Developments in Marketing Spreads for Agricultural Products In 1961

Report Highlights: The spread between retail and farm prices of food products reached a new high in 1961. The increase of 1.6 percent from 1960 was greater than in the 2 preceding years but below the average annual increase of 2.8 percent since 1950. The farmer's share of the retail food dollar averaged 38 cents in 1961, the same as in 1959. This was the lowest annual average since the early 1930's. The increase in marketing spreads in 1961 was again reflected in slightly higher food prices at retail for the year as a whole. However, in the last 10 years consumer prices for food have risen substantially less than most other goods and services bought by consumers. Food prices have risen less than other things primarily because prices received' by farmers for food products have declined. Hourly earnings of food marketing employees, the major cost item in marketing food, increased by 4 percent from 1960 to 1961. But gains in labor productivity in processing and distributing food kept unit labor costs from rising appreciably. Total profits of the major food processing and distributing firms continue to increase, primarily because of greater volume. However, profits as a percentage of sales have trended upward moderately since the early 1950's.