Food Cost Review, 1985

Food prices, as measured by the Consumer Price Index, increased 2.3 percent in 1985, compared with a 3.8-percent rise in 1984. The smaller rise reflected large supplies of most commodities, particularly meats. The prices farmers received for commodities dropped sharply. The farm value of USDA's market basket of foods dropped 6.9 percent. This large decline brought the 1985 farm value of foods to nearly the same value as in 1980. In contrast, retail food prices rose 18 percent between 1980-85. The farm-value share of a dollar spent at foodstores fell to 31 percent from 34 percent in 1984. The farm-to­retail price spread of USDA's market basket of foods rose by 5.3 percent, the largest increase since 1982. Food industry marketing costs increased very little, mostly because of a small rise in wages and salaries of workers