Health, Nutrition and the U.S. Food Chain: Trends and New

Findings

OECD Food Chain Analysis NetworkMobilizing the Food Chain for Health

Oct 25-26, 2012

Jay Variyam, Branch ChiefFood Economics Division

Economic Research ServiceU.S. Department of Agriculture

Disclaimer: The views expressed here are those of the author and do not represent the views of the ERS or the USDA

Consumers spend 10% on food

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Share of Personal Disposable Income

Share of Personal Disposable Income

Where that 10% went…

Innovation: Convenience

Variety and choice

Number of items carried by U.S. supermarkets

Consumers want …

• Taste• Low price• Convenience• Safety• Quality• Nutrition• Variety• Eco/Green

Overarching trends

I. Changing channels of food distribution

II. Differentiation

III. New products to meet changing consumer demand

I. Nontraditional Retailers Entry into the Retail Food Market

I. Expenditure Shares for Nontraditional Retailers Continue to Rise

Source: ERS Calculations using Nielsen Homescan Data

I. Wal-Mart Supercenters

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Wal-Mart Supercenters

II. Retail differentiation

Retailers are also differentiating with expanded productofferings

• Private label

• Prepared foods

• Fuel

• Organic foods

Organic Food Sales

III. Meeting consumer demand

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New product introductions of consumer packaged goods, 1992 to 2010

Food and beverageNonfood

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III. Meeting consumer demand

New product introductions

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Low or no carbLow or no trans fat

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Recent Findings

• Affordability of Healthy Foods• Access to Healthy Foods• Healthfulness of Purchases and

Consumption• Response to Information/Labeling

New Results: Affordability

• Are healthy foods more expensive?– Yes, if measured on per calorie basis– No, if measured on the basis of edible weight

or average portion size– In terms of the cost of meeting dietary

recommendations, it is less expensive to meet the grains, dairy, and fruits recommendations than the vegetables or protein grp recommen.

– http://www.ers.usda.gov/publications/eib-economic-information-bulletin/eib96.aspx

Affordability

• Can low-income Americans afford meeting fruit and vegetables guidelines?– Stewart et al., Jrl of Nutrition Education &

Behavior, 2012 Best Article– Costs per cup-equivalent of fruits and

vegetables, including whole and cut fruit, fruit juice, dark green vegetables, orange vegetables, legumes, and others

Affordability

• In 2008, a variety of fruits and vegetables was available for an average cost of $0.40 to $0.50 per cup-equivalent

• Low-income Americans facing national average prices can satisfy fruit and vegetable guidelines with a standard budget

Access

• Hypothesized relationship between access to affordable & nutritious food and diet quality and obesity

• ERS “Food Deserts” project, 2009• Major update based on new data to be

released: Report in November and on-line map in December

Access: 2010 Data

• 27.9 million (9.7%) people live in low-income areas more than 1 mile from a supermarket (2010)

• 2.1 million (1.8%) households live more than 1 mile from store and do not have a vehicle

• 35.6 million (11.6%) low-income individuals live more than 1 mile from store

Access

• Multiple measures:– Area based– Individual-level– Self-reported access– Time traveling to grocery store

• 19.5 minutes in low-income/low access areas vs. 15.5 minutes in low-income/high access areas (ERS analysis of American Time Use Survey)

Healthfulness of Consumption

Healthfulness of Purchases

• What is the extent to which U.S. consumers are adhering to the Dietary Guidelines for Americans (DGA) with their food-at-home (FAH) purchases?– Nielsen Homescan panel data– 1998-2006– Healthfulness measured based on USDA’s

2005 Healthy Eating Index

Healthfulness of Purchases

• Consumers purchase too few fruits, vegetables, and whole grains and too many refined grains, fats, and added sugars (compared to DGA)

• Healthfulness of the average food shopping basket did not improve between 1998 and 2006– Households shifted from refined grains toward whole

grains, but allocate less of their food budgets to fruits and vegetables and more toward processed and packaged foods

Information/Labeling

• The 2005 Dietary Guidelines for Americans (DGA) recommended that half of all grains consumed be whole grains

• A comparison of grocery store bread purchases before and after the release of the 2005 DGA

• Quantity of whole-grain bread purchased rose 70 percent, while refined-grain bread purchases fell 13 percent

Information/Labeling

• Whole-grain prices fell relative to price of refined-grain bread

• After accounting for price changes and other factors, the 2005 Guidelines appear to have encouraged Americans to reduce purchases of refined-grain breads by 3 percent and increase purchases of whole grain bread by 14 percent

Information/Labeling

• Transfat labeling enforced in 2006• How did it affect reformulation?• ERS examined new product introductions

data 2005-2010– Most new food products do not contain trans

fats – Transfat content has been falling across all

product groups

Transfats

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Trans fat levels in new products have dropped dramatically over the last 5 years

Bakery Products

Prepared meals

Desserts

Processed meat/fish/eggs

Snacks

Source: USDA, Economic Research Service calculations using Mintel Global New Products Database.

Average trans fat con-tent, grmas per serv-

ing

Transfats

• New products without trans fats are likely to be lower in calories, sodium, and saturated fats than those containing trans fats. This suggests that food companies generally are not substituting these less healthy nutrients for trans fats when reformulating products to contain no trans fats

Assessing Food Access and Food Environment : Tools

• Food Desert Locator: • http://www.ers.usda.gov/data-products/foo

d-desert-locator.aspx

• Food Environment Atlas:• http://www.ers.usda.gov/data-products/foo

d-environment-atlas.aspx