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Farm share of retail price for whole milk was up in 2017

Thursday, October 4, 2018

Over the past decade, the farm share for a gallon of whole milk—the ratio of what dairy farmers received (farm price) to what consumers paid in grocery stores (retail price)—has fluctuated between 40 and 61 percent. It peaked at 61 percent in 2014 as higher U.S. exports of cheese, butter, and nonfat dry milk allowed farmers to collect higher prices for farm milk. However, U.S. exports weakened in 2015 with changes in international dairy markets and slower growth in global demand for dairy products. Exports of cheese, for example, decreased by 14 percent from 2014 to 2015. The farm price of whole milk fell from $2.26 per gallon in 2014 to $1.65 in 2015 before bottoming out at $1.51 in 2016, or 47 percent of the retail price. In 2017, the farm price of whole milk returned to $1.65 per gallon, and dairy farmers received 51 percent of whole milk’s retail price. According to ERS forecasts released in September 2018, the annual average price received by dairy farmers for milk may be less in 2018 than 2017, but is expected to increase through 2019. This chart is based on the Price Spreads from Farm to Consumer data product on the ERS website.

U.S. spending on food away from home continued to outpace food-at-home spending in 2017

Tuesday, September 25, 2018

U.S. consumers, businesses, and government entities spent $1.62 trillion on food and beverages in 2017. Spending at food-away-from-home establishments—restaurants, school cafeterias, sports venues, and other eating places—accounted for 53.8 percent of these expenditures, and the remaining 46.2 percent took place at grocery stores, supercenters, convenience stores, and other retailers. A 53.8-percent share of food expenditures does not equate to 53.8 percent of food quantities, as food purchased away from home is generally higher priced than food prepared at home. Food-away-from-home outlets incur costs for the workers required to prepare and serve food, as well as for buildings, equipment, and utilities. The away-from-home market, which accounted for about one-third of total food expenditures 50 years ago, saw its share grow through the decades, except in some recession years. During the 2007-09 recession, food away from home’s share of total food spending stayed at or just below 50 percent before surpassing its pre-recession share by rising to 50.2 percent in 2010 and continuing to grow to its 2017 share of 53.8 percent. The data for this chart are from the ERS report, Measuring the Value of the U.S. Food System: Revisions to the Food Expenditure Series, released on September 20, 2018.

SNAP participants spend less on restaurant foods than eligible nonparticipants

Thursday, August 23, 2018

In a recent study, ERS researchers used data from USDA’s 2012-13 National Household Food Acquisition and Purchase Survey (FoodAPS) to look at the factors that affect demand for convenience foods, including participation in USDA’s Supplemental Nutrition Assistance Program (SNAP). SNAP provides low-income households with monthly benefits to purchase food at authorized food stores. Estimates from the ERS study show that SNAP participants spend less on restaurant foods and more on foods from grocery stores relative to non-SNAP households that qualify for the program. SNAP participation was associated with a 26-percent higher level of ready-to-eat grocery store food purchases and a 21-percent higher level of purchases of non-ready-to-eat grocery store food, such as raw meats, seafood, dry beans, pasta, and other foods requiring cooking and preparation time. In addition, eligible non-SNAP households purchased almost twice as much full-service restaurant foods as SNAP households. The statistics for this chart are from the ERS report, Consumers Balance Time and Money in Purchasing Convenience Foods, June 2018.

Vegetable costs range from 17 cents to $2.47 per cup equivalent

Tuesday, August 21, 2018

“Add More Vegetables to Your Day” and “Vary Your Veggies” are among USDA’s key messages about how Americans can achieve healthier diets. However, many Americans still consume an insufficient quantity and variety of vegetables. One reason may be a lingering perception that vegetables are expensive. To address this perception, ERS recently estimated average retail prices paid in 2016 for 92 fresh and processed vegetables (including legumes), measured in cup equivalents. A cup equivalent is the edible portion that will generally fit in a 1-cup measuring cup; 2 cups for lettuce and other raw leafy greens. ERS researchers found that iceberg lettuce, fresh whole carrots, canned green beans, and 13 other products cost less than 40 cents per cup equivalent, while 55 vegetables, including baby carrots, frozen mixed vegetables, and canned tomatoes, cost between 40 and 79 cents per cup equivalent. Fresh asparagus, at $2.47 per cup equivalent, is the priciest of these 92 vegetables, and dried pinto beans at $0.17 are the least expensive. The data in this chart are from ERS's Fruit and Vegetable Prices data product, updated July 11, 2018.

Farm share of retail price of head lettuce rose in 2017

Thursday, August 9, 2018

The farm share of the retail price of head lettuce—the ratio of what farmers received to what consumers paid per pound in grocery stores—was 38 percent in 2017, the highest farm share since the 1990s. In 2017, while the national, monthly average price of head lettuce at grocery stores fell 3 cents to $1.03 per pound, the monthly average price received by farmers rose 12 cents to $0.37 per pound. ERS’s calculation of the farm share for head lettuce takes into account loss that occurs in grocery stores from spoilage and trimming by assuming that farmers supply a little less than 1.1 pounds for each pound sold at retail. Farm prices for head lettuce were particularly high during the first half of 2017. Flooding in California, brought on by heavy rains early in the year, delayed the planting and harvesting of head lettuce. California accounts for close to three-fourths of head lettuce production. Reduced supplies of head lettuce pushed farm prices higher, but had only a short-lived impact on retail prices. This chart appears in “Monitoring Trends in Retail Prices and Farm Shares of Food Products” in the August 2018 issue of ERS’s Amber Waves magazine.

Watermelon is the least expensive fruit on a per cup equivalent basis

Wednesday, August 1, 2018

Celebrating National Watermelon Day this Friday with a big slice of watermelon will be good for your health and for your food budget. ERS recently calculated average prices paid by consumers in 2016 for 62 fresh and processed fruits measured in cup equivalents. A cup equivalent is the edible portion that will generally fit in a 1-cup measuring cup; 1/2 cup for raisins and other dried fruits. Fresh watermelon at 20 cents per cup equivalent and apple juice (made from concentrate) at 26 cents per cup equivalent were the lowest priced fruits, while fresh blackberries, fresh raspberries, and canned cherries were the priciest. Twenty-nine fruits cost less than 80 cents per cup equivalent. Mechanical versus manual harvesting, distance the fruit travels to the store, perishability, and multiple other factors all play a role in fruit costs per cup equivalent. The data in this chart are from ERS's Fruit and Vegetable Prices data product, updated July 11, 2018.

Households with children make tradeoffs between time and money in their purchases of restaurant meals

Thursday, July 26, 2018

Childcare requires a lot of time, and some households respond to this constraint by cutting back on time spent shopping for food, cooking, and cleaning up afterwards. ERS researchers used data from USDA’s 2012-13 National Household Food Acquisition and Purchase Survey (FoodAPS) to look at the factors that affect demand for convenience and found that households with two children spent 48 percent of their food budgets on restaurant food, while households without children spent only 41 percent. Longer waiting times for food and less child-friendly settings and menu offerings may be among the reasons that households with children spent less on full-service restaurant meals than those without children, regardless of the number of children. As the number of children increases, the monetary cost of eating out seems to outweigh the time savings, especially for households with more than two children. Households with one child spent 37 percent of their food budget on fast food, while households with two children spent 40 percent. The share spent on fast food did not increase after two children. A version of this chart appears in the June 2018 Amber Waves article “Higher Incomes and Greater Time Constraints Lead to Purchasing More Convenience Foods."

Food prices less volatile than transportation prices

Wednesday, July 18, 2018

The 1970s were a decade of volatile prices for consumers’ top three spending categories—housing, transportation, and food. Annual food price inflation during the 1970s averaged 8.1 percent, and food prices rose by 10 percent or more in 3 of the 10 years. Yearly price changes for housing costs, which include rents, utilities, and household furnishings, averaged 7.6 percent during the decade and peaked at 15.7 percent in 1980. And price changes for transportation (prices of vehicles, gasoline and diesel fuel, and public transportation) topped 10 percent in 1974, 1976, and 1979 and jumped 17.9 percent in 1980. Since that time, prices for food and housing have become comparatively more stable than transportation prices, which continue to be volatile from year to year. Food prices in 2016 and 2017 changed little as decreasing prices for food commodities and energy offset rising costs for other food processing, marketing, and food service inputs. At the same time, a strong U.S. dollar lowered the cost of imported foods. This chart appears in “Five Decades of Price Swings for Food and Other Consumer Spending Categories” in the July 2018 issue of ERS’s Amber Waves magazine.

Home-grilled cheeseburger costs are beefier today than they were 20 years ago

Monday, July 2, 2018

If cheeseburgers are on your menu for July 4, they will cost you 20 percent more than their inflation-adjusted cost from 20 years ago. And that greater cost is due to higher ground beef prices. In 2018, the ingredients for a home-prepared, quarter-pound cheeseburger total $1.69, with ground beef making up the largest cost at $0.92. This same cheeseburger would have cost $0.91 to prepare in 1998, the equivalent of $1.40 in 2018 dollars, with ground beef accounting for $0.55 in 2018 dollars. Today’s higher ground beef prices in grocery stores likely reflect cattle supply disruptions in the early 2000s and early 2010s, resulting in higher-than-average increases in retail ground beef prices during those years. Although U.S. beef production has since increased, prices are slower to retreat at the retail level. In contrast, efficiencies throughout the food supply chain helped lower prices for the other cheeseburger ingredients. Inflation-adjusted retail bread prices between 1998 and 2018 fell by 2.8 percent, tomato prices by 12.3 percent, lettuce prices by 27.9 percent, and cheddar cheese prices by 5.7 percent. More information on ERS’s food price forecasts can be found in ERS’s Food Price Outlook data product, updated June 25, 2018.

Time constraints due to employment are associated with greater preference for convenience foods

Thursday, June 28, 2018

When consumers are pressed for time because of employment demands, many respond by spending less time on food shopping, preparation, and clean up. In a recent study, ERS researchers used data from USDA’s 2012-13 National Household Food Acquisition and Purchase Survey (FoodAPS) to look at the factors that affect demand for convenience food. The researchers found that households that are time constrained by employment spent more on restaurant food and less on grocery store food. Households where all adults were employed spent about half of their food budgets at restaurants, whereas households where a primary shopper was unemployed spend only 36 percent. The share of the food budget spent on non-ready-to-eat foods, such as raw meats, seafood, dry beans, pasta, and other foods requiring cooking and preparation time, also presents a picture of households making a tradeoff between time and money. Households where all adults were employed spent 10 percentage points less of their food budgets on non-ready-to-eat foods compared to households where a primary shopper was not employed. The statistics for this chart are from the ERS report Consumers Balance Time and Money in Purchasing Convenience Foods, released on June 27, 2018.

Calorie availability and importance of food in household spending are inversely related

Thursday, June 14, 2018

Countries vary in how much their citizens spend on food at home as a share of consumption expenditures. (Consumption expenditures include all household spending, but not savings.) In high-income countries such as the United States and the United Kingdom, spending shares on food at home are low because food is less expensive compared to other spending categories, people eat out more often, and incomes are high. In 2016, these two countries spent less than 10 percent of their consumption expenditures on food purchased from supermarkets and other food stores. In Kenya and other low-income countries, at-home food’s share of consumption expenditures can exceed 50 percent. Per capita calorie availability follows the reverse pattern. According to the most recent available data, U.S. per capita calorie availability was among the highest at 3,682 calories per day, while Kenya’s was estimated at only 2,206 calories per day, reflecting differences between the countries in supplies of food available for people to eat. This chart appears in ERS’s web product, Ag and Food Statistics: Charting the Essentials.

Recent food price inflation in line with overall inflation

Thursday, May 17, 2018

From 2013 to 2017, the Consumer Price Index (CPI) for all food (grocery store and restaurant food) rose by 5.5 percent. This increase was relatively in line with the 5.2-percent rise in the all-items CPI, indicating that food prices were rising only moderately faster than prices for consumer goods and services as a whole. Over the last couple years, rising restaurant prices have contributed to food price inflation outpacing prices for recreation, education and communication, apparel, and transportation. Apparel and transportation prices actually declined from 2013 to 2017. Medical care and housing were the only two major consumer spending categories whose prices rose faster than food prices during this time period. Food-price inflation outpacing economy-wide inflation is not a recent phenomenon. Over the last decade, food-price inflation averaged 2.1 percent per year and overall inflation averaged 1.7 percent per year. Price inflation for food at home, however, averaged 1.8 percent per year during 2013-17, in line with economy-wide inflation. This chart appears in ERS’s data product, Ag and Food Statistics: Charting the Essentials.

Close to 90 percent of U.S. consumers’ food and beverage spending is for domestically produced products

Monday, May 14, 2018

In 2016, 87.3 percent of food and beverage purchases by U.S. consumers, including both grocery store and eating out purchases, were from domestic production. The remaining 12.7 percent were imported food and beverages such as produce from Chile or wines from France. Imports’ share of the U.S. food and beverage dollar has almost doubled over the last two decades from 6.9 percent in 1993, due in part to growing demand by U.S. consumers for year-round fresh produce options and increasing global trade in food and beverages. Imported inputs are used in U.S. food and beverage production, and their share of the U.S. food and beverage dollar has also risen. Imported inputs used by U.S. food companies and restaurants include both food inputs, such as avocadoes from Mexico and cranberries from Canada, and non-food inputs such as natural gas and foreign-made restaurant equipment. In 2016, imported inputs used in domestically produced food and beverages accounted for 4.7 percent of the U.S. food and beverage dollar, up from 3.7 percent in 1993. The data for this chart are from ERS’s Food Dollar Series data product.

Nutrition scores for Americans’ food acquisitions vary by source

Wednesday, May 9, 2018

Using data from USDA’s National Household Food Acquisition and Purchase Survey (FoodAPS), ERS researchers calculated nutrition scores for foods purchased or acquired for free by three groups: participants in USDA’s Supplemental Nutrition Assistance Program (SNAP), low-income non-SNAP households, and higher income non-SNAP households. For the scores, the researchers used the Healthy Eating Index-2010, which is a measure of dietary quality that assesses conformance to the 2010 Dietary Guidelines for Americans. Scores run from 0 to 100 and summarize how well the week’s foods compare to Federal dietary recommendations—a higher score reflects a healthier diet. Foods acquired at large grocery stores were more nutritious than foods from smaller stores or from restaurants and other eating places. However, grocery store purchases by SNAP households scored 4 and 8 points below purchases by low-income and higher income non-SNAP households, respectively. For SNAP households, school food rivaled large grocery stores for nutritional quality. This is likely because meals served as part of USDA’s school lunch and breakfast programs must meet Federal nutrition standards. SNAP participants are eligible for free or reduced-price school meals and likely rely more on these meals and less on snacks and other items sold in schools that are not required to meet the same nutrition standards as USDA school meals. A version of this chart appears in the February 2018 Amber Waves article, "Supermarkets, Schools, and Social Gatherings: Where Supplemental Nutrition Assistance Program and Other U.S. Households Acquire Their Foods Correlates With Nutritional Quality."

Distance to grocery stores and vehicle access affect low-income shoppers’ food spending

Monday, April 30, 2018

Difficulty accessing large grocery stores may increase a household’s reliance on smaller stores and restaurants, possibly resulting in a diet of low-nutritional quality and related health problems. ERS researchers used data captured in USDA’s National Household Food Acquisition and Purchase Survey (FoodAPS) to examine if differences in how far low-income households live from large grocery stores and whether they own a car influences their food spending behaviors. Among low-income households, the researchers found that access-burdened and sufficient-access households spent similar shares of their weekly food spending at grocery stores (57-58 percent) and at small grocery, ethnic, and specialty food stores (3-5 percent). Differences between the two low-income access groups did arise in spending at convenience, dollar, drug, and other small stores and at eating places. Access-burdened households spent a higher share of their food expenditures at convenience, dollar, drug, and other small stores than sufficient-access households and a smaller share of their food budgets at eating places. In 2012, 26.4 percent of U.S. households were low-income sufficient-access households and 4.7 percent were low-income access-burdened. This chart is from "Distance to Grocery Stores and Vehicle Access Influence Food Spending by Low-Income Households at Convenience Stores," in the March 2018 issue of ERS’s Amber Waves magazine.

Retail price changes for most food categories were small in 2017

Tuesday, April 24, 2018

With the exception of eggs, 2017 was a year of relative stability for grocery store prices. Lower agricultural commodity prices and a relatively strong U.S. dollar (which can make imported foods less expensive) contributed to smaller than average price increases and, for some foods, price decreases. The largest increase was for fish and seafood prices, which rose 1.2 percent—still well below the category’s 20-year historical average of 2.5 percent per year. Beef and veal prices fell 1.2 percent, cereals and bakery products were down 0.5 percent, and retail prices for sugars and sweets and fresh vegetables both fell by 0.1 percent in 2017. The food category with the largest price change in 2017 was eggs—a category prone to yearly price swings. Retail egg prices fell 9.5 percent in 2017, as egg production continued to recover from lows in 2015 due to the Highly Pathogenic Avian Influenza. Eggs account for 1.3 percent of food-at-home spending, so their large price swings have muted effects on overall grocery store inflation. This chart appears in an ERS data visualization, Food Price Environment: Interactive Visualization, released February 2018.

Farm share of U.S. food dollar declined again in 2016

Thursday, April 12, 2018

On average, U.S. farmers received 14.8 cents for farm commodity sales from each dollar spent on domestically-produced food in 2016, down from 15.5 cents in 2015. Known as the farm share, this amount is at its lowest level for the period 1993 to 2016, and coincides with a steep drop in 2016 average prices received by U.S. farmers, as measured by the Producer Price Index for farm products. ERS uses input-output analysis to calculate the farm and marketing shares from a typical food dollar, including food purchased at grocery stores and at restaurants, coffee shops, and other eating out places. 2016 was the fifth consecutive year that the farm share has declined, though the 4.5-percent drop in 2016 was below 2015’s 9.9-percent fall. The drop in farm share also coincides with five consecutive years of increases in the share of food dollars paying for services provided by the foodservice industry. Since farmers receive a smaller share from eating out dollars, due to the added costs for preparing and serving meals, more food-away-from-home spending will also drive down the farm share. The data for this chart can be found in ERS’s Food Dollar Series data product, updated on March 14, 2018.

Grocery store food prices fell 0.2 percent in 2017

Thursday, February 22, 2018

2017 marked the second consecutive year that average grocery store prices declined. At-home food prices in 2017 were 0.2 percent lower than 2016 prices. This decline followed a larger 1.3-percent drop in 2016—the first decline in annual grocery store prices since 1967. In contrast to falling food prices, overall inflation (prices for all goods and services, including food) rose by 1.3 percent in 2016 and by 2.1 percent in 2017. During 2016-17, lower food-at-home prices were driven, in part, by increased U.S. production of agricultural commodities, such as beef cattle and eggs, lower transportation costs due to lower oil prices, and a strong U.S. dollar which can make imported foods less expensive. Grocery store price changes can be volatile year to year, however the 20-year moving average, or average price change for the previous 20 years, has been slowly declining from 4 percent in 1998 to 3.1 percent in 2008 to 2.1 percent in 2017. More information on ERS's food price forecasts can be found in ERS's Food Price Outlook data product, updated February 22, 2018.

Millennials devote a higher share of their at-home food budgets to  prepared foods

Tuesday, February 6, 2018

Millennials are now the largest living generation—surpassing Baby Boomers—in the United States. Their large collective buying power is only expected to expand as their earnings increase as they age. Food retailers, for example, increasingly respond to preferences for grocery store foods that are ready-to-eat or just need to be heated before consuming—preferences that Millennials clearly display. A recent ERS study found that across almost all income ranges, Millennials assigned more of their food-at-home budgets to prepared foods, such as canned soup or deli rotisserie chicken, when compared to older generations. With the exception of households with incomes of $20,000 to $28,332 per household member, the share of food-at-home expenditures devoted to prepared foods stayed relatively constant for Millennial-headed households at 7.5 to 8 percent. In contrast, Traditionalists, the oldest generation represented, generally allocated the least amount of their food budgets to prepared foods, with a small decline in the share for households with higher per capita incomes. This chart appears in "Millennials Devote Larger Shares of Their Grocery Spending to Prepared Foods, Pasta, and Sugar and Sweets Than Other Generations," in the December 2017 issue of ERS’s Amber Waves magazine.

Millennials spend less per person than other generations on grocery store foods

Friday, January 19, 2018

A recent ERS analysis of 2014 grocery store data found that compared to older generations, Millennial-headed households spent the least per person on food at home. However, like the other generations analyzed, Millennial households with higher incomes tended to spend more on grocery store foods than Millennial households with lower incomes. This is likely because poorer households have less income to spend on food at home. Even with this lower spending, lower income households still spend a higher share of their total food budgets in grocery stores. Traditionalists and Baby Boomers spent more per person on food at home in each of 10 income groups than Millennials and Gen X’ers. For example, of households earning between $14,000 and $20,000 per household member annually, Millennials spent just under $80 per month per person on food at home and Gen X’ers spent $85, whereas Baby Boomers in that income group spent $135 and Traditionalists spent $154. Differences in food-at-home spending between the generations may reflect the younger generations’ stronger preference for eating out, which may change as they age. A version of this chart appears in the ERS report, Food Purchase Decisions of Millennial Households Compared to Other Generations, released on December 29, 2017.

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