WASHINGTON—As consumers pay more at grocery store checkouts and restaurants, farmers receive a smaller share of every food dollar, according to a report from the American Farm Bureau Federation.

The organization’s Market Intel analysis found farmers and ranchers received just 5.8 cents of every dollar spent on food in 2024, down from 5.9 cents the previous year. The figure reflects the farmer’s share after accounting for production expenses.

Crop producers had their portion decline from 2.9 to 2.5 cents, while livestock producers saw a slight increase from 3 to 3.3 cents. The increase among livestock producers can be attributed to shrinking herds, which boosts cattle value. Meanwhile, crop farmers continue facing historically low crop prices alongside increasing expenses for inputs like fuel and fertilizer.

The findings highlight the growing financial pressures many farmers face, even as food prices remain elevated for consumers.

“America’s farmers and ranchers are the backbone of our country’s food system, yet they only see a small share of the total food dollar,” said AFBF President Zippy Duvall. “While prices may be up at the grocery store, most farmers’ paychecks are shrinking. Even modest swings in commodity prices or increases in expenses can quickly strain farmers’ finances to the breaking point. This imbalance must be corrected to create a brighter future for U.S. agriculture. The only alternative is reliance on other countries to feed America’s families.”

AFBF’s report is based on data from the USDA Economic Research Service Food Dollar Series, which tracks how each dollar spent by consumers is distributed throughout the supply chain. While farmers produce raw commodities, much of the food dollar goes beyond the farm gate toward food processing, transportation, packaging, wholesaling, retailing and food service costs.

“The shrinking farmers’ share of the food dollar is a sobering reminder of how farmers must continually improve production efficiency or look at alternatives to remain financially viable,” said Tony Banks, senior assistant director of the Virginia Farm Bureau Federation Agriculture, Development & Innovation Department.

Banks explained that as Virginia farmers face tighter commodity margins, many small and midsize operations are exploring ways to capture a greater share of the food dollar. Many have begun marketing value-added products like prepared ready-to-eat foods and selling directly to consumers to generate additional income.

“While these alternatives can be helpful, they’re not without added costs and not every farmer is going to have the capacity or access to these options,” Banks noted.

The USDA Food Dollar data also showed that farmers’ share of consumer food spending varies by types of food purchased. Products with minimal processing like fresh eggs, beef, fresh milk, pork, poultry and fish return a larger portion to farmers, while significantly processed foods like bakery products and snack foods return much less.

Media: Contact Banks at 804-290-1114.