How Much Consumers Spend On Food

Consumers spent less money, on average, for the third consecutive year in 2010 according to the Food Institute's latest Demographics of Food spending report.

Consumers spent less money, on average, for the third consecutive year in 2010 according to the Food Institute's latest Demographics of Food spending report. Annual expenditures for the year averaged $48,109 per household, a decrease of about two percent from 2009. Total food expenditures in 2010 totaled $6,129, $243 fewer than in 2009. Dollars going to food away-from-home purchases also dropped for the third year in a row, a decline of 0.2%, though it was not as significant as the 0.8% drop from 2008 to 2009.

Over the decade, average expenditures increased every year from 2001 and 2008, with the largest jumps from 2004 through 2006, and then fell after reaching a high of $50,486 in 2008. Households spent less of their annual expenditures on food in 2010 than in 2009, at 12.7% compared to the previous year’s 13%. The decrease in food-at-home expenditures should not be considered as purely indicative of spending trends or decisions made by consumers in retail venues, as decreases in the consumer price index should also be taken into account when comparing annual totals.

Comparing food at-home spending to food away-from-home spending, the numbers correspond almost exactly. The 0.2% decrease in food away-from-home spending corresponds with the 0.2% increase in food at-home expenditures between 2010 and 2009. The share differences also continued the same three-year trend along with average declining spending, as food at-home spending rose for the third straight year as away-from-home spending declined. Much has been written about the “new normal” and the average consumer’s proclivity to reduce dining out and increase at-home eating or “brown-bagging” their lunch at their job. Overall, consumers are spending less on food than they had in the years before 2008, whether at-home or away-from-home.

?Most spending (35.3%) went toward other food at-home, followed by expenditures on Meats, Poultry, Fish and Eggs (21.6%). The average consumer spent 27.7% of their total Meats, Poultry, Fish and Eggs budget on beef for the year; in 2009 that percentage was 26.9%, despite the average CPI increase of 2.8% for beef and veal in 2010. Regarding pork, households spent 19% of their meat budget on swine, compared with 20% in 2009. The CPI increase of 4.7% over the previous year suggests that consumers purchased significantly fewer pork products than they had in 2009. Interestingly, consumers also seemingly reduced their poultry purchases in 2010, allocating 17.6% of total meats, poultry, fish and eggs expenditures on poultry, compared with 18.3% in 2009. The consumer price index over the same period remained nearly at the same level, declining 0.1% for all poultry and 0.6% on chicken specifically.

In other food-at-home purchases, consumers spent more dollars on fruits and vegetables, an average increase of $23 per household, with increases in every subcategory except for processed fruits. The 2010 CPI for fruits and vegetables remained stable, increasing 0.2%, while the share of total food-at-home expenditures put toward fruit and vegetable purchases increased 0.5% year-over-year. In 2010, the CPI for fresh fruits decreased 0.6%, increased 2.3% for fresh vegetables and declined 1.3% for processed fruits and vegetables.

The average household also spent less on Cereals and Bakery Products and Dairy Products, at $4 and $26, respectively. As a share of the total food-at-home budget, the average consumer household spent 0.4% more on cereals and bakery goods but 0.3% less on dairy products, but spent approximately the same on fresh milk and cream despite a 3.3% increase in the CPI for fluid milk. In the Other Food At-Home category, consumers spent $4 less, but approximately 0.2% more on nonalcoholic beverages, the same on “miscellaneous food,” and $9 less on sugar and other sweets compared with 2009.

For more on this just released study, go to http://www.foodinstitute.com/demographics.cfm.