Farmers’ Share of the Food Dollar is Still Low

 

A Farm Journal report says some consumers may still look at grocery store prices and think farmers are making a lot of money off the commodities they produce. A U.S. Department of Agriculture report says for every dollar that consumers spend on food, farmers and ranchers get approximately 17.4 cents. The remaining 82.6 cents of every dollar goes to things like marketing, processing, wholesaling, transportation, and retailing. For example, for every pound of bacon purchased, the consumer spends $5.63 while the farmer earns 75 cents. Consumers will spend $3.99 for a pound of tomatoes and the farmer earns 29 cents. For every pound of lettuce consumers buy, they’ll spend $2.79 while the farmer earns a nickel. Lastly, an 18-ounce box of cereal will cost consumers $4.79 but the farmer will only earn a nickel. Compared to the retail price of most products, farmers will often only make pennies on the dollar. The food dollar series for the USDA’s Economic Research Service measures annual spending by consumers on domestically produced food.  

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