Wednesday, June 13, 2012

Americans Spending Less Money On Groceries, But Greater Share Of It On Processed Food - June 12th, 2012
Health advocates have one tip for Americans trying to eat less fat, sodium and sugar in their diets: Shop the perimeter. In other words, buy food from the produce, dairy and meat aisles and avoid the inner lanes where processed foods and sugary snacks hang out. But turns out this advice is either badly needed, or being badly ignored, as the greatest portion of Americans' grocery spend is straight from the center aisles.

A series of charts published as part of Planet Money's Graphing America series on National Public Radio's website shows the real reason Americans are getting fatter: Nearly 23 percent of the grocery bill is for processed foods and sweets, making it the single biggest category for household's grocery spend; meat comes next with just more than 21 percent. Compare that to 30 years ago, when meat made up the biggest portion of the grocery bill, fruits and vegetables second and processed foods ranked a distant fifth.

Part of this has to do with shifting costs. The dropping cost of sugar -- down more than 16 percent over the last 30 years -- has made sweets more affordable for manufacturers to make and for consumers to buy. And this category will grow even more -- Kellogg, maker of breakfast cereals, is moving forcefully into the snack category, and PepsiCo is going to start marketing its own line of chips called Stax, theNew York Times reported earlier this year.

Meat today is also significantly cheaper than it was in the early Reagan years, which means it takes up less of the total grocery bill. All the major meat groups -- from steak to chicken legs -- have seen significant price cuts over the past three decades. Pork chops have seen the biggest price drops, going from $6.00 per pound back in the day to $3.72 today. Steak has also dropped in price from $7 on average to $4.90 a pound,according to the Planet Money data breakdown. All prices are in 2012 dollars.

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