Agile Agriculture Tackling Local Foods Issues on National Level
Last summer’s Agile Agriculture Summit created work groups that are dealing with local foods issues, practices and policies.
Mention the topic of local foods, and most people think of small-farm producers selling fresh fruits and vegetables at farmers markets, or selling niche products directly to high-end restaurants. But on a national level, there is much more to the local foods movement – and the opportunities it offers the Farm Credit System. Just ask Gary Matteson.
Matteson, VP, Young, Beginning, Small Farmer Programs and Outreach with the Farm Credit Council in Washington, D.C., is part of an 8-member work group titled “Financing the Foodshed.” It’s part of a large-scale program called Agile Agriculture, implemented by the University of Arkansas and its Applied Sustainability Center.
The long-term goal of Agile Agriculture is to provide easy access to agricultural products that are grown locally, which are fresher, more nutritious and employ reduced transportation costs, while benefitting both local farmers and retailers. The effort is funded in part by a $550,000 grant from the Wal-Mart Foundation.
On June 30 and July 1, 2009, the University of Arkansas hosted the first Agile Agriculture Summit. It was attended by 131 participants from 27 states, plus Canada and France, and brought together people from farms, universities, organizations involved in sustainable agriculture, national food distributors, farm organizations, the USDA and the Farm Credit System. “This is a multi-disciplinary project,” said Matteson. “It’s a pretty broad range of people that wouldn’t normally get together. That’s the whole point – to get people together to look at how local food systems can be encouraged, and what such systems would look like based on their own interests.”
During the two-day Summit, a variety of teams were formed to design projects that take into account the foundations of Agile Agriculture:
- Promoting sustainable agricultural production systems
- Ensuring profitability to producers and distributors
- Providing social benefits of local foods
- Delivering healthy products to consumers
Mike Faupel, Program Manager at the Applied Sustainability Center, believes that whether it’s bringing fresh locally grown produce to farm markets, inner-city stores, or “big box” retailers in rural America, there are many unmet opportunities. “When you find the sweet spot between something meeting a business model providing opportunities for producers, and providing healthy products for consumers, there’s a lot of room there for increasing these systems and ramping them up fairly rapidly,” said Faupel.
In addition to the Financing the Foodshed work group, other teams are dealing with governance, policy, agripreneurship, entrepreneurial livestock business model, production technology, supply chain transparency, social benefits, consumer engagement, produce hub, and marketing and finance education.
Members of Matteson’s work group – all involved in one way or another with sustainable agriculture – include representatives of the U.S. Department of Agriculture (USDA); Rural Advancement Foundation International (RAFI); Los Kitos Produce, LLC; University of Arkansas Applied Sustainability Center; the University of Minnesota; and Alcorn State University.
One of the recommendations of Matteson’s team will be to encourage government policies around the concept of a “Foodshed Enterprise Zone” in areas where there is both demand and supply of local foods in a geographic area that need to be connected. “Think of Detroit,” said Matteson. “It has an urban population that is suffering low income; it historically has had a nutritional deficiency of fresh fruits and vegetables in its inner city populations, often caused by not having access to a grocery store to buy healthy food."
“On the supply side of the foodshed, there would be a food-growing area that has the ability to become a market delivery channel, a value chain that somebody hasn’t figured out yet. To date, where that has happened, it has been sporadic, very niche-like and small, as opposed to something that is more robust and more economic in the long-term sense,” said Matteson.
In some metropolitan areas, local farmers may already be cooperating and have the ability to fill the demand for food locally, but just haven’t been able to connect with the local market. By taking a public policy approach to identifying a Foodshed as an enterprise zone, much like other government incentives do now, it would allow resources from the USDA to include investment tax credits and labor incentives for hiring. “That would be a nudge to get the supply in the rural area and the demand in the urban area aware of each other and fixed together,” said Matteson. “It’s a great opportunity for new farm businesses, especially for young, beginning, and small farmers.”
Faupel believes that there are tremendous infrastructure needs for producers interested in engaging these emerging markets. “The market demand is there. If the supply was increased, the market demand would come closer to being met. Often, producers need simple access to credit in order to take their operation to the next stage where they can meet these market demands. That’s where Farm Credit comes in,” said Faupel.
Faupel adds that he’s been very gratified that Matteson and his group understand these opportunities for producers and are interested in these emerging markets. “We’ve been impressed that Farm Credit sees this as a business opportunity and the opportunity to provide public good at the same time. There are a lot of different pieces to solving the local foods puzzle and Farm Credit is a big one, providing producers access to credit as they discover new markets,” said Faupel.
Serving the Broader Market
Niche producers are already providing products to high-end restaurants. From the perspective of those involved in Agile Agriculture, the key to success is turning the local foods model more toward serving the broader market. Matteson believes that by broadening the flow of local food products, it creates a local food economy rather than just selling food locally. That requires a broader demand and the ability to use a broader range of supply.
“Let’s say I was growing yellow squash,” said Matteson. “I could sell yellow straightneck medium squash to high-end restaurants, because they’re all the same and they fetch a high price. But as a farmer, I also have big ones or bruised ones or crooked ones that are graded lower. To create a more sustainable use of all of that growing, rather than relying on just the high-end market, the farmer needs to find an outlet in the same city for the same truck that he’s delivering his high-priced product. That would increase his productivity and profitability by finding a broader market.”
Broadening the market for that produce may also lower the price to consumers, making high quality, locally grown food more affordable. That helps fulfill the social goal of getting more nutritious food where it’s needed most, adds Matteson.
Because USDA staff are on seven of the eleven Agile Agriculture Project Groups, Matteson is optimistic that their efforts will eventually enhance the availability of local foods across the country. “The administration has made a positive response to the concept. They are thinking about it. The outcome of the Agile Agriculture effort may indeed be a white paper recommending what a local food enterprise zone would look like, conceptually how it would operate, and within what legal authority. Then it would be up to USDA to figure out if they actually want to do that from an administration policy perspective,” said Matteson.
The efforts of other Agile Agriculture work groups may also create policies that might be looked at by social justice groups, people looking at alleviating hunger, and people who are looking at the problems of obesity or diabetes in urban populations. Many of our national health issues can be mitigated with better diet, better education and better access to fresh food. Faupel agrees. “This is a greater good project. There is room for fresh food for everybody. If you shop at Wal-Mart you should get fresh, local, healthy food. If you shop at a farmers market, obviously the same thing. If you’re eating in a school cafeteria, same thing,” said Faupel.
Large food distributors like Wal-Mart Stores Inc. and SYSCO Corporation are also involved in the Agile Agriculture program. “Wal-Mart funded Agile Agriculture in a large part,” said Matteson. “They are interested in promoting expansion of opportunities around local food systems. They want to have supply available to them so they can buy more local food. That helps them save on distribution costs and logistics costs, and they will have less spoilage, which is a big factor for them.”
Farm Credit Benefits on Several Fronts
Matteson believes that Agile Agriculture and the policies that come out of it will eventually create opportunities for many farmers to sell their goods locally, and hopefully get a higher return because their distribution chain is shorter.
Being part of the Agile Agriculture project also puts Farm Credit in a good position to talk with groups it hasn’t worked with before, such as local food advocates, and those involved in fighting obesity and diabetes. It also creates a forum to educate those who are forming local food system policy. “Part of my role in being part of the Agile Agriculture program is to let the players in this policy environment know who Farm Credit is and what Farm Credit can do,” said Matteson. “We are making Farm Credit relevant to audiences other than the farmers who are our customers, in particular, to policy makers who just found out we have been financing local foods for 93 years.”
A good example of spreading the Farm Credit story can be seen on a new USDA website called “Know Your Farmer, Know Your Food”, a program supporting local food systems. A USDA employee authoring the website is on the Financing The Foodshed workgroup with Matteson. “She asked me if I had an example of a Farm Credit institution that had used a particular program – a Business & Industry loan guarantee from USDA – to support local food system infrastructure. With some quick phoning around the System, I found out that AgStar Financial Services had financed a meat processing plant that makes smoked meat products in their territory. It provided a lot of jobs in the small town where that plant is. So by virtue of being in this Financing The Foodshed workgroup and being asked for an example of this, and being able to go the local Associations, we’re now on that USDA website, with a very positive story about how we serve agriculture and small town economies.”
“The point is not only that AgStar made the loan happen. The point is that this kind of information flow confirms that Farm Credit is involved in this policy area. Farm Credit is serving the needs of farmers and rural America, and that matches up with what USDA wants to do.”