FARMERS’ SHARE OF MONEY SPENT ON FOOD IN AUSTRIA

Abstract

There has been renewed interest in the farmer’s share of retail food sales recently,
in the wake of sharp fluctuations in farm-gate or retail prices. Statistics on farmers’
shares were already being developed decades ago and recent updates are a response
to these fluctuations. We define the farm share as the average portion from each
monetary unit spent on food by consumers that is received by farmers for their
agricultural commodities. The same calculation gives the marketing margin, which
is the remainder. Calculations show that the farmer's share from retail food sales
has been on the decline for more than 60 years. Therefore, the gap between
farmers’ share and marketing margin is widening. This paper presents (i) the
development of the farmers’ share for Austria mainly for the period 1995 to 2013
and, where data is available, from 1971 onwards and(ii) compares the results with
the developments in Germany and the United States as well as Switzerland. For
Austria, two calculation methods are shown: the Agristat method (developed in
Switzerland) and the method of the Austrian Institute of Economic Research
(WIFO). Both calculations are based on official statistical data (Economic
Accounts for Agriculture, National Accounts and trade data) but use different
approaches. This paper uses the findings of these calculations to hypothesize on
necessary areas for future research.