Rising Food Prices Haven’t Trickled Down to the Farmer

The USDA’s Economic Research Service says the Consumer Price Index for all food rose one percent from January to February. Food prices in February were 7.9 percent higher than in February 2021. Scott Brown, an associate extension professor of agricultural and applied economics at the University of Missouri, says while food prices have gone up, farmers aren’t getting an increasing share of the food dollar.

“When you think about that retail consumer dollar, only about 20 percent of it or less gets back to the farm level, and some may see that as a negative. I sometimes say we're adding a lot of value to farm-level products once they leave the farm, and so that's where this remaining 80 percent of the value-added is related to labor costs, to energy prices, all of that's been at least important in terms of the overall CPI growth that we're seeing today. So, I think to remind everyone that it's not just the farm level that's the reason why we're seeing this high CPI for food, the numbers that we're seeing today, it's all of the other costs that are probably much more important to where we sit.”

Brown says rising prices aren’t slowing down consumer demand.

“I will say, it's amazing how strong demand has been in the face of higher prices. So, we haven't seen consumers turn away yet.”