Less than quarter of food spend reaches Aussie farmers

Farmers receive just 27pc of money spent on food globally

Life & Style
COSTS DIVIDED: The share of food spend that reaches farmers pockets has dropped as populations have become more urbanised and distant from where food is produced. Photo: SHUTTERSTOCK

COSTS DIVIDED: The share of food spend that reaches farmers pockets has dropped as populations have become more urbanised and distant from where food is produced. Photo: SHUTTERSTOCK

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JUST over one-quarter of consumer spending on food makes it farmers, according to international research, with the share even smaller in Australia.

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JUST over one-quarter of consumer spending on food makes it farmers, according to international research, with the share even smaller in Australia.

A paper published in journal Nature Food today shows 27 per cent of the global consumer expenditure reached farmers, while this number shrank to just 23pc for Australian farmers.

The largest share ends up in the post-farmgate value chain.

The reseachers looked at 61 middle - and high-income countries, which cover about 90pc of the global food economy, during an 11-year period from 2005-15.

The figure consistently falls in the 16-38pc range for middle- and high-income countries and falls significantly as incomes rise.

The researchers, from United States-based Cornell University, the US Department of Agriculture and the University of Copenhagen, Denmark, say part of the reason why this area has been under-researched is the difficulty in finding comparable data across different nations.

The US has economy-wide food value chain data, with the USDA publishing a "food dollar series' each year since 1947, which has been used to examine competitiveness and performance of these value chains, but the researchers say Canada is the only other country with a comparable series constructed, covering the 1997-2010 period.

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Building on this method, Christopher Barrett and colleagues developed a universal, standardised approach to estimate the importance of food value chains between farmers and consumers, known as the 'global food dollar' method.

Using the US data, the researchers were able to show that the farm share of consumer total food expenditure has dropped from 46pc in 1947-2017 to 15pc, even as incomes grew by about 2pc a year, the population urbanised and agricultural land productivity increased by an average of more than 1pc annually.

With such a heavy role played by the post-harvest food value chain - including processing, storage, transport, wholesaling, retailing and food service - it shows how difficult it can be to get food to consumers.

"The COVID-19 pandemic has also revealed how food value chain logistical constraints can lead to the painful juxtaposition of farmers dumping unsellable milk and perishable produce at the same time as food shops run out of stock and ration purchases of increasingly expensive perishables such as eggs," the researchers wrote.

Researchers hope these findings may help inform public policies aimed at a more equitable distribution of food revenues.

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