ERS Charts of Note
Monday, May 17, 2021
In 2019, restaurants and other eating places claimed 38.5 cents of the average U.S. food dollar, continuing a steady climb since 2009, when the food services industry’s share was 29.6 cents. Farm production was the only other industry with a rising food dollar share in 2019, up slightly to 7.6 cents from its 25-year low of 7.4 cents in 2018. The proportion of the food dollar was the smallest since 1993 for several industries in 2019: agribusiness (such as fertilizer and farm services), food processing, packaging, wholesale trade and retail trade. The 2019 food dollar reflects conditions before the COVID-19 pandemic. ERS’s annual Food Dollar Series provides insight into the industries that make up the U.S. food system and their contributions to total U.S. spending on domestically produced food. ERS uses input-output analysis to calculate the cost contributions from 12 industry groups in the food supply chain. Annual shifts in the food dollar shares between industry groups occur for a variety of reasons, including changes in the mix of foods consumer buy, costs of materials, ingredients, and other inputs, as well as changes in the balance of food at home and away from home. This chart is available for the years 1993 to 2019, and can be found in ERS’s Food Dollar Series data product, updated on March 17, 2021.
Friday, April 16, 2021
The Supplemental Nutrition Assistance Program (SNAP) Online Purchasing Pilot began in 2019 as mandated by the 2014 Farm Act and was quickly expanded in 2020 in response to the COVID-19 pandemic. The pilot allows households in participating States to use their SNAP benefits to purchase groceries online from a limited number of authorized retailers. Households can similarly use Pandemic Electronic Benefit Transfer (P-EBT) benefits, which were issued in 2020 to households with children missing free and reduced-price school meals during the pandemic. Online transactions using benefits are subject to the same requirements as in-person transactions and cannot be spent on tips or fees. The number of States where SNAP and P-EBT benefits could be redeemed online grew from just one State at the beginning of 2020 to 46 States by the end of September 2020. As availability increased and the pandemic necessitated continued social distancing, the value of SNAP and P-EBT benefits redeemed online increased. In February 2020, households redeemed less than $3 million in benefits online, accounting for less than 0.1 percent of all benefits redeemed. By September, this amount grew to $196 million — 67 times its value in February. Overall, households redeemed $801 million in benefits online from February to September 2020. Despite this rapid growth, online redemptions accounted for only 2.4 percent of all benefits redeemed in September. This chart is based on a chart in the USDA, Economic Research Service’s COVID-19 Working Paper: Supplemental Nutrition Assistance Program and Pandemic Electronic Benefit Transfer Redemptions during the Coronavirus Pandemic, released March 2021.
Thursday, April 8, 2021
The U.S. Government expanded existing food assistance programs and introduced new ones in response to the COVID-19 pandemic and subsequent economic contraction in the United States in 2020. Some States began issuing monthly supplemental emergency allotments to Supplemental Nutrition Assistance Program (SNAP) households in March 2020, with the rest beginning to do so in April 2020. All States issued Pandemic Electronic Benefit Transfer (P-EBT) benefits to households with children who missed free or reduced-price school meals during the 2019-20 school year; the earliest States began issuing P-EBT benefits in April 2020. This led to a rapid increase in the dollar amount of food assistance benefits issued to households and redeemed for groceries during the pandemic. The value of total monthly redemptions roughly doubled from $4.7 billion in March 2020 to $9.5 billion in June 2020. Most P-EBT benefits for the 2019-20 school year were issued in May and June 2020, leading total redemptions to peak in June and decline over the next three months. By September, redemptions amounted to $8.1 billion. Overall, an average of $8.4 billion per month in combined SNAP and P-EBT benefits were redeemed from April through September 2020—an increase of 74 percent compared with the average value of benefits redeemed during the same 6 months in 2017-19. This chart is based on a chart in the USDA, Economic Research Service’s COVID-19 Working Paper: Supplemental Nutrition Assistance Program and Pandemic Electronic Benefit Transfer Redemptions during the Coronavirus Pandemic, released March 2021.
Wednesday, March 31, 2021
On average, U.S. farmers received 14.3 cents for farm commodity sales from each dollar spent on domestically produced food in 2019, up from a newly revised estimate of 14.2 cents in 2018. Known as the farm share, this amount increased slightly after 7 consecutive years of decline. Average prices received by U.S. farmers (as measured by the Producer Price Index for farm products) have been relatively stable for the last three years, following sharp declines in 2015 and 2016. The USDA, Economic Research Service (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 eating-out establishments. The marketing share covers the costs of getting domestically produced food from farms to points of purchase, including costs related to packaging, transporting, processing, and selling to consumers at grocery stores and eating-out places. The farm and marketing shares of the food dollar in 2019 reflect conditions before the COVID-19 pandemic. Beginning in March 2020, the ERS monthly Food Expenditure Series reported sharp declines in the share of eating-out food dollars. Farmers receive a smaller share from eating-out dollars because of the added costs for preparing and serving meals at restaurants, cafeterias and other food-service establishments. The data for this chart can be found in ERS’s Food Dollar Series data product, updated March 17, 2021.
Wednesday, March 24, 2021
The share of food dollars spent at grocers, supercenters, and other food-at-home (FAH) retailers in the United States rose in 2020 above Great Recession levels in 2008 as the COVID-19 pandemic disrupted the way people consumed food. The share of spending at FAH establishments began a sharp climb from 48 percent in February 2020, and by April 2020, 66 percent of food spending was devoted to at-home consumption. Shifts to greater FAH spending occurred as states issued stay-at-home mandates and people generally avoided public gatherings. The economic recession likely exacerbated this shift as FAH purchases are more cost-efficient. Even after its April 2020 peak, the share of FAH spending reached the same level in August 2020 as it was in August 2008, during the Great Recession. After that, food spending shares generally followed typical seasonal patterns, although at a level more like the Great Recession than 2018, remaining stable with a slight increase in FAH spending in the colder, winter months. ERS researchers will continue to examine food expenditure data to determine whether this change will endure beyond the pandemic and recession. The data for this chart come from the USDA, Economic Research Service’s Food Expenditure Series data product.
Wednesday, February 17, 2021
Food prices increased more rapidly than average in 2020, as the COVID-19 pandemic prompted shifts in consumption patterns and supply chain disruptions. However, researchers at the USDA, Economic Research Service (ERS) expect food price inflation to retreat over the course of 2021 and converge closer to the 20-year historical average. During the pandemic, supply chains pivoted from servicing restaurants to stocking retailers, primarily grocery stores. COVID-19 outbreaks disrupted agricultural production and processing, particularly in the meat sector, leading to reduced supply and higher prices. Societal and economic response to the pandemic will continue to influence food prices in 2021, and uncertainties about the future of disease transmission, stay-at-home orders, and vaccinations introduce challenges to forecasting food price inflation. Restaurant re-openings, supply chain adjustments, rates of unemployment, and shifting safety net programs may all affect food prices. Over time, inflation tends to revert to historical averages as years of high rates of inflation are often succeeded by years of low inflation. The years following the 2008 and 2011 price spikes offer examples of this pattern. This trend suggests food price inflation rates are likely to decrease in the wake of the COVID-19 pandemic, but there is substantial uncertainty about the rate of decline. Using data from the U.S. Bureau of Labor Statistics’ Consumer Price Index, ERS researchers project retail food prices will increase between 1 and 2 percent in 2021, at or below the 20-year average of 2 percent. More information on ERS’s monthly food price forecasts can be found in the ERS Food Price Outlook data product, which will be updated February 25, 2021.
Wednesday, January 13, 2021
From 2010 through 2019, retail—or grocery—food prices rose an average of 1.2 percent a year nationally. However, food-at-home price inflation varies by locality. Retail food prices rose an average of 1.7 percent a year in Honolulu over the decade, while price inflation in the Dallas-Fort Worth area averaged 0.6 percent a year. Averaging 10 years of annual data smooths out year-to-year “noise”—volatile price swings that are not indicative of the overall trend. Differences in transportation costs and retail overhead expenses, such as labor and rent, can explain some of the variation among cities because retailers often pass local cost increases on to consumers in the form of higher prices. Furthermore, differences in consumer preferences among cities for specific foods may help explain variation in inflation rates. For example, a city whose residents strongly prefer foods with less price inflation (such as fresh fruits and vegetables at 1.1 percent a year in 2010–19) might experience lower food-at-home price inflation than a city whose residents buy more beef and veal, which increased an average of 3.6 percent a year in 2010–19. This chart appears in an Economic Research Service data visualization, Food Price Environment: Interactive Visualization, released September 2020.
Friday, December 11, 2020
In 1960, U.S. consumers spent an average of 17.0 percent of disposable personal income (DPI) on food. By 2019, this share had shrunk to 9.5 percent. This decrease was driven by a decline in the share of income people spent on food at home. The share of DPI spent on food purchased at supermarkets, supercenters, convenience stores, and other retailers fell from 13.7 percent in 1960 to 5.7 percent in 2000. Over the same period, the share of DPI spent on food purchased from restaurants, fast-food places, schools, and other away-from-home eating places rose from 3.3 percent to 4.2 percent. The declining share of income spent on food at home reflects, in part, efficiencies in the U.S. food system (which kept inflation for food-at-home prices generally low) and rising disposable incomes. A slower decline in share of income spent on food at home after 2000 could reflect U.S. consumers opting to prepare more meals at home and purchasing more expensive grocery store options than they did in earlier decades. This chart appears in “Average Share of Income Spent on Food in the United States Remained Relatively Steady From 2000 to 2019,” in the Economic Research Service’s Amber Waves magazine, November 2020.
Friday, December 4, 2020
The farm share of the retail price of all-purpose white flour—the ratio of the price farmers receive for wheat to the price consumers pay for flour in grocery stores—averaged 13 to 14 percent in 2016 and 2017 before reaching 19 and 20 percent in 2018 and 2019. In the latter half of 2017, farm prices rose in connection with lower-than-expected U.S. wheat production. In mid-2018, as the 2017/18 U.S. wheat crop matured, dry conditions in the Northern Plains further trimmed wheat production prospects. In response, domestic wheat prices rose again, despite abundant global wheat supplies. Ultimately, U.S. wheat farmers received an average price of $4.72 per bushel for their 2017/18 crop, up from $3.89 in the previous year. The farm value of the amount of hard red winter wheat needed to make one pound of all-purpose white flour increased from 7 cents in 2017 to 9 cents in 2018 before falling back to 8 cents in 2019. The average retail price of flour fell from 51 cents per pound in 2017 to 46 cents in 2018 and 44 cents in 2019. Costs for milling, packaging, transporting, and retailing also affect what consumers pay for flour at grocery stores. The Economic Research Service (ERS) forecasts higher farm prices for wheat during the 2020/21 marketing season and moderately higher retail prices for cereal and bakery goods, a category of products that includes all-purpose white flour, through 2020 and 2021. This chart is based on the Price Spreads from Farm to Consumer data product on the ERS website.
Tuesday, November 10, 2020
Households spend more money on food as their incomes rise, but the amount spent represents a smaller share of their overall budgets. In 2019, households in the lowest income quintile, with an average 2019 after-tax income of $12,236, spent an average of $4,400 on food (about $85 a week). Households in the highest income quintile, with an average 2019 after-tax income of $174,777, spent an average of $13,987 on food (about $269 a week). The three-fold increase in spending between the lowest and highest income quintiles is not the result of a three-fold increase in consumption, however. Rather, as people gain more disposable income, they often shift to more expensive food options, including dining out. Even with this shift, as income increases, the percent of income spent on food goes down. In 2019, food spending represented 36.0 percent of the lowest quintile’s income, 14.1 percent of income for the middle quintile, and 8.0 percent of income for the highest quintile. The statistics in this chart predate the coronavirus pandemic and its impacts. This chart appears in the Food Prices and Spending section of the Economic Research Service’s Ag and Food Statistics: Charting the Essentials data product.
Wednesday, October 28, 2020
The share of U.S. food expenditures occurring at grocery stores, supercenters, and other food-at-home retailers typically displays a consistent seasonal pattern. U.S. consumers devote relatively more money to food-at-home spending in the winter months—a time of Thanksgiving and holiday gatherings. The summer months see the highest share of spending at food-away-from-home places such as restaurants, cafeterias, and other eating-out places. While seasonal patterns have stayed constant until 2020, the share of total food spending dedicated to food at home has not. In 1998, food at home’s share was above 55 percent of total food spending throughout the year. Ten years later, 2008 saw the share of food spending devoted to food at home decrease a few percentage points despite the Great Recession of 2007-2009. In 2018, food at home’s share was below 50 percent in all but the winter months. The COVID-19 pandemic has upended past seasonal trends and expanded food at home’s share of total food spending. Food at home in August 2020 accounted for 54 percent of total food spending, after peaking at 66 percent in April 2020. The data for this chart come from the Economic Research Service’s Food Expenditure Series data product, updated October 16, 2020.
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.
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.
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.
Friday, August 7, 2020
The COVID-19 pandemic and resulting stay-at-home orders dramatically impacted Americans’ food spending in spring 2020. Inflation-adjusted expenditures at grocery stores, supercenters, convenience stores, and other food-at-home retailers were 19.3 percent higher in March 2020 compared with March 2019. This same spending was 3.1 percent higher in April 2020 than in April 2019, and 3.9 percent higher in May 2020 than in May 2019. Comparing spending for the same month accounts for seasonal food spending patterns. Inflation-adjusted March 2020 expenditures at eating-out establishments—restaurants, school cafeterias, sports venues, and other eating-out places—were 28.3 percent lower than March 2019 expenditures. In April and May 2020, food-away-from-home spending was down 50.8 and 37.2 percent, respectively, when compared to the same months one year ago. During the Great Recession of 2007-09, expenditures on both food at home and food away from home decreased, with the largest decrease occurring in February 2009. Unlike previous economic shocks, COVID-19 led to a pronounced substitution from food away from home to food at home in part due to the spring 2020 stay-at-home orders and the fact that many eating-out businesses were operating at a limited capacity or had ceased operations completely. The data in this chart are from the Economic Research Service’s Food Expenditure Series data product, updated July 21, 2020.
Monday, July 27, 2020
Grocery store prices were 5.6 percent higher in June 2020 compared with June 2019. Retail prices increased for all food-at-home categories except for fresh fruits. Many of these increases were influenced by the coronavirus pandemic. The pandemic disrupted supply chains of several commodities—and affected consumers’ food spending patterns—which put upward pressure on wholesale and retail food prices. The spring 2020 closing of schools and stay-at-home orders resulted in the dairy industry having to shift from supplying products for schools and restaurants to supplying products for grocery stores and other food retailers (food at home). Adapting to this transition placed upward pressure on retail prices for dairy products, which rose by 5.1 percent from June 2019 to June 2020. Beef also experienced supply chain disruptions: decreased slaughter volumes due to COVID-19 led to a bottleneck in supply which boosted prices. Retail beef and veal prices in June 2020 were 25.1 percent higher than in June 2019. Much of this increase occurred after February 2020. Other commodities also saw increases in retail prices. Egg prices increased 12.1 percent since June 2019, and pork and poultry prices increased 11.8 and 8.7 percent, respectively. The data for this chart come from the Economic Research Service’s Food Price Outlook data product, updated July 24, 2020.
Friday, July 24, 2020
In 2019, U.S. consumers, businesses, and government entities spent $1.8 trillion on foods and beverages, according to the Economic Research Service’s (ERS) Food Expenditure Series. Expenditures at food-away-from-home establishments—restaurants, school cafeterias, sports venues, and other eating places—totaled $969.4 billion in 2019, compared to the $799.4 billion spent on food at home in grocery stores, supercenters, convenience stores, and other retailers. Full-service restaurants with wait staff and limited-service restaurants—where food is ordered and paid for at a counter or drive-thru window—dominate the U.S. food-away-from-home market. Each of these sectors accounted for over a third of food-away-from-home expenditures in 2019. Schools and colleges accounted for 7.3 percent of food-away-from-home expenditures in 2019, followed by retail stores and vending machines (4.1 percent), hotels and motels (4.0 percent), recreational places (3.5 percent), and drinking places and other food-away-from-home sales (3.2 percent). Spending on food furnished in hospitals and in group quarters—such as meals served in military barracks, prisons, and nursing homes—and the value of food commodities donated by the Federal Government totaled $47.6 billion in 2019 and accounted for 4.9 percent of food-away-from-home expenditures. While the data in this chart predate the COVID-19 pandemic, they can provide insight into its potential impact on the food-away-from-home market. The stay-at-home orders that accompanied the pandemic have caused a drop in spending on eating out, and some food-away-from-home sectors have been more affected than others. The data in this chart are from ERS’s Food Expenditure Series data product.
Wednesday, July 15, 2020
Disruptions to food production and changes in demand due to the COVID-19 pandemic may impact prices for farm products. However, farm price swings generally have less impact on food prices as food gets closer to the dinner table. In 2009, the last year of the Great Recession, the production-weighted farm price of the field crops corn, wheat, and soybeans decreased by 20 percent. That same year, the Producer Price Index for intermediate foods and feeds, such as wheat flour and soybean oil, fell 9 percent. Retail food prices—including foods purchased in stores and eating places—rose 2 percent. Converting farm commodities into consumer foods, such as corn flakes and restaurant meals, requires additional production inputs such as labor, energy, packaging, transportation, and marketing. Thus, farm commodity prices are a small piece of retail food prices, particularly for highly processed products and restaurant offerings. Another reason retail food prices tend to be less volatile than farm and wholesale prices is the structure of the grocery retail industry, with large chains often using marketing contracts to smooth price spikes in the products they purchase and keep retail food prices more stable. While the data in this chart predate the COVID-19 pandemic and do not reflect its impacts on food supply chains and food demand, examining past food-price dynamics can provide insight into current events. This chart appears in the Economic Research Service’s May 2020 Amber Waves article, “Retail Food Prices Less Volatile Than Farm and Wholesale Prices.”
Friday, June 5, 2020
Errata: On July 22, 2020, this Chart of Note was reposted with corrected data for February 2020 and March 2020.
The COVID-19 pandemic and resulting stay-at-home orders have dramatically impacted Americans’ food spending. Inflation-adjusted expenditures at grocery stores, supercenters, convenience stores, and other retailers (food at home) were 6.7 percent higher in February 2020 compared with February 2019. This same spending was 19.3 percent higher in March 2020 compared with March 2019. Comparing spending for the same month accounts for seasonal food spending patterns. Inflation-adjusted February 2020 expenditures at eating-out establishments—restaurants, school cafeterias, sports venues, and other eating-out places—were 3.1 percent higher than February 2019 expenditures. March 2020 food-away-from-home spending was 28.3 percent lower than March 2019 spending. During the Great Recession of 2007-09, expenditures on both food at home and food away from home decreased, with the largest decrease in February 2009. Unlike previous economic shocks, the COVID-19 shock has led to a pronounced substitution from food away from home towards food at home. This substitution is in part due to the stay-at-home orders and the fact that many eating-out businesses are operating at a limited capacity or have ceased operations completely. The data in this chart are from the Economic Research Service’s Food Expenditure Series data product, updated June 2, 2020.
Friday, April 24, 2020
In 2018, restaurants and other eating-out places claimed 37.4 cents of the U.S. food dollar—foodservices’ highest share during the 1993 to 2018 period covered by the Economic Research Service’s (ERS’s) Food Dollar Series and the seventh consecutive annual increase. More eating out in 2018 was also reflected in the 12.3-cent retail-trade share claimed by grocery stores and other food retailers, which was at its lowest level in the 1993-2018 period. The only other industry groups that showed an increasing food dollar share in 2018 were farm producers, up 0.3 cents to 8 cents in 2018, and energy industries, such as electric power and natural gas, which increased their share for the third consecutive year, up to 4.2 cents. ERS’s annual Food Dollar Series provides insight into the industries that make up the U.S. food system and their contributions to total U.S. spending on domestically-produced food. ERS uses input-output analysis to calculate the value added, or cost contributions, from 12 industry groups in the food supply chain. Annual shifts in food dollar shares between industry groups occur for a variety of reasons, ranging from the mix of foods that consumers purchase to relative input costs; implications of this year’s COVID-19-related shelter-in-place restrictions will be reflected in the 2020 food dollar. This chart is available for the years 1993 to 2018, and can be found in ERS’s Food Dollar Series data product, updated on March 23, 2020.