Do the math — oil & neighborhood food shopping

This post on Impact of high oil on the spatial economy prompted some interesting comments and got me thinking with a calculator.

The issue is whether there is a plausible scenario for neighborhood food shopping i.e. within 3-4 blocks. Now let's put aside that a vast number of people live where there are no neighborhoods in a traditional sense and the only stores which sell food are either tiny -— a Seven-Eleven — or huge — a big box such as Safeway, Walmart, Krogers etc etc. So they have no current choice to go anywhere but a big box.

So let's look at one very narrow factor of food prices — the cost of distribution and of moving food long distances across the USA by truck.

My assumptions (and bear in mind that these are "order of magnitude" reckonings.) :
• the payload of  a semi-trailer is something like 40,000 pounds.
• shipping distance is 1500 miles.
• projected cost of diesel fuel is $8.00/gallon
• semi-trailers get somewhere around 6 mpg (though I found references to the possibility of 10 mpg, which would of course change a lot of these calcs, but we'll stick with 6mpg for now.)

The semi will need 250 of gallons of diesel to go 1500 miles.

At $4.00 gallon that's $1000.
At $8.00 gallon that's $2000.

Scary stuff. But let's do the numbers before we panic.

We are looking at shipping one semi-trailer load of 40,000 pounds, So the increase in cost  per shipment (also assuming there is a backhaul) is $1000 of additional fuel cost divided by 40,000 pounds of food, or about 2.5 cents per pound of food. With food costing at least (for even cornflakes) at least $2/pound, that 2.5 cents per pound doesn't look like a lot.

Of course every bit hurts and we haven't considered the cost of oil buried in food from farm equipment, fertilizers etc etc. But remember, my analysis is aimed at one narrow question: shopping patterns spatially.

Where do I err?

Now don't misunderstand. I am not saying that these dramatic increases in fuel prices will not precipitate enormous changes: they will and some will be quite disturbing and challenging. But let's make sure we put things in correct  proportion. Nor am I saying that we shouldn't have different national and local policies which would lead to different spatial patterns. My exploration is simply to see if the kind of end-of-the-world talk coming from folks like Jim Kunstler make much sense.

•••

Furthermore, an awful lot of food — whether it is bought in a big-box or neighborhood boutique — must for reasons of climate come from far away. They don't grow wheat near New York City and we don't grow rice near  Seattle. So it makes no difference whether the food is going to one huge store or dozens of small ones because the food comes from far-away in any case.

Then to those who suggest that we eat local, that's fine. I have no problem with such a philosophy (though I don't particularly share it) and when the price of tomatoes from the environs of  Seattle is as cheap as those from Mexico, we'll all switch.

 

Comments

[Daniel Nairn]

I don't see anything wrong with your calculations, but as all of these little costs do mount there may be a tipping point within reach that would push people toward more localized shopping.

For example, right now I can walk to a farmers market every Saturday and pay a bit of a premium for local food and community atmosphere. It's actually not much more expensive though. I'm pretty stingy. Most people are understandably not willing to forgo better selection and price for this, but I think it could only take a marginal shift in relative costs to make the local market a much more compelling option.

Your point about the lack of traditional neighborhoods is well taken. Most people just don't have the option to walk to a market like I do. That kind of major change in infrastructure would take a long time and a lot of money. I think it's an open question whether it will happen or not.

[Brian]

If the system really begins to undergo stress, might there not be a situation in which the fuel is not reliably available? Spot shortages may not impact the costs per se, but they may play havoc with just-in-time distribution systems.

[M1EK]

I've likewise been very frustrated at the innumerism displayed by Kunstler and his more rabid acolytes - people who basically will tell you that "if the price of oil doubles, the price of everything else doubles too".

No, no it doesn't. The only thing that would precisely double is the price of the oil itself; nothing else has a 100% input of oil!

[dex]

I'm interested to know what the forces were that led to the rise of big-box shopping in the first place. I suspect fuel prices had a small (direct) impact.

It's more likely that the rise of the two-income family and the ensuing shift to more highly-processed foods was more significant. Higher cost for those foods (due in part to higher fuel costs) could be a factor in reversing that trend. And *that* could be very interesting.

[Daniel Nairn]

To the extent that Kunstler-types are putting exact numbers on things, I can't follow them. However, when it comes to such large systems such as oil-based agribusiness I can only invoke chaos theory. There are tons of factors, not all of them even remotely quantifiable, and feedback loops everywhere. It seems to me that a Kunstler scenario of localization is at least possible.

Here's a couple of factors that come to mind:

1. Transportation: what we've been talking about.
2. Production: fertilizing and processing is quite oil intensive.
3. Land availability: If urban sprawl recedes, more fertile land closer to end of the supply chain would be available for local ag.
4. Political support: If clout of Agribusiness wavers, they may lose power to acquire the essential government subsidies.
5. Labor market: Since local ag is more labor intensive, lower wages across the economy would favor this system.

[Fnarf]

Trains. Move more food on trains, which are many times more efficient than trucks. Move it on trucks only locally.

[DanB]

Seatimes ran this NYT piece today:

http://seattletimes.nwsource.com/html/nationworld/2004435760_coping24.html

"Big box retailers are suffering as customers balk at driving to the mall."

Not backed up with data, and unclear about how much they are suffering, but I don't think the authors are totally making stuff up.

Interesting also the calc for average cents per mile: 15 today, was 5.6 in 1998, peaked at 17 in 1980.

[David Sucher]

DanB.
Don't forget a sentence just prior to the one you quoted:
"...consumer confidence has fallen to its lowest level since 1980." So have mall sales gone down while main street sales have gone up? I think that's a relevant question.

[Melie Bianco Handbags]

I've been a big proponent of buying food locally, it incredibly reduces the wasted energy. But more importantly nothing beats real farmer's market produce and fruits.