USDA Report Says Food Dollars not Going to Food


March, 2011

USDA Report: Less Than 16% of Your Grocery Money Goes to Food Itself

Oh, I know I have been passionate with my emotions regarding the lack of proper labeling on my food products and how seems to me that the FDA doesn’t want to take a hint (still) from several other countries in this world who feel it is necessary to actually caution consumers about the food products they buy.

That sentence was a mouthful. But I am passionate. Now, I am irate about the new information out there about how a USDA report is switching up the way it explains expenditures on the food system each year (more on this in a minute). The fact that (are you sitting down?) less than 16% of your food budget is actually spent on the actual food you buy. I thought 19% was atrocious back in 2006.

Why on Earth is this happening you say? Apparently we love processed foods, and they cost a lot to process. Then there is our inherent need to have pretty looking packages. We are now paying even more for those precious little graphics adorning our food products and that heavy plastic, Styrofoam, or cardboard container they often come in. At this rate we will be looking at around 13% in 2016. Yes, as if it isn’t a big enough insult to take advantage of consumers by somehow making them fall in love with the package, forgetting that the food inside that package is well, less than desirable. Now we know that for each buck we spend at the grocer, less than 16 cents actually goes towards the edible part! Yup, that’s 84 cents worth of marketing, packaging and processing for each hard earned dollar you cough up at the Piggly Wiggly, America! For that, the package of frozen veggies better walk itself into the house and jump into the freezer right out of the car all by itself! I mean, I don’t recall my ice cream ever having a gold rimmed container processed God knows where to warrant 84% BS!

If this news doesn’t make you want to recycle more, and question processing, what will? While it’s not ALL about recycling, that is a HUGE part of it. If these grocers could buy inexpensively packed product from recycled materials, maybe we could get the 84% down a bit... no? Why are people still throwing away the plastic, (don’t even get me starting on Styrofoam), and cardboard containers? What is it going to take for consumers to demand change? There are a record amount of people in this country already on some sort of government food supplemental income program. People are already struggling to keep the cupboards full. If all of these same people knew that a mere 16 cents for each food dollar they budget went to the part of the package they could actually eat, who knows?

Now, I understand that this is an average, and that we all don’t fall for the bells and whistles of packaging, and the need to eat over processed foods (each step in the process in production costs money). Many of us opt for the nameless brand when we can, but 16% just does not seem to compute. This begs the question, what is going on with processing and why is it costing more and more every year?

So, back to the USDA.  Mixing up their reports on expenses and how they are conveyed to consumers, the USDA has released the Economic Research Service’s new report on the food dollar (and just how far it doesn’t go). As the report states, it is intended to answer the question - For what do our food dollars pay?

This is where it gets interesting. The USDA has become ever so clever in the way it is relaying these findings to us, the consumer.  The language in the USDA report is offsetting and vague. More so than ever, it changed due to the need to keep us in the dark apparently. The USDA report bases its findings on what happens between the farm (origin) and marketing (how it looks when you buy it from the store). Think of a pie chart. This chart shows 16% going to the farmer and the marketing share is the massive 84% of that pie chart. So, what the heck is happening to the food between the time it leaves the farm to the time it hits the shelf? Is it flying first class on a private plane?

Back to that comment I made a few paragraphs back. Why have we lost an additional 3% in the past 5 years?  In the day and age where I thought more consumers were starting to open their eyes and consider the damage packaging, processing, and marketing was causing to the amount of food in their fridge.

Well, the USDA altered the methods for computing this report. It breaks the expenditures down to vague supply chain categories such as Processing (accountable for nearly 12% of expenditure) and Food Service (accountable for almost 34% of expenditures). That’s 34 cents for each dollar spent). From the report, these are the two categories that are eating most of the pie (chart).  How vague are these categories? VAGUE! Oh yeah, then you have the category Other. That's where nearly 4 cents of each of your dollars is going. Maybe this is the category where the expenditure to create a vague report comes from.

For what do our food dollars pay? I still don’t know. Thanks to vague reports. But I am pretty sure we need to look at food service expenses and processing. Whatever they are.

Tip: Head to your local farmer’s market and get better tasting food that costs less and supports your local economy (because it wasn’t flown first class to get to you, but it was produced with love!) PS, many larger farmer style markets and co-ops are now accepting government assisted food money programs as a form of payment.


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