Increasingly, the foods Americans
eat are imported because bananas, coffee, chocolate,
fish and shellfish, apple juice, cashew nuts,
spices, and other imported foods are produced
in greater quantity or less expensively abroad
or, in some cases, cannot be produced in the U.S.
Since 1980, there has been a general upward trend
in average import shares for both crops and animal
products. Some foods, such as fish, shellfish,
coffee, cocoa, and spices, help boost overall
import shares due to their relatively low domestic
production volumes. Other food groups have lower
import shares that reflect their greater domestic
production volumes, such as dairy products, red
meats, grains, vegetables, and sweeteners, all
of which have import shares 15 percent or lower.
The share of imports consumed
of each food or their combined amounts can be
measured using two different approaches. The first
calculates the imported food share of the total
cost of foods and beverages consumed in the United
States. The second, a volume-based approach, considers
imported foods as a share of the total weight
of all U.S.-consumed food.
Each measure has advantages
and disadvantages. Each provides significantly
different estimates from the other. The aggregate
import share of U.S. food consumption in 2005
was 7 percent when based on value, but 15 percent
based on volume.
Using the Value-based Approach
In the dollar-values approach,
the wholesale cost of foods and beverages consumed
in the U.S. is estimated by adding up domestic
production values and the total import bill. The
U.S. Bureau of the Census reports food imports
in customs value— the closest equivalent
to wholesale prices available. The value of domestically
produced foods and beverages is estimated from
their farm or wholesale values, depending on the
food.
The wholesale cost of fresh produce
and other unprocessed food, for example, is based
on their farm production value or farm cash receipts.
The wholesale value of processed food and beverages
is best approximated by the value of shipments
of U.S. food manufacturers (minus exports), reported
in the Annual Survey of Manufactures by the U.S.
Bureau of the Census.
There are some disadvantages
to this approach, however. Annual changes in the
dollar’s exchange rate can shift value-based
import shares even if the actual composition or
volume of imported food is unchanged. Another
disadvantage stems from the value added in food
processing by the cost of labor, capital, inputs,
and technology. Those value-added amounts can
raise the wholesale value of processed food relative
to unprocessed farm commodities. A pound of french
fries, for example, will cost many times more
than the 2 pounds of fresh potatoes from which
they were processed.
The Volume-based Approach
Introduces Its Own Biases
Estimating the import share
of U.S. consumed foods based on volume involves
adding together the physical weights of all foods
imported into the U.S. and the total weight of
domestically produced foods and beverages. Before
all foods and beverages can be aggregated using
this approach, their weights or weight-equivalent
units have to be compatible. When combining measures
of processed food with unprocessed foods, use
of a base unit, or primary weight, ensures that
computed ratios use common measures.
In agriculture, the base unit
is the physical measure for production, which
is usually in terms of weight. To prevent bias,
processed foods have to be converted back to their
farm weights before they can be aggregated with
unprocessed or fresh foods. Frozen french fries,
for example, weigh less than their fresh counterpart.
Also, when converting beverages with added water
into their weight-equivalent unit, only their
farm-based ingredients are measured.
The farm production volume (weight)
of all foods consumed by Americans can be obtained
from the food disappearance estimates in the ERS
Food Availability (Per Capita) Data System.
The ERS food supply and disappearance tables contain
corresponding import volumes for many food groups.
However, the database does not account for imports
of processed fruit mixtures, such as canned fruit
cocktail, canned and frozen fruit salads, fruit
in confections, bakery, cereal, and dairy products.
Nor does it report vegetables in imported condiments,
sauces, soups, and other prepared or preserved
foods. Since the fruit, vegetable, or grain composition
in these highly processed products are either
unknown or not recorded at the port of entry,
their volumes are not included in import estimates
by ERS. These myriad processed products cannot
be completely converted into their original farm
or fresh weights since accounting for each ingredient
separately is not feasible.
The water content of foods is
a major source of bias in import share measures
based on volume. Fruit and vegetables generally
have higher water content than grains or nuts,
for example. If imports include a large amount
of fresh produce and fruit juices, import shares
based on volumes will be higher than their dollar-value
shares. Despite the high import cost of tree nuts
and many grain and bakery products, their physical
weight will be relatively light in import shares
estimated from volumes. Thus, imported dried or
dehydrated foods must be converted into fresh
weight before being aggregated with their fresh
counterparts.
But the drawbacks of using volume
measures to estimate import shares of food consumption
are relatively minor, in part because close to
half of the value and volume of U.S. agricultural
imports is for horticultural crops and products.