The above statement is TRUE. Explanation: Farmers produce foo | ECONOMY by VIVEK SINGH

The above statement is TRUE.
Explanation:

Farmers produce food items and sell in the market and whatever they earn, they spend in food and non-food items both.
Let us assume that:
Food inflation = 8%
Non-Food Inflation = 4%
Overall/average Inflation = 6%

Since food inflation is higher, so farmers income will increase more (8% keeping other things constant) as compared to their increase in expenditure ( which will increase by overall inflation rate i.e. 6%), So farmers will be more well off and the terms of trade will be in favour of the farmers. Those people who will be working in non-food sector their growth in income will be 4% (keeping other things constant) but their overall expenditure will increase by 6%, So they will be worse off.