Of every dollar you spend on food, just 11.6 cents goes to the farm and ag industry, according to the latest Food Dollar report from the U.S. Department of Agriculture. The percentage of the food dollar that goes to farmers has declined almost every year since the USDA starting keep this data set in 1993.
So who is getting a bigger chunk of the money? Well, in recent decades Americans are eating out more — and this means an increasing percentage goes toward restaurants (what the report calls food services). When we go out to eat, we’re paying for the wait service, having that food prepared for us and for all the processing that goes into that food before it gets to the restaurant.
If we look instead at dollars spent mostly in grocery stores (food-at-home dollar), 18.3 percent of that spending goes to farmers and agribusiness. And, this percentage has remained fairly steady over the past few decades.
Our habit of dining out — as well as buying more processed foods at the grocery store — is also behind an increase in energy use in the food system.
“Research showed that in fact the largest growth in energy use was attributed to food processors,” said Food Dollar Series author Pat Canning of the USDA. “And what specifically explained that is that both you and I as households and these restaurants that are serving us food — we’re outsourcing the preparation of our food to processors. And they’re not hiring food prep workers; they’re using more mechanized processing machinery.”
So as we replace jobs that people used to do with machines, we’re using greater amounts of energy, largely in the form of oil and electricity.
Food processing and food services combined account for more than half of our food spending. Compared to all this, transportation and packaging receive a relatively small percent of the food dollar than farmers (3.5 cents and 4 cents, respectively). And here’s a somewhat surprising note: Only a small fraction (2 percent on average) of our food dollar goes toward advertising.
Wanna learn more? Check out the Food Dollar application for yourself. You can change the settings at the top to see where your food dollar goes in different years, and depending on where you spend it.