Farmers and low cost of food


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Posted Online: Nov. 18, 2012, 6:00 am
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By Dan Lee
When the items in the shopping cart total $100, $200 or $300 as folks are doing their shopping for Thanksgiving dinner, there will be many complaints about how expensive food is. Actually, compared to what folks in other countries pay, food is relatively inexpensive in this country, when measured as a percentage of household income.

On the average, Americans spend approximately 6 percent of their household income on food (less than ten percent when eating out is included), significantly less than any other country in the world. And if you think that our food costs, when measured as a percentage of household income, are greater today than they were in previous years, think again. Current expenditures on food compare very favorably to the 42.5 percent Americans spent on food in 1901 and the 29.7 percent in 1950.

Farmers, by the way, receive less than 20 percent of what Americans spend on food today. Processing, distribution, advertising and other costs, along with profits that accrue to processors, distributors and retailers, account for the rest. It might be added that as consumers buy more frozen meals and other prepared foods, the farmer's share of the food dollar goes down while the processing share goes up.

he low cost of food in this country today is the direct result of the incredible productivity of American farmers. In 1949, U.S. wheat yields were essentially the same as those 75 years earlier -- approximately 15 bushels per acre. But then with increased use of artificial fertilizers and herbicides, yields tripled to an average of 46 bushels per acre in 2010.

At the conclusion of the Civil War, corn yield in the United States averaged 30 bushels per acre. With some yearly variations related to weather conditions, it remained at that level for the better part of a century. Yields began increasing with the introduction of hybrid seed corn in 1933. The major increases, however, didn't occur until after World War II when farmers started using a powerful arsenal of agricultural chemicals, among them artificial fertilizers, herbicides, and pesticides. Today, the average corn yield is more than 150 bushels per acre with yields in excess of 200 bushels per acre being achieved here in Illinois and next door in Iowa by some farmers when growing conditions are ideal (which they weren't this year).

The transition to factory farms for meat and eggs has similarly contributed to our low food costs. The old family farm that produced several different crops and had chickens, hogs, cattle and other livestock is by and large a thing of the past. Livestock production has shifted from small diversified farms to large factory farms, many owned by investors who are not themselves directly involved in agriculture. These include large dairy, hog and chicken confinement operations, where the animals, instead of being allowed to wander about in open fields or large pens, are kept indoors where they are fed and watered in confined spaces, with, in many cases, their feed laced with antibiotics and other chemicals intended to prevent disease and promote growth.

The result? More meat and eggs at lower prices. In 1970, Americans spent, on average, 4.2 percent of their incomes to buy 194 pounds of red meat and poultry. By 2005, the percent of income Americans spent on red meat and poultry was just half that -- and bought 221 pounds of red meat and poultry. Today in the United States, more than 97 percent of pork comes from factory farms. Chickens in egg factories produce 95 percent of the eggs we consume.

The agricultural revolution that has brought an abundance of food at relatively low prices, however, is a mixed blessing. This abundance has come with some very serious costs, environmental and otherwise. More on that in a subsequent column.
Dan Lee, who grew up on a family farm where they raised grain, hay, cattle, hogs and chickens but made very little money, teaches ethics at Augustana College; danlee@augustana.edu.














 



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