Blog | August 4, 2008

Hilde stumps you with a riddle (a guise, really, for talking about ag-stats)

What do a six-pack of beer, a box of cereal, and a bag of potato chips have in common?

(For those of you who are thinking “Mmm…dinner!” – I’m glad you’re reading this blog – we have much to teach you!)

Before I give the answer away, let’s talk a bit about food systems and farmers’ share of the retail dollar (hint, hint).

The simple food chain of days past, in which a farmer grows food and sells that food directly to the consumer, is cropping up again all over the nation. Farmers market and Community Supported Agriculture (CSA) growth is at an all time high, and more and more people (farmers and consumers alike) are getting involved in direct markets. As a result, farmers are able to capture a greater share of the food dollar and consumers are able to avoid many of the processing, distribution and marketing costs typically tacked on to the price of supermarket goods.

The majority of our food, however, has a much more storied path from farm to table – getting all the more complicated every day. Think of a pin-ball machine, the ball bouncing from lever to lever, working its way through chutes and channels, up and down, even side to side, depending on the whims (and luck) of whomever’s at the helm. Our food, oddly enough, often takes a similar path, being passed from player to player in an effort to both add value (via processing, packaging and other marketing strategies) and to keep up with the erratic trends and demands of an increasingly global food system. Through each hand our food passes, a chunk of the food dollar is snatched, and the gap between what we pay at the checkout stand and what ends up in our family farmers’ pockets is widened.

Thanks to the number crunchers at National Farmers Union (NFU), we now have some current stats to give us a better idea of the farmers’ share of our grocery bill. NFU analyzed a select market basket of goods, ranging from carrots to cheddar cheese to top sirloin steak. Now back to the riddle…) Turns out a six-pack of beer, box of cereal and bag of potato chips all contribute very little to the farmers’ bottom-line – about two cents of the food dollar. In other words, when we’re purchasing these products we aren’t really paying for the food so much as the transport and processing and packaging and wholesaling and retailing… (and…and…)

Fortunately for our family farmers, the products I chose to highlight aren’t representative of the average cut, which, according to NFU, is around 20%. Yet, if we look at historical data, we find that the farmers’ share of the food dollar has been slipping for years. According to Bruce Gardner, author of American Agriculture in the Twentieth Century: How it Flourished and What it Cost, farmer share fluctuated around a mean of 40 percent between World War I and 1970, but has declined ever since to its current state.

Furthermore, this 20% average isn’t referring to farmer profit, per se, but what the farmer gets and then must use to repay farm expenses (expenses which have almost doubled since 2002).

So, what can you do to ensure that more of your food dollar is actually paying for food and making its way back to the family farmer?

  1. Go straight to the source! Through farmers markets, roadside stands, CSAs and even internet-sales, look for increasingly available opportunities to shorten the food chain and buy direct.
  2. Support domestic fair trade. Groups like Equal Exchange are well on their way in developing a domestic version of the international fair trade program that guarantees fair prices and a living wage for farmers.
  3. Look for local food in restaurants and supermarkets. In general, the farmers’ share of food purchased in restaurants is less than if you were to buy the same food from a supermarket and cook it yourself (and, as I’ve just noted, the farmers’ share of many supermarket goods can be quite small). But if you are buying or making meals made from locally sourced food, sold directly to the restaurant or grocer by family farmers, you can cut a number of links from the food chain and, in turn, ensure more of your money is making it back to the local farm economy.
  4. And, finally, buy fresh, unprocessed, unpackaged goods. Not only do these foods have fewer additives and packaging, making them a healthier choice for you and the environment, they have less added distribution and marketing costs, saving more of your food dollar for the farmer and your own personal pocketbook.

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