Food Price Index in Native American Reservations, Explained

Colonization and its tools violently disrupt traditional food systems for many Native American communities. Data collected between 2000 and 2010 by the United States Department of Agriculture place the average food insecurity rate at 25 percent for Native Americans and Alaska Natives. To understand the availability of food and its household-level barriers, an explanation of the food price index in Native reservations is necessary.

As part of a 12-month study, the First Nations Development Institute collected monthly prices on food products in 40 reservations with the help of several community members. This study designed a hypothetical basket of goods including milk, bread, eggs, chicken, ground beef, apples, tomatoes, regular coffee, and decaffeinated coffee. When compared against the data listed by the Consumer Price Index for Urban Consumers, average food item prices in reservations are higher than similar items in urban areas; throughout the year, the monthly average prices are also more volatile. Overall, this study reports that Native reservations paid $8.41 more for a food basket than the national average.

Whether the higher-than-average prices are a supply issue or a demand issue is undetermined. Typically, food price is determined by the cost of production, packaging, marketing, transportation, and demand factors.This study suggests that transportation costs as well as on-reservation store’s market power could be reasons for these higher prices, which are largely a result of the long-standing lack of government support for food production and Native food sovereignty. In Washington state, for example, hours-long trips to grocery stores are routine for citizens of the Hoh Tribe as food items are often significantly more expensive for smaller product sizes in grocery stores near the reservation. Households must consequently decide whether to shop at on-reservation grocery stores or drive to a grocery store farther away, which comes at the opportunity cost of their time in addition to other transaction costs. 

In all, the policy implications of food pricing are significant. Food price is typically used to determine poverty thresholds for government benefits such as Supplemental Nutrition Assistance Program (SNAP) benefits and Temporary Assistance for Needy Families (TANF) benefits. The higher-than-average prices means that families in reservations hold a lower purchasing power on their electronic benefits transfers than families in urban areas. It is thus of the utmost importance to correct for the supply and demand issues of food pricing so that the benefits of welfare programs, like SNAP and TANF, may be maximized.

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