(The highlights statement referred to follows:)

STATEMENT ON DEVELOPMENTS IN MARKETING SPREADS FOR AGRICULTURAL PRODUCTS IN 1963

1. The spread between farm and retail prices of food products in the market basket of farm foods continued to widen in 1963.1 The increase of 4 percent last year was the largest since 1958 and double the average annual increase in 195362 (table 1 and fig. 1).

2. Retail prices of farm-originated food products averaged only 1 percent higher in 1963 than in 1962. Thus, the larger part of the increase in the farmretail spread in 1963 resulted in lower prices to farmers.

3. Farmers received an average of 37 cents of each dollar consumers spent for farm-originated food products in retail stores last year, 1 cent less than in 1962. This was the smallest farmer's share since 1934, when it was 34 cents (fig. 2).

TABLE 1.-The farm food market basket: Retail cost, farm value, farm-retail spread and farmer's share of retail cost, 1953-63 1

1 The farmer's share and index numbers of the retail cost, farm value, and farm-retail spread for the years 1913-61 (1957-59-100) are published in the February 1962 Marketing and Transportation Situation (MTS

144) p. 50.

2 Retail cost of average quantities purchased per family in 1952 by urban wage earner and clerical worker families, calculated from retail prices collected by the Bureau of Labor Statistics.

3 Payment to farmers for equivalent quantities of farm produce minus imputed value of byproducts obtained in processing.

4 Preliminary estimates.

NOTE.-Current data are given in the Marketing and Transportation Situation, a quarterly publication of the Economic Research Service, and in the Statistical Summary, a monthly publication of the Statistical

Reporting Service.}

1 The market basket contains the average quantities of farm-originated foods purchased per family in 1952 by urban wage earners and clerical worker families. The farm-retail spread is the difference between the retail cost of these foods and the farm value or return to farmers for farm products equivalent to the foods in the market basket.

RETAIL COST, FARM VALUE, AND
MARKETING SPREAD FOR FARM FOODS

DATA ARE FOR MARKET BASKET OF FARM FOODS CONTAINING AVERAGE 1952 PURCHASES BY URBAN FAMILIES. 1963 PRELIMINARY.

FARMER'S SHARE OF DOLLAR SPENT FOR FARM-ORIGINATED FOODS IN RETAIL FOOD STORES.

U. S. DEPARTMENT OF AGRICULTURE

1965

4. Beef, processed orange products, and bread accounted for about threefourths of the increase in the market basket farm-retail spread in 1963, although the spread for many other products also widened (tables 2 and 3). Much of the increase in the market basket spread came in the first quarter, when prices farmers received for beef cattle dropped much more than retail prices of beef.

1 The methods of calculation and the sources of price data are given in pt. II of "Farm-
Retail Spreads for Food Products," U.S. Department of Agriculture Miscellaneous

Publication 741, 1957.

2 Product groups include more items than those listed in this table. For example, the meat products group includes veal and lower grades of beef in addition to carcass beef of Choice grade, lamb, and pork.

3 This estimate of the farmer's share does no allow for Government payments to producers.

Farm produce equivalent to products bought by urban families.

Average quantities purchased per urban wage earner and clerical worker family in
Farm value of cream and milk only.

1952.

"Net farm value adjusted for Government payments to producer was 25.6 cents, farm-
retail spread adjusted for Government processor tax was 34.5 cents, and farmer's share of
retail cost based on adjusted farm value was 44 percent.