242.6, indicating prices rose or fell by no more than 0.6 percent per month. Monthly food-at-home prices in 2020 display a different pattern. Food-at-home prices rose by an average of 0.5 percent in January, February, and March, followed by a jump of 2.7 percent in April and a continued rise in May and June. In July and August, prices fell by 1.0 and 0.1 percent, respectively. Even so, food-at-home prices remained higher than during the previous year. For context, annual inflation for food at home has averaged around 2 percent for the past 20 years. Food-at-home prices in 2020 were influenced by the coronavirus pandemic. The pandemic put pressure on several food industries, disrupting supply chains for commodities including dairy, beef, pork, and poultry. For a closer look at specific food categories, explore the Economic Research Service (ERS) Chart of Note on retail price changes between June 2019 and June 2020. The data for both charts come from the ERS’s Food Price Outlook data product.

U.S. cotton product imports recovering from COVID-19 impact

Monday, September 28, 2020

U.S. cotton product imports—which are mostly clothing products—generally follow a seasonal pattern, with increased imports seen in the months prior to peak consumer buying periods like summer, back-to-school, and Christmas. As calendar year 2020 began, U.S. cotton product imports followed similar monthly levels as during the previous 3 years. However, as the COVID-19 pandemic unfolded, substantial shifts in the textile and apparel industry produced ripple effects throughout the supply chain from manufacturing to retail sales, which affected product imports significantly during the spring and summer of 2020. U.S. cotton product imports began deviating from their seasonal pattern in March 2020, dropping further in April and May. Since May, however, cotton product import data have been relatively positive, as the recovery of the textile and apparel industry progresses. May 2020 cotton product imports were only about 40 percent of the 2017-19 average for that month. However, by July—the latest available data—imports had climbed to 85 percent of its 2017-19 average. Although the economic recovery is expected to vary by industry, recent cotton product imports—a proxy for the textile and apparel industry—show substantial improvement supportive of the ongoing recovery. This information and the related impacts on global cotton demand are discussed in the Economic Research Service’s Cotton and Wool Outlook report for September 2020.

Genetically engineered soybean, cotton, and corn seeds have become widely adopted

Friday, September 25, 2020

Genetically engineered (GE) seeds were commercially introduced in the United States for major field crops in 1996, with adoption rates increasing rapidly in the years that followed. Currently, more than 90 percent of U.S. corn, upland cotton, and soybeans are produced using GE varieties. Most of these GE seeds are herbicide tolerant (HT), insect resistant (Bt), or both (stacked). The share of U.S. soybean acres planted with HT seeds rose from 7 percent in 1996 to 68 percent in 2001, before plateauing at 94 percent in 2014. Bt soybeans are not yet commercially available. HT cotton acreage expanded from approximately 10 percent in 1997 to a high of 95 percent in 2019. Adoption rates for HT corn grew relatively slowly at first, but then plateaued at 89 percent in 2014. Meanwhile, the share of Bt corn acreage grew from approximately 8 percent in 1997 to 82 percent in 2020. Increases in adoption rates for Bt corn may be due to the commercial introduction of new varieties resistant to the corn rootworm and the corn earworm. Bt cotton acreage also expanded, from 15 percent of U.S. cotton acreage in 1997 to 88 percent in 2020. This chart appears in the Economic Research Service data product, Adoption of Genetically Engineered Crops in the U.S., updated July 2020.

Child care centers accounted for 75 percent of meals provided by USDA’s Child and Adult Care Food Program in fiscal year 2019

Wednesday, September 23, 2020

In fiscal year (FY) 2019, USDA’s Child and Adult Care Food Program (CACFP) provided about 2 billion subsidized meals to children at child care centers and family day care homes, which accounted for 96 percent of all meals served in the program. Child care centers served 75 percent of CACFP meals in 2019. The program provided an additional 82 million meals to elderly and functionally impaired adults at adult day care centers. The number of CACFP meals served in family day care homes has dropped from a high of 777 million in FY 1996 to 435 million in FY 2019, while the number of meals served in child care centers has grown from 746 million to 1.5 billion over that same time period. USDA’s costs for CACFP in FY 2019 totaled $3.7 billion. Meals and snacks served to CACFP participants must meet USDA nutrition standards to receive Federal reimbursements. Closures of many child and adult care facilities due to the COVID-19 pandemic are reflected in fewer CACFP meals served in April 2020 compared with April 2019. Preliminary data from USDA’s Food and Nutrition Service record 125 million meals served in April 2020, down from 194 million meals a year earlier. Waivers to program regulations granted by USDA in March 2020 allowed providers to distribute CACFP meals as “grab and go” or via delivery. This chart appears in the Economic Research Service report, The Food Assistance Landscape: Fiscal Year 2019 Annual Report, July 2020.

Blueberry imports from Latin America increase to meet year-round demand

Monday, September 21, 2020

U.S. demand for fresh blueberries reached an all-time high in 2019, and to meet this increased demand, both domestic and global production of fresh blueberries have trended upward. U.S production for the fresh market climbed 284 percent since 2000 to almost 372 million pounds in 2019. Blueberries have different production seasons across different regions throughout the year. To support year-round demand of consumers, imports have grown and now not only supply blueberries in the off-season months of domestic production, but increasingly in the in-season months as well. U.S. fresh blueberry imports rose to a record 472 million pounds in 2019, up 1,177 percent since 2000. Latin America, led by Peru, emerged as the major supplier of U.S. blueberry imports. Fresh blueberry imports from Peru surpassed those from Chile and accounted for 30 percent of the imports in 2019. Imports from Chile accounted for almost 30 percent of fresh blueberry imports in 2019, while imports from Mexico accounted for 19 percent. Other top suppliers, Canada and Argentina, exported smaller quantities to the United States. Countries exporting to the United States during U.S. production’s off-season have expanded their seasons to capture market share and higher prices, increasing competition for some U.S. producers. This chart and detail appear in the Commodity Feature in the Economic Research Service’s Fruit and Tree Nut Outlook, March 2020.

USDA’s Purchase to Plate Price Tool estimates food cost for national food intake data

Friday, September 18, 2020

Researchers from two USDA agencies—the Economic Research Service (ERS) and the Center for Nutrition Policy and Promotion—recently collaborated on a project to help USDA update its Thrifty Food Plan, as mandated by the 2018 Farm Bill. Benefits for the Supplemental Nutrition Assistance Program (SNAP) are determined by the cost of the basket of foods that make up the Thrifty Food Plan. The collaborative project, the Purchase to Plate Price Tool, used a complex matching algorithm to link a USDA recipe database and 2013 grocery store sales data to estimate the retail cost of the foods participants reported eating in the 2011-12 National Health and Nutrition Examination Survey. These estimated costs can be used for a variety of purposes including to calculate daily at-home food costs for Americans—in general or by demographic subgroups. In this analysis, at-home foods are foods and beverages prepared at home from ingredients or ready-to-eat foods purchased at retail stores, such as supermarkets, supercenters, and convenience stores. The researchers found that across all ages, including both male and female survey participants, the average daily cost for at-home food was $4.54 per person in 2013. For 75 percent of the participants, the daily cost was $6.00 or less. More recent consumption and sales data will be incorporated into the Purchase to Price Plate Tool to support USDA’s update of the Thrifty Food Plan. The data for this chart are from the ERS report, Estimating Prices for Foods in the National Health and Nutrition Examination Survey: The Purchase to Plate Price Tool, September 2020.

Food security outlook improves for 76 low- and middle-income countries by 2030 despite income impacts of COVID-19

Wednesday, September 16, 2020

More than one-fifth of the 3.8-billion people located in 76 low- and middle-income countries in 2020 may not have consistent access to adequate calories to sustain a healthy and active lifestyle. The International Food Security Assessment (IFSA) models per capita food demand and compares it with a daily 2,100-calorie nutritional target to estimate long-term projections of food security and nutrition. In 2020, the number of people without access to 2,100 calories a day—the food-insecure—is estimated at 844 million. Of those, about 50 percent live in Sub-Saharan African countries, and 44 percent live in Asian countries. By 2030, however, the outlook for food security improves, even considering the income-depressing effects of COVID-19, with the number of food-insecure people projected to fall by 46 percent to 456.8 million. Of the regions evaluated in IFSA, Asia is expected to make the most progress reducing food insecurity in the 10-year period, while Sub-Saharan Africa is projected to improve at the slowest rate. Rising per capita incomes in most countries in the model, combined with relatively low food grain prices, are the expected drivers of the improvement in the food security outlook over the next decade. This chart appears in the Economic Research Service’s International Food Security Assessment, 2020-2030 situation and outlook report.

Most land exiting USDA’s Conservation Reserve Program was used for annual crop production

Monday, September 14, 2020

Between 2013 and 2016, contracts for about 7.6 million acres of land enrolled in USDA’s Conservation Reserve Program (CRP) expired. About 2.76 million acres of expiring land reenrolled in the CRP. Of the almost 4.89 million acres that exited the program during the period, 57 percent transitioned to annual crop production. At least half of the exiting CRP land transitioned to annual crop production in each of the four years. The most common annual crops grown on expired CRP land were soybeans (21 percent of the exiting CRP land that went into annual crop production), corn (16 percent), and wheat (16 percent). Perennial forage (such as alfalfa) and specialty crop (such as pecans) production accounted for 12 and 11 percent, respectively. Taken together, 81 percent of former CRP land was put to some type of crop production (annual, perennial forage, or perennial specialty) after exiting the program. The remaining exiting land was most often used as grass cover (14 percent) or tree cover (4 percent). Post-CRP acreage under grass cover may be used as pastureland or represent acres that are untouched after expiring from a grassland practice in CRP. This chart appears in the December 2019 ERS report, The Fate of Land in Expiring Conservation Reserve Program Contracts, 2013-2016.

Producers see negative net returns for corn, soybeans, and wheat in recent years

Friday, September 11, 2020

Producers of some of the U.S. major field crops have struggled to cover total costs of production over the past decade. The Economic Research Service’s (ERS) Commodity Costs and Returns product estimates this gap or surplus in the calculation of the value of production less total costs, referred to here as net returns. Total costs comprise operating costs, which include expenses such as fertilizer, seed, and chemicals, and allocated overhead (economic) costs, which include unpaid labor, depreciation, land costs, and other opportunity costs. Although revenue from selling crops can typically cover operating costs each year, net returns have often been negative. This suggests that, in some cases, allocated overhead costs are not covered. Corn’s net returns increased early in the decade, primarily due to a boom in the production of corn-based ethanol. Corn yields and acreage remained high after the boom, leaving supply high and leading, in part, to lower prices and returns over time. Net returns for soybeans shadowed those for corn during the ethanol boom, remaining higher than those for corn up until 2018. Wheat prices and returns also declined, due to strong international competition and several high-yield domestic crops. This chart is derived from data collected from the ERS Commodity Costs and Returns data product. Its data can also be viewed via ERS’s interactive data visualization product, U.S. Commodity Costs and Returns by Region and by Commodity.

Prevalence of U.S. food insecurity in 2019 dipped below pre-Great Recession level for the first time

Wednesday, September 9, 2020

USDA’s Economic Research Service (ERS) monitors the food security status of households in the United States through an annual nationwide survey. The most recent survey contains data collected in December 2019 for the year that preceded the COVID-19 pandemic. In 2019, 89.5 percent of U.S. households were food secure, meaning they had access at all times to enough food for an active, healthy life for all household members. The remaining households (10.5 percent) were food insecure at least some time during the year, including 4.1 percent that experienced very low food security. In households with very low food security, the food intake of one or more household members was reduced and their eating patterns were disrupted at times because the household lacked money and other resources for obtaining food. The 2019 prevalence of food insecurity, at 10.5 percent, was below the 2018 prevalence of 11.1 percent; it continued to show a decline from a high of 14.9 percent in 2011 and was significantly below the 2007 pre-Great Recession level of 11.1 percent. The prevalence of very low food security was not significantly different in 2019 from in 2018, 4.1 percent compared to 4.3 percent, respectively. This chart appears in ERS’s report, Household Food Security in the United States in 2019, released September 9, 2020.

Organic dairy farms had higher costs, but also higher gross returns, than conventional farms in 2016

Tuesday, September 8, 2020

Organic dairy production costs were substantially higher than those for conventional dairy in 2016—about 50 percent higher per hundredweight (cwt) of milk produced. Production costs include operating costs for feed, energy, and bedding, as well as the costs of capital and of the paid and/or family labor provided to the farm. Organic production costs were highest among farms with 10-49 cows at $48.87 per cwt, while production costs on conventional farms of that size were $33.54. Among farms with 100-199 cows in the herd, organic production costs amounted to $35.82 per cwt, while conventional farms in that category reported lower costs of $23.68. However, organic operations received much higher prices for their milk—organic gross returns per cwt of milk produced were about twice the gross returns realized by comparably sized conventional operations in 2016. With higher costs, but much higher gross returns, small organic dairy farms realized higher net returns on average than small conventional farms. (Net returns are the difference between gross returns and costs.) This chart appears in the Economic Research Service report, Consolidation in U.S. Dairy Farming, released July 2020. It also appears in the September 2020 Amber Waves finding, “Organic Dairy Farms Realized Both Higher Costs and Higher Gross and Net Returns Than Conventional Dairy Farms.”

Limes, lemons, and tangerines drove the 2007-18 growth in fresh citrus availability in the United States

Friday, September 4, 2020

In 2018, the total supply of fresh citrus fruits available for Americans to eat—after adjusting for spoilage, plate waste, and other losses in food stores, restaurants, and households—was 8.0 pounds per person. From 1970 to 2018, loss-adjusted per person availability of oranges and grapefruit fell by 51 and 84 percent, respectively, while availability of other citrus fruits grew—lemons, for example, doubled; limes increased by 22 times. Year-to-year changes in availability of citrus fruits reflect production swings due to weather events, citrus diseases, changes in import or export volumes, and other factors. Longer term trends, however, are usually driven by changes in consumer demand. For example, skipping breakfast—or making it a “grab and go” meal—is likely to reduce demand for fresh oranges and grapefruit. Grapefruit takes more effort to eat, especially when compared with easy-to-peel citrus fruits such as tangerines that are sweet in taste and smaller in size. The popularity of Hispanic, Asian, and other cuisines that use lemons and limes could be contributing to higher demand for these fruits. This chart appears in ERS’s Amber Waves article, “Citrus Fruits Accounted for 14 Percent of Fresh Fruits Available for Americans to Eat in 2018,” August 2020.

Farm sector profits forecast to rise in 2020

Wednesday, September 2, 2020

Inflation-adjusted U.S. net cash farm income (NCFI), defined as gross cash income less cash expenses, is forecast to increase $4.0 billion (3.6 percent) to $115.2 billion in 2020. U.S. net farm income (NFI)—a broader measure of farm sector profitability that incorporates noncash items including changes in inventories, economic depreciation, and gross imputed rental income—is forecast to increase $18.3 billion (21.7 percent) from 2019 to $102.7 billion in 2020. While cash receipts from farm commodities are forecast to decline $15.2 billion (4.1 percent), direct government farm payments are expected to increase $14.6 billion (64.4 percent) because of supplemental and ad hoc disaster assistance payments for COVID-19 relief in 2020. Additionally, total production expenses—that are subtracted out in the calculation of net income—are projected to fall $7.3 billion (2.1 percent) in 2020, contributing to the growth in income. If forecast changes are realized, NCFI would be 5.7 percent above its inflation-adjusted average calculated over the 2000-19 period, and NFI in 2020 would be 13.8 percent above its 2000-19 average. Find additional information and analysis on the USDA, Economic Research Service’s Farm Sector Income and Finances topic page, reflecting data released September 2, 2020.

U.S. agricultural imports have grown significantly over last quarter century

Monday, August 31, 2020

Errata: On September 4, 2020, this chart was reposted to correct a unit error in the y-axis label.

Over the last quarter century, the United States has become one of the largest agricultural importers in the world. During this time, imports have grown significantly from $27 billion in 1994 to $128 billion in 2019. The role of the North American Free Trade Agreement (NAFTA) in 1994—superseded by the United States-Mexico-Canada Agreement (USMCA) in July 2020—has played a central role in this surge, with U.S. imports from the North American region increasing more than six-fold from $8.2 billion in 1994 to $52 billion in 2019. The volume of imports from all regions has risen across all commodities, but consumer-oriented products, such as fresh fruits and vegetables, beef products, and wine and beer products have led the increase. Even as overall imports have grown, imports from Europe, as well as South America and the Caribbean, have dipped, reflecting the decreasing share of berries and other fruits provided by these countries, as well as additional sources of alcoholic beverages imported from USMCA trading partners. These charts are drawn from the Economic Research Service product, U.S. Agricultural Trade at a Glance.

U.S. food spending in June 2020 was $12 billion less than in June 2019

Friday, August 28, 2020

In 2019, before the COVID-19 pandemic, U.S. consumers, businesses, and government entities spent an average of $137.4 billion per month on food. Normal seasonal variations were present, with total food spending being lowest in January and February and highest in May, August, and December. Early 2020 followed the same pattern, with lower-than-average total food spending in January and February, but this trend continued into the spring with spending on food falling to $105 billion in April 2020, as spending at food-away-from-home establishments—restaurants, school cafeterias, sports venues, and other eating places—dropped to $36 billion. Spending on food-away-from-home rebounded in May and June but remained below 2019 spending in those months. Total food sales rose in May and June 2020 but were still lower than a year ago. Higher monthly sales at grocery stores, supercenters, convenience stores, and other food-at-home retailers compared with last year were not enough to compensate for the lower spending at food-away-from-home establishments. The data in this chart, along with more information on U.S. food sales and expenditures, can be found in the Economic Research Service’s Food Expenditure Series data product, updated August 20, 2020.

Productivity growth has contributed positively to U.S. agricultural output in all sub-periods since 1948

Wednesday, August 26, 2020

The total output—including livestock, crops, and other farm related outputs—produced by U.S. farms nearly tripled between 1948 and 2017, growing at an average annual rate of 1.53 percent. This output growth was primarily attributable to increased productivity, which grew at an average of 1.46 percent per year. Total inputs—including capital, land, labor, and intermediate goods—increased by 0.07 percent annually, by comparison. Though total input use grew slowly during this period, its composition shifted considerably. The use of intermediate goods (such as feed, seeds, and chemicals) increased by more than 130 percent, while agricultural labor declined by 76 percent and the amount of land devoted to agriculture was down by more than 25 percent. The continuing growth in intermediate goods contributed 0.58 percentage points per year to output growth, the highest among all inputs (capital, labor, and intermediate goods). However, the contribution of intermediate goods to output growth has been small (even negative in some years) since 1981. Over the long-term, productivity growth has been the major driver of agricultural growth. Productivity growth—spurred by innovations in animal and crop genetics, chemicals, equipment, and farm organization through research—is the only factor that contributed positively to agricultural growth in all sub-periods (measured from peak to peak between business cycles) since 1948. This chart appears in the July 2020 Amber Waves article, “Productivity Is the Major Driver of U.S. Farm Sector’s Economic Growth.”

Child food insufficiency in mid-July 2020 varied by State

Tuesday, August 25, 2020

To track rapid changes in the U.S. economic landscape during the COVID-19 pandemic, researchers at the Economic Research Service (ERS) teamed up with the U.S. Department of Commerce, Bureau of the Census and five other Federal agencies to produce the Household Pulse Survey. The survey ran from the week of April 23-28 to the week of July 16-21 in 2020. ERS researchers used a survey question asked during weeks 6 through 12 of the survey period about disruptions in the quantity of foods consumed by children to examine child food insufficiency for U.S. households. Households were classified as having children with food insufficiency if the survey respondent said that the children in the household were not eating enough “sometimes” or “often” in the last 7 days because the household could not afford enough food. The rate of child food insufficiency grew from a national average of 17.4 percent of U.S. households during June 4-9 to 19.9 percent at the survey’s end. During the final week of the survey, July 16-21, 18 States had child food insufficiency rates below 19.9 percent and 6 States had rates above the national average for July 16-21. The remaining 26 States and the District of Columbia had rates of food insufficiency statistically comparable to the national average. Child food insufficiency is similar in concept to the more detailed measure of “food insecurity among children” used in USDA’s annual assessments of food security to describe households that were unable at times to provide adequate, nutritious food for their children. According to USDA’s latest food security statistics, an estimated 7.7 percent of U.S. children were food insecure at some time during 2018. For more information on ERS’s food security research, see the Food Security in the U.S. topic page on the ERS website.

Soybean-to-corn price ratio signals increasing soybean profitability

Monday, August 24, 2020

The soybean-to-corn price ratio is often used as one of several tools in measuring profitability of soybeans and corn. The current ratio of U.S. soybean to corn prices has recently risen, sending a signal to farmers that the relative profitability of soybeans has increased over corn. Soybeans and corn are crops that compete for acreage in production and are complements in feed use. Their futures prices—the price of a contract to deliver a bushel of soybeans or corn at a certain time in the future—are used to calculate a ratio through dividing the soybean price by the corn price. Higher price ratios indicate that soybeans are relatively more profitable than corn. This ratio, which averaged 2.51 over the past 20 years, can tell farmers whether planting, harvesting, and storing one or the other crop might be advantageous. The ratio can also be used by livestock producers to indicate the price direction for feed ingredients. When the USDA, National Agricultural Statistics Service's June 2020 Acreage report indicated that less corn acreage had been planted than expected in early spring, futures prices for corn in marketing year 2020/21 increased by 8 percent. Soybean futures prices increased at the same time. Since late June, expectations of higher corn yields eroded the futures price for corn by 2.4 percent, while the price for soybeans increased by 1.1 percent. This differential in prices led to an increase in the soybean-to-corn price ratio from 2.64 to 2.71, a 2.5 percent increase from late June. This chart and associated data are drawn from the Economic Research Service’s Season-Average Price Forecasts data product.

Federal spending on food assistance in fiscal year (FY) 2019 at lowest level since FY 2009

Friday, August 21, 2020

USDA administers 15 domestic food and nutrition assistance programs that together form a nutritional safety net for millions of children and low-income adults. Federal expenditures on these programs totaled $92.4 billion in fiscal year (FY) 2019, their lowest level since FY 2009 and 22 percent less than the inflation-adjusted historical high of $117.9 billion set in FY 2013. The decline in spending between 2013 and 2019 was likely largely due to continued improvement in the U.S. economy, as the unemployment rate declined from 7.4 to 3.7 percent over that time period. Spending for the Supplemental Nutrition Assistance Program (SNAP), which accounted for almost two-thirds (65.3 percent) of Federal food and nutrition assistance spending in FY 2019, totaled $60.4 billion, or 8 percent less than in FY 2018 and 30 percent less than the inflation-adjusted historical high of $86.3 billion set in FY 2013. Expenditures fell for both SNAP and the Special Supplemental Nutrition Program for Women, Infants, and Children (WIC) between FYs 2018 and 2019, but increased between 2 and 3 percent for each of the three largest child nutrition programs—the National School Lunch Program, the School Breakfast Program, and the Child and Adult Care Food Program. A version of this chart appears in the Economic Research Service report, The Food Assistance Landscape: Fiscal Year 2019 Annual Report, July 2020.

A third of U.S.-grown potatoes become frozen french fries used mostly by food service

Wednesday, August 19, 2020

A little more than one-third of all potatoes grown in the United States are manufactured into frozen products, 85 percent of which are french fries. Spurred by decades of explosive growth within the quick service restaurant industry (QSRs), processed potato products, which include frozen, chipped, dehydrated, and canned, became the major movers in the potato market, led by frozen french fries. The share of potatoes consumed as frozen products rose from 27 percent in 1970-74 to 44 percent in 2015-19. Typically, about one-tenth of frozen french fries are sold in supermarkets and other retail outlets. The vast majority move through various food service venues or the export market. Research in the early 2000s indicated that QSRs alone accounted for about two-thirds of french fry usage, with another 6 percent attributed to school cafeterias. The COVID-19 pandemic severely hobbled the food service sector, resulting in an abrupt slowdown in french fry demand. In addition, exports of frozen potato products, which account for one-fourth of freezing potato utilization, remain well-below year-earlier levels. This chart is drawn from Economic Research Service’s Vegetables and Pulses Yearbook, March 2020.

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