WASHINGTON, June 26, 2017 – Right on time for Fourth of July celebrations, a pair of reports show a drop in food costs for U.S. consumers.
On Monday, the American Farm Bureau Federation (AFBF) announced findings showing the cost of a summer cookout for ten people dropped slightly from $56.06 in 2016 to $55.70 this year.
The fifth annual AFBF summer survey evaluates the cost of 14 popular food items at a cookout. The price drop is consistent with the USDA’s Economic Research Service May 2017 findings, which notably point out that grocery prices haven’t seen a price drop in almost 50 years.
AFBF Director of Market Intelligence John Newton said “higher production has pushed retail meat prices down.” More competition in the meat case can help explain the almost one percent drop in price from last year’s AFBF survey results.
While a lower cookout cost is good news, the share of the average food dollar going to farmers and ranchers continues to decrease. Of the $55.70, farmers and ranchers only receive about $8.74, or about 15.5 percent of the total cookout bill. Last year, that figure was closer to 17 percent.
“Through the mid-1970s, farmers received about one-third of consumer retail food expenditures for food eaten at home and away from home, on average,” Newton said. “That figure has decreased steadily and is now about 16 percent, according to the Agriculture Department’s revised Food Dollar Series.”
While ERS noted prices at the grocery store saw their first decline since 1967, restaurant prices increased 2.6 percent. ERS pegged the increase on “differences in the cost structure of restaurants versus supermarkets or grocery stores,” specifically labor and rental costs.
To collect data for this year’s informal survey, 97 Farm Bureau members recorded retail prices across 25 states. The cookout menu includes hot dogs, ground beef, buns, pork spare ribs, deli potato salad, baked beans, corn chips, lemonade, chocolate milk, cheese, ketchup, mustard and watermelon.
American cheese, pork spare ribs and chocolate milk saw an 8, 4 and 2 percent decrease, respectively, in price over the last year. Menu items increasing in price were hot dogs, corn chips and watermelon.