CIAS Meal Ticket #2

Your consumer food dollar: How does it carve up?

Everyone wants to save money on food.  Finding the best balance of affordability, convenience, taste and nutrition is complex… and it can be a challenge.

As you budget your food dollars, have you ever wondered exactly where they go?  You probably have a good idea of how much you spend on milk, or meat or vegetables, or treats in a given month.

Did you ever think about what portion of your average food dollar goes to the food itself?

Look at what a dollar really buys

Farmers produce everyone’s food.  Yet farmers’ share of the consumer food dollar is small.  The USDA reports that, in 1997, farmers received, on average, only 21 cents of each consumer food dollar.

The remaining 79 cents of each dollar you spend on food goes to marketing-related activities, including packaging, advertising, transportation, and the labor used by assemblers, manufacturers, wholesalers, retailers, and eating places.  This includes the times you choose to eat out.

The non-farm labor portion of your dollar in 1997 amounted to 38.5 cents—66percent more than in 1987.  That means you paid nearly twice as much for marketing-related labor alone than farmers received for all farmstead activity combined.

Think about the whole pie

If you spend $100 on food, is the marketing-related food activity worth $79 to you?

Would you consider changing your food buying habits if you could see that farmers received part of the $79 for safe, nutritious, delicious food, and you pocketed the remainder that would otherwise go to marketing-related activity?

Farmers are receiving an ever-decreasing share of the consumer food dollar.  Many farmers are also receiving lower prices for the commodities they grow or produce now than in past decades.  Their incomes are not keeping pace with the low rates of inflation that the U.S. economy has experienced in recent years.

At the same time, farmers are citizens, consumers and businesspeople.  Like all of us, they must spend more each year on basic services. Like medical care, transportation, housing, and apparel…as well as on business-related costs like land taxes, farm inputs, and equipment.

Since most farmers receive prices for their food that they don’t set, they’re subject to big changes in income, beyond their control.  For example, diary farmers in Wisconsin saw the price of milk plummet overnight from about $16 per hundredweight to just  over $11 in early 1999—a 30 percent wage cut with no warning, no explanation and no means to respond to it.

The solution offered to farmers has generally been to quit…or to get bigger, farm more land more intensively, and produce more.  In theory, this holds the price of food down by making food production “more efficient”—consolidating it into the hands of the few, large, corporate farms.  This has happened with the pork and poultry industries.

So what’s so bad about cheap food?  Isn’t it true that the U.S. food prices are the lowest on the planet?  Yes.

But many of the costs of keeping food prices low are hidden.  For instance, economic and social costs are hard to put a dollar value on.  What’s the cost of the loss of a long time family farm business?  Or the knowledge base of a farm family or rural community?  What’s the cost to you having fewer and fewer choices about who to buy your food from…and more and more consolidation in who controls the food supply?  What is the environmental and social cost of large, corporate farms?

Efficiency measured only in dollar terms can lose these realities.

Cut the pie differently

How you spend your food dollar can make big changes.

Each time you buy food you can help build the market for food whose added value is nutritional, social and economic.  You can support farmers who are trying to get control of their lives and work.  And you can support social and economic justice.

Ask your grocers to buy directly from local farmers in season.

Look for options like community-supported agriculture (CSA).  This is where consumers become members of and direct investors in a CSA farm, and purchase “shares” of what the farm produces.  CSA members pay at the beginning of the season for their share, giving farmers the capital they need to produce food and sharing the risks with consumers.

Remember that small adjustments in your food buying habits can have a big impact.  If every consumer shifted one or two cents per dollar away from the food marketing sector and toward farmers, the impact would be huge.

Encourage food retailers, wholesalers, or dining services to buy directly from farmers.  Hospitals, workplaces, schools, and universities often have food services.  Let dining hall managers know you want locally, sustainably produced foods.

Shop at farmer’s markets.  They’re a great way to support farmers, to spend more of your food dollar on food, and to have fun with your friends and family.  The same is truw with supporting other farmstead enterprises, like u-pick operations.

Build family and friendship adventures around food.  Why not extend that beyond the dining table…to the very places and ways you acquire your food?  Teach your friends and family to become the adventurous, wise hunter-gatherers of the new millennium, rather than poorly nourished, fad-chasing, unthinking consumers of the twentieth century.  Instead of going to the same old burger joint or shopping mall pizza mill for the thousandth time, research a farm or a farmer’s market visit.  Join a CSA and get together with other members for a potluck or theme meal.

Say thank you to workers in the food service industry each time they serve you.  Remember that many of them come from families that are only a few generations removed from farms and farming.

UW-Madison Center for Integrated Agricultural Systems
© 1999 UW Board of Regents