By Julie Tomascik
Editor
Grocery prices remain high, but that doesn’t mean farmers and ranchers are making more money.
A new American Farm Bureau Federation (AFBF) analysis shows that prices consumers pay at grocery stores often move in the opposite direction of prices farmers receive for their crops and livestock.
In August 2026, the national average retail price of ground beef was 7.4% higher than a year earlier, while prices paid to cattle producers fell 10%.
Similar trends occurred with other agricultural products.
Farm prices for fresh vegetables declined 7.3% compared to August 2025, but retail prices increased 3.2%. Dairy farmers received 3.5% less for their milk, while grocery store dairy prices declined just 0.3%.
The differences reflect the many steps involved in getting food from the farm to the grocery store, according to AFBF Vice President of Communications Terri Moore.
“Although farmers are the first link in that chain, there are many other links: processing, packaging, transporting, marketing. And all of those take a piece of the pie when it comes to the food dollar,” Moore said.
USDA data show farmers received just 5.8 cents of every dollar spent on domestically produced food in 2024. The remaining 94.2 cents covered processing, transportation, retail and other costs throughout the food supply chain.
Farmers also have little control over the prices they receive.
Unlike many businesses, farmers cannot simply raise their selling prices when production expenses increase. They must accept prices established by the market, even as costs for fuel, fertilizer, equipment and other inputs continue to rise.
Farm prices also tend to fluctuate more sharply than retail prices, which often take longer to reflect changes in commodity markets.
“Farmers have to sell at whatever price the market sets because they are price-takers, not price-makers,” Moore said.
The financial strain has left many farms operating at a loss, and some are facing their fifth consecutive year in the red, according to AFBF.
Consumer perceptions
A national survey conducted in June by Global Strategy Group found nearly two-thirds of consumers identified grocery prices as a major financial concern. About two-thirds also considered food prices unfair.
When asked about the causes of higher prices, 48% pointed to tariffs and 46% blamed large corporations raising retail food prices.
“Based on some surveys that have been done, they don’t blame farmers, and they don’t think farmers are getting rich when food prices go up,” Moore said.
AFBF noted that consumer trust in farmers has remained above 80% in its polling for nearly a decade, but public understanding of agriculture remains important as farmers face continued economic challenges.
The work ahead
AFBF identified several opportunities to strengthen the farm economy, including expanding domestic demand for agricultural products, increasing biofuel production and developing new export markets.
Lowering production costs and making expenses more predictable could also help farmers manage financial risks.
AFBF also noted the need for an updated farm bill. Congress has extended the 2018 Farm Bill three times, leaving farmers operating under policies developed before many of today’s economic challenges.
Moore said addressing these issues will require several approaches rather than a single solution.
“Stabilizing those supply costs, ideally lowering them, but at a minimum, stabilizing them so they’re more predictable is important, and we really need to get that farm bill done,” she said.
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