CHARLOTTESVILLE — Dick Proutt is a small farmer. A very small one. At
Down Branch Farm, he raises chickens and quails and grows lettuce,
squash, melons and tomatoes on about an acre. In high summer, his
weekly haul might include just five dozen quail eggs, 40 pounds of
tomatoes and 20 pounds of squash.
The Jefferson Area Board of Aging
wants exactly that kind of food for the more than 3,000 meals it serves
each week. But it needs 100 pounds of tomatoes. And that’s for one
day’s worth of salads at its 11 area senior citizen centers. Until now,
JABA had only two options: Cobble together an order by making weekly
pickups at several local farms, or call a one-stop national
distributor.
But this month, Proutt’s tomatoes showed up in a salad of local
lettuces and carrots at JABA’s day center in Charlottesville. Proutt
dropped off his harvest at the Local Food Hub,
a new nonprofit group that aggregated his produce along with that of 20
other local small farmers and delivered it to JABA’s central kitchen.
Projects like the Hub are popping up around the country. And they
could be the missing link between supply of and demand for products
grown close to home. In Louisville, Grasshoppers Distribution sells the produce of 100 state farmers to 75 restaurants and schools. In Burlington, Vt., the nonprofit Intervale Center
is aggregating produce from 20 farmers to sell to individuals and, this
winter, to local restaurants, hospitals and universities. In Northern
California, the pioneering Growers Collaborative estimates that over the past year it delivered 400 tons of local produce to Kaiser Permanente’s 19 regional hospitals.
Such networks also are a priority for the Obama administration, which
hopes they will improve rural economies and promote healthful eating:
“What we’ve got to do is change how we think about, for example,
getting local farmers connected to school districts because that would
benefit the farmers delivering fresh produce,” Obama told the
Organizing for America health-care forum last week.
“There are so many new producers cropping up in America. Their best
opportunity to expand is a local market,” said U.S. Secretary of
Agriculture Tom Vilsack. “It’s enhanced if they can be joined together
with other local producers so sufficient quality and quantity can be
established for schools, hospitals, jails and other purchasers.”
The Local Food Hub’s director, Kate Collier, hadn’t intended to get
into the wholesale produce business. She and her husband, Eric Gertner,
own a gourmet food store, Feast, in Charlottesville. Feast sells jams, chutneys, meats, cheeses and produce; the produce has the lowest profit margins.
In April 2008, Collier made a presentation to a panel convened by local
food advocates that outlined how a new distribution system could
support small farmers and improve access to their products. “I told
them, ‘This is where I see the holes are,’ ” she said. “Everybody
jumped on the idea. They said if there was one phone number to call,
they’d do it.”
Last fall, Collier began to put a plan into action. She raised
$305,000 from local foundations and individuals and established a
nonprofit group. She leased a 3,100-square-foot warehouse. She bought a
refrigerated truck for deliveries and purchased $3 million in liability
insurance, a requirement to sell to large institutions. She also hired
a staff of five to market the new organization, manage the warehouse
and educate the community about the benefits of local food.
Farmers and local businesses have welcomed the Hub, which began
making deliveries in early July. Proutt, of Down Branch Farm, was the
first to sign up. The former cabinetmaker had seen his business dry up
with the building bust and had decided to try farming as a second
career. This spring, he sold at the Charlottesville farmers market. “It
was neat to talk to people. But for us, we have so much work to do out
here, it was a waste of time. We can make more money in the morning
with one delivery” than by spending a day at the market, Proutt said.
Larger farms also see benefits. By selling to the Hub, Roundabout
Farm’s Megan Weary spends more time farming and less time marketing and
making deliveries.
For example, working with a company such as Whole Foods Market
requires a mountain of paperwork. Weary has sold to the high-end grocer
since 2006. This summer, it took six weeks to get her heirloom tomatoes
into stores.
“It’s not a waste of my time. But the six weeks I spent chasing Whole
Foods is six weeks I could have been selling them tomatoes,” Weary
said. “So the Food Hub does two things: They consolidate my deliveries,
which makes my life easier, and they consolidate the time it takes to
build relationships with those bigger buyers.”
Institutional customers have embraced the Hub. After six weeks in
business, the Hub had signed up 30 customers, including independent
grocery stores, restaurants and several Charlottesville area elementary
schools. Collier is in negotiations to sell to the University of
Virginia dining services, run by food service behemoth Aramark. U-Va.
is responding to students’ desire for local food, said Bryan Kelly, the
university’s executive chef. Kelly sees the Hub as a liaison that can
balance the needs of farmers and institutions.
Again, that’s not easy. The Hub has established a small distribution
system. But it can’t compete on price. National distributors and food
service providers scan daily commodity market prices. In high season,
zucchini sells for about 40 cents a pound. The Local Food Hub sells
zucchini for what it considers a fair price: 94 cents a pound.
Buying local produce also increases labor costs. That
40-cents-a-pound zucchini can come washed, chopped and bagged, while
local squash must be prepped by the buyer. “It’s a huge change for
institutions,” said Judy Berger, JABA’s community nutrition manager.
“When you fix thousands of meals, you want the quickest, easiest way to
do it. Food from California that’s prepped and ready to go is, for
crazy reasons, less expensive.”
Some institutions are willing to stomach the changes. JABA, for
example, preps local produce from the Hub and other farmers for all of
its centers in its catering kitchen. And it directs proceeds from
catering to cover higher produce prices. But Cavalier Produce, a
regional distributor, is not buying as much as the Hub had hoped.
Cavalier does sell the Hub’s specialty items, such as squash blossoms
and purple potatoes, to chefs. But at the height of tomato season,
Cavalier can purchase tomatoes from other Virginia farmers a little
farther afield for less than half of what the Hub would charge.
“We’re trying to make it work, but we have to stay at the market
price,” said Spencer Morris, Cavalier’s general manager. “If I went out
to my customers at double the price, I’d lose business.”
Local distributors do have one competitive advantage: Unlike
national companies, the Hub knows the source of every tomato, potato or
apple it delivers — a plus in an era where
E. coli
outbreaks make regular headlines. But, says Josh Edge,
farm-to-institution manager at the seven-year-old Growers Collaborative
in California, it is difficult to turn a profit. “The distribution
business is about economies of scale,” he said. “We can’t compete with
the national guys.” The Collaborative was originally set up as a
nonprofit organization; in 2006, it tried to operate as a for-profit
corporation. Last year, it returned to charity status.
The Obama administration has plans to help. The Department of
Agriculture is required to put at least 5 percent of its business and
industry budget into developing local production. “That’s the floor,”
Vilsack said. “What we’re looking at is how can we more effectively use
[those funds] to create a whole new way of thinking about the rural
economy. Be assured it’s one of our priorities.”
Collier projects that the Hub could turn a profit with revenue of
$1.5 million annually. If all goes well, that could happen in six to
eight years. In the meantime, small farmers are taking advantage of the
opportunity to find broad and steady markets for their products.
“It’s nice to know you don’t need to have 200 acres,” Down Branch Farm’s Proutt said. “You can still make it work.”