Taking a look at your grocery bill at the end of a weekly grocery trip is likely to prove one point: the price of food is on the rise. Many Americans firmly believe that someone is benefiting from these increased food prices. Almost everyone assumes that the farmers are the ones reaping the profits from soaring prices. In truth, America’s farmers have seen the very little increase in their profits in spite of the record prices of food throughout the country.
There is some indication that the rising price of food products is directly related to the rising cost of labor. Recent years have seen our economy suffer through one of the worst recessions in history, several increases the minimum wage and several other factors that have had a direct impact on the price of labor. This increase is reflected in the price of food.
The story doesn’t end there instead there are several other factors that play a role in the rising cost. Food commodities and feed prices have been steadily rising for the past few years. This is having a direct impact on the cost of producing agricultural products in United States. It follows that the increased costs will be passed along to the consumer.
At the end of the day, it costs America’s farmers more money today to produce food products than it did even just a few years ago. This price increase means that in spite of the rising costs to consumers American farmers are not seeing an increase in their profit rate.
Maybe we should consider the high cost of food as a function of the recession and the economy. It seems like our farmers are suffering too.