Farmers’ Share of Food Dollar Increasing, Albeit Slowly

WASHINGTON, DC – On average, U.S. farmers received 14.6 cents for farm commodity sales from every dollar spent domestically, in 2018, on food. According to USDA’s Economic Research Service (ERS), the farmers’ share is up slightly from 14.4 cents in 2017. Known as the farm share, this amount increased for the first time since 2011 and coincides with a flattening in average prices received by U.S. farmers after steep declines in 2015 and 2016. ERS uses input-output analysis to calculate the farm and marketing shares from a typical food dollar, including food purchased both at grocery stores and at restaurants and other eating-out places. The marketing share covers the costs of getting domestically produced food from farm to point of purchase, including costs related to packaging, transporting, processing, and selling to consumers at grocery stores and eating-out places. The relatively low farm share measures for 2015-2018 occurred during a 7-year trend of increases in the portion of the food dollar going to the foodservice industry. Farmers receive a smaller share from eating-out dollars because of the added costs for preparing and serving meals at eating-out places, so more food-away-from-home spending also drives down the farm share.