Thursday, March 27, 2014

The Real Cost of Food

I am a news junkie; I can’t seem to get enough of the local or national news. Often I listen to it on the radio, watch it on TV, read the newspaper and look at different sites on-line. There are no two ways about it; I am addicted to the news. This is an odd addiction because often what I hear, read and see on the news makes me upset and that very thing happened this week.
Just about every news outlet I tuned into had a story about the rising cost of food. It seems due to drought, the cost of food is projected to rise by 3.5%. Now like many of you, I do not have any extra money to spend so any increase in my cost of living is unwelcome. However, one thing I was unhappy about was that this increase was not put into perspective.
As Americans we spend less of our annual income on food than anywhere else in the world. I found a publication from Washington State University stating that we spend only 6.8% of our annual income on food. Compare that with other countries such as the Ukraine (they have been in the news here lately); Ukrainians spend over 40% of their annual income on food. I don’t know exactly what 3.5% of 6.8% is but I know it isn’t much.
It seems funny to me that fuel cost can go up 10 to 20 % easily in a couple of months, yet we rarely see any news outlet report on that. I would guess that most of my monthly utility bills have all increased by over 3.5% in the past year. Was the increase unwarranted or excessive? I am not sure but the point is that there does not seem to be any reporting over these price increases. Why is that?
Well, for one thing we have done such a good job of producing the most affordable, reliable and wholesome food supply that we have spoiled our consumers. Think about it we are used to walking into just about any grocery store and making a choice between anyone of a dozen different choices for any grocery item. Choices like conventional or organic, name brand or store brand, you name it we have a choice. Often the price differential is not even that great, we are way too used to have affordable, abundant food at our finger tips.
Here is a news flash, even with a 3.5% increase in food costs; we still have the most affordable food supply anywhere in the world. Don’t get me wrong, I am concerned. I recognize that there are many who struggle to pay for their food and we must pay attention to them. Most of us can easily absorb a 3.5% increase even if it means one less movie night each year, but for those who can’t we should provide them some help.
I also fear that supply problems and the corresponding price increases caused by droughts will cause some damage to our demand for our products. First and foremost would be the commodity nearest and dearest to my heart, beef. Because of our historically low cow numbers and short supply of beef, the cost of beef in the grocery store is climbing and I fear that in the long term it will scare consumers away. This will not be because the majority cannot afford beef; it will be because there are more affordable options.
While it is frustrating that a small increase in the price of food can bring headlines in the news, I can see some positive in all of this. First, it does focus the general public on how important our food supply is. I think many of us do not fully realize this because we have never been faced with a shortage of food. The general public just assumes that the grocery store shelves will be full and the prices will be low. The production of food is one of the most important and the most overlooked part of our national security.
Finally, it gives those of us in agriculture the opportunity to educate our consumers about what we do and why it matter to them. I would bet that most of us are far more aware of the importance of irrigation waters in California than we were just a couple of months ago. It should help with the decisions in times of drought between green lawns, swimming pools and crops. We need to have an educated consumer because whether we know it or not we are all big fans of the safe, abundant and affordable food supply this great nation produces.

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