The Function of Food Hubs in Rural Farming Economies

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Organic-Strawberries

Farmer’s Row Strawberries / Michael Licht

April 21, 2016; High Country News

The demand for locally grown food sold direct-to-consumer has increased. According to the USDA, in 2012, 163,675 farms (7.8 percent of farms in the U.S.) marketed their produce directly to the consumer or used a sales intermediary. The number of farmers markets has grown by 180 percent between 2006 and 2014. There are economic and logistical difficulties for producers using that system, however. Farmers can spend a whole day away from their farms, dragging their wares to market, selling relatively small quantities of product at low profit margins, and then have to take the remainders back home. Often, they have to haggle for space in the town for the market and deal with prevailing political winds and property owners over parking issues, all while trying to run their farms.

In fact, NPQ has written previously about the emergence of hybrid food chains, entities with threads of for-profit and nonprofit that function in this space, making the work of smaller farms and other food entities possible. Below is another example.

In 2013, the Arkansas Valley Organic Growers in Colorado, a networking group of local farmers, began another avenue for the farmers to sell their goods. The organization leased a school building that was vacant since the 1980s to create a community food hub. They accomplished capital improvements, including coolers, with funding of $285,000 from six private foundations, an individual donor, and the USDA Community Facilities Program. Farmers can bring their produce to a single location, the Excelsior Farmers Exchange. It is sold for wholesale prices, and the farmers pay a fee for the space and the handling by hub staff. Whatever is not sold fresh can be frozen to sell. They now have a place in the building for seed storage, a commercial kitchen, and a chili roaster.

Wyoming, New Mexico, and Colorado have 16 food hubs operating or about to open. The Department of Agriculture is updating previous food initiatives and putting more dollars into food hubs and innovation. The department has helped support 40,000 local food infrastructure projects with about $1 billion across the nation in the last six years. As the food hub operators look towards larger markets, there will be other pieces to modify, such as certification for safe food handling. The government has provided funding for 10 food hubs around the nation to create case studies for efficiency and effectiveness in local economies.—Marian Conway