I sent Tom a kudu on his story today.

Search on Google for agriculture future trends and you will find a page in my web # 1.  Eventually, almost all ag will be local - we are not going to be flying in 747s of strawberries from Chile and shipping meals 1,500 miles to your dinner table from Florida and California.

Presently we are still eating under the influence (EUI rather than DUI) of still cheap oil and the corporate agribusiness model built over the past 56 years on cheap energy.

Agriculture in the USA presently consumes 10 calories of fossil fuels for every calorie of food produced.  That's not long term sustainable.

I have one idea that will help.  Read:

www.roncastle.com/ecocover/

We are planning on replacing plastic film used for agricultural mulch.  Over 3 million acres are mulched with plastic in the USA every year.

The future is EcoCover.

Cheers,

Ron Castle

Cheers.

It's also important to note that the USDA statistic for "revenue" does not count the equity farmers are building by investing in land and equipment.  So if you gross $70,000 in sales, but make your land payments, buy a tractor, put in a new irrigation system, and build two greenhouses at a cost of $70,001, your revenue is considered negative.  Since many market vendors are new operators actively growing their operations, this can also have an important effect on the numbers cited.  

In addition, 2% of $70 billion is $1.4 billion, which is not an insignificant sum of money at all.  If the number of markets is correct, each market is taking in an average of over $450,000 annually.  With an average of 22 growers per market, which the cited USDA report estimates, this means about $20,500 per grower.  I know of few growers, small or not, who sell at a single farmers' market, or rely only on farmers' markets for their produce sales.  

I know several small, direct market growers who also sell to Whole Foods.  Usually they produce a few specialty crops which they wholesale, in addition to the diversity of things they grow for market or CSA.  In my own research with small direct-market farmers in Michigan, though not a comprehensive statistical survey, I have actually found that experienced growers with established operations usually don't have off-farm jobs.  Their small debt-loads, and ability to produce many of the things they need on the farm, allow them to make a living despite their size.  

USDA statistics also point out that a disproportionate number of market vendors are organic, or use practices similar to those of "certified" growers.  This keeps costs low, and prices high.  Many small farmers also grow high value crops.  There are a significant number of Michigan blueberry growers who have small farms and decent incomes.

It needs to be pointed out that while a small conventional commodity (corn, soy, wheat, cotton, rice) farm may operate at a loss, many diversified vegetable and fruit farms, especially those who direct-market, are actually able to support a family.

Taylor

I do research with small farmers in Western Colorado, and even the diversified ones that are more than hobby garden's aren't making a go of it economically.  They just can't make enough money selling their produce, even the ones that sell at high end markets like Aspen and Telluride.  The ones that are doing well, in my opinion, have invested significanly in value-added products such as wine, jams/jellies, or organic cut flowers that they can get high profit margins on.  In terms of selling produce, if small growers actually charged enough to make back their inputs, lettuce or tomatoes would rise to what Americans would consider to be an extraodinary price. And, of course, since organic/sustainable farming is more labor intensive, labor cost will always be an issue, and you'll have a small farmer working 70-hour weeks with no help, just to keep the weeds at bay and harvest the crops; paying someone $7/hr to help just won't cut it.  Lots of farms get help from WWOOFERS and interns, but economic sustainability is a far-off dream for most of the small farmers I interview.  

What will change that?  Some ideas:

1. Widespread acceptance that you get what you pay for, and maybe a $4 (as opposed to $2) tomato is not only healthier but supporting an America you are proud of.  

2. Acknowledgement by Americans that maybe spending 25-30% of one's income on food (as opposed to current low percentages) is worthwhile and necessary since, after water, it is the most important thing keeping one alive.  

3. A willingness by farmers to be business-people as well and move beyond the passionate approach that led them to farming.  Farmers need to think about diversifying not simply in terms of crops grown but in products sold; people will pay for herbal lotions, wine and soap at a level they won't currently pay for produce.  It may be unfortunate, but it is true.  Almost every farmer I know has an off-farm job or a spouse with one; if economic self-sufficiency is a goal, somthing has to change.

4. And finally; a political revolution - Down with Bush!  :-)

Next, you write that: "the USDA statistic for 'revenue' does not count the equity farmers are building by investing in land and equipment." By revenue, I (and the USDA) mean sales. Sales minus operating costs equals operating profit. Operating profit divided by costs equals operating margin.

But lets looks squarely at your point. Sure, under standard accounting procedure, spending money to buy a plow wouldn't count as a cost, but rather as an asset. You claim the USDA doesn't use standard accounting procedure in this case. You write: "So if you gross $70,000 in sales, but make your land payments, buy a tractor, put in a new irrigation system, and build two greenhouses at a cost of $70,001, your [profit] is considered negative." Fine. But who making 70 grand a year has 70 grand to spend on that stuff? Now we return to my point: Farming doesn't generate enough cash for farmers to make the investments they need. So how do they do it? Off-farm income.

In your area of Michigan, small veggie farmers may be well-capitalized enough to operate without outside jobs (or souses with outside jobs). In most areas of the country, as USDA numbers show definitively, off-farm jobs, held by farmers themselves or family members, subsidize small-scale farming.

As for Whole Foods, before the recent new initiatives, most Whole Foods outlets I know of were willing enough to buy local -- so long as you could match the going price (known as the "California price" in some farming circles) of the given good. This pits small, local-oriented operations against large-scale, highly capitalized California farms with access to undocumented immigrant labor (and the world's cheapest gasoline). From my experience, few truly small-scale farmers (say, with less than 10 acres under cultivation) found such an arrangement useful. We'll see what happens since Wholes Foods has become, let us say, Pollanated. Will the company pay pay up for local? If not, we're back to square one.

Finally, you write that: "If the number of markets is correct, each market is taking in an average of over $450,000 annually.  With an average of 22 growers per market, which the cited USDA report estimates, this means about $20,500 per grower." Fine. Let's say every grower in this category brings in $20,500 from the farmers market, and the same amount from other operations (CSAs, etc.) That's $41,000. After buying seeds, gas, packaging, inputs, etc. etc., will there be enough left over to feed a family and invest in the operation -- without outside income?

Finally, and I mean it this time, there are outliers in any group who can be used to generalize. For example, you may know a guy who group up in a dilapidated housing project with a drug-dealer dad and a TV-zombie mom who's now a very prosperous lawyer. But that doesn't mean that neighborhoods with lots of dilapidated projects, drug dealers and TV zombies can expect to produce many prosperous lawyers. Same with small-scale farming. For every Elliot Coleman or Joel Salatin -- from whom small farmers can learn much, to be sure -- there are loads of people working extremely hard for very little gain to produce excellent food. Unless we figure out a way to reward them better, we might not be able to count on their largesse for much longer.

Victual Reality

Thanks for your thoughts on my response.  You make a number of valid points.  I certainly don't disagree that it is tough to be a small farmer these days, and I agree that in general few are prospering.  I was not trying to challenge the fundamental tenets of your article.  My points, if I may restate them are simply these:

First, The USDA numbers seem out of whack.  If you assume a current US population of 300 million, at $70 million in total sales, this means that the average produce bill per capita is $230 per year or $0.63 per day.  Perhaps I am deluding myself, but even in a culture that eats as few fruits and vegetables as ours, this seems low to me.  My point about 'hobby farmers' is that their sales actually are counted in USDA numbers, and can skew them significantly.  According to USDA, over half of all US farms (58%) had sales of less than $10,000 in 2002, and a lot of these folks sell at farmers' markets.  My point is simply that they affect the USDA statistics.  

Secondly, I still think it's important to point out that there are exceptions.  Again I am not disagreeing with the fundamental premise that it's tough to be a small farmer, and a lot of them are not making it.  But I do think that the exceptions are important.  They point out the need for a different way of thinking about and managing small farm operations in the US, and a lot of new, innovative farmers are using alternative models (Salatin's, Coleman's, or their own) in finding ways to make small farms work.

I hope you would agree that small farms are an important part of American agriculture, and that we need to find a way to make them work.  In my response, I was simply pointing out that there are people doing this, and I believe that their numbers, and their importance in providing a secure, healthy, accessible food supply in this country is growing.  I think this is a goal that is worth working toward.  I fully agree with your contention that it is a long way off, and that the current system cannot sustainably produce our local food needs.  At the same time, I am hopeful about what I see as a growing small farm movement that can be a vital part of our food system, and I  don't think we should discount its importance or write off its potential.  

Most small farms certainly struggle, but this is true of American farms in general, no matter what their size.  It is not just small farmers who rely on off-farm work, it is 93% of all American farmers.  Research shows that even with commodity production, economies of scale top out at around 650 acres, and I don't think that a sustainable food future is inherent in the move to mega-farms which ship produce across the country or around the world.  

I think that what we need is a fundamental change in the way that we think about, and produce our food.  It may seem a daunting task, but change is something that happens gradually, and I think we are beginning to see it in successful, small, locally-based farms.  I agree that their current contribution is not sufficient to meet our local food needs, and that their challenges are significant.  At the same time, I think they are a vital and growing part of a sustainable food future, and that their contribution and potential should be acknowledged and encouraged.

Thanks again for your thoughts, and for your contribution to the public dialogue on this extremely important issue.

Taylor

Thanks for providing such an insightful post and comments too!

If interested Organically Speaking a Seattle base website has released a conversation with Michael Pollan podcast (audio conversation). Interesting tidbits on farmers markets, CSAs, and more!

Some Podcast Show Note Questions:

Q) Why the price difference between conventional food and organic and how do we go about bringing down organic food prices?

Q) How can small local organic farmers remain local in a capitalistic system?

Q) What is the "Food Web" you briefly touch on in your book, The Omnivore's Dilemma: A Natural History of Four Meals.

http://OrganicallySpeaking.org

All the best,
-Ricardo

Holistic Conversations for a Sustainable World

If I give away the development rights to a land trust then I am giving away my retirement, my insurance policy, my savings and there will be no benefit because the "tax incentive" is useless - I don't have enough income to offset. That is true for most small farmers.

One of the things I have run into is that the land trust people, and others, don't understand that our land is our retirement fund, our health insurance, our disaster insurance, our savings. We don't have a 401K, IRA or any of those fancy things. We also aren't likely to get much or any social security even if the system exists down the road. I can't just give away for free the equity that we have worked hard to build up. Would you just hand your retirement plan over to some bum on the street?

Just as importantly the land trusts offer only a pittance for the high value of our land's development rights. Mostly the land trusts want us to donate the development rights but sometimes they offer to buy them. Their explanation is they have a tight budget - hey, I understand, but so do I. Land trusts offer about $2,000 per acre. I can sell the land for $5,000 to $100,000 per acre. If the land trust wants to get the land then they need to offer a lot more. The math says it is better for me to sell a few acres for home lots - I'll get a lot more money than conserving a lot of land - and then continue to farm the remaining land.

The process of going through with the land trust is very expensive and complicated. I've worked through it multiple times and I really don't have the time to waste. I've got farming to do. In the times I've dealt with land trusts I have felt like they treated me as if I was not important. That's fine. If they've got other fish to fry just say so. Instead they drag the process out. Take huge amounts of time to respond. Miss deadlines. Change personnel. Lose files. In general an unprofessional process and a waste of my time.

There is no long term tax incentive because my real estate taxes, one of our biggest annual costs, don't go down when the land trust buys the development rights. In fact, they actually could go up. It's complicated but a real factor and not something the land trusts like to talk about.

Then there are the tax disincentives. My real estate and income taxes will get more complicated and possibly higher every single year if I do the land trust thing. I would have to pay a capital gains tax on the income from the sale of the development rights at both the federal and the state levels. My tax forms go from being something I can handle to something requiring an 'expert' who makes hidden mistakes (been there, seen that) and costs me a lot each year. The government has put hurdles in the way that make this sort of thing even less appealing.

As much as I like the idea of land trusts and conservation the system is not working for small farmers. The whole thing is geared toward rich folk who want to donate the easements on their land and gain a tax benefit to offset their high income. Small farmers are in a very different boat and the whole land trust thing isn't working for us or other small farmers I've talked with.

What we really need is to end all subsidies. Subsidies go to only a few (6%) of farmers and most of those are big corporations. This means that my tax dollars are helping my competition and I don't like that. We need to eliminate the subsidies to everything, not just farming. If all subsidies were eliminated then the cost of petroleum would take on it's real value. That would mean there would no longer be the shipping of cheap goods half way round the world or even across the country. This would create more local jobs in farming, manufacturing and other job sectors. Yes, there would be some turbulence as the market settled but we would save on taxes when we no longer spent hundreds of billions on subsidies - that would offset the price increases.

http://NoNAIS.org http://SugarMtnFarm.com/blog http://HollyGraphicArt.com