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Mar 12, 2009 04:59 AM

The economics of "locally grown" [split from New England]

Sorry, but locally made has to equal expensive. A small farmer's major expense isn't raising his animals; it's paying the mortgage on his farm. Do you know how much ten cleared acres costs in Iowa? Do you know how much ten cleared acres costs in Connecticut? If we're talking about the straight up economics of it, to make the same profit as a function of costs of living, a farmer in Connecticut would have to charge an order of magnitude greater than an Iowa farmer to clear the same functional profit. Forty percent more doesn't even come within a thousand percent of profiteering.
It is also a far greater strain economically to be a small farmer than it is to be a big agribusiness. It's virtually impossible to set up anything but a small farm in CT. To start with, go ahead and try to find over a hundred cleared acres. You won't succeed. Now try to find a hundred acres, cleared or not, that a town is willing to let you use for farming. Possible, but very difficult. Most towns in Connecticut want to keep any large lots zoned for residential subdivision, because they'll make more in taxes from ten half acre residential properties than they will from one hundred acre agricultural property. Now, here's the hard part: try to get any bank in the northeast, even with the help of the state department of agriculture, to give you an agricultural loan for over a million dollars. Maybe if you're an established farmer, looking to expand, you have a chance. But a start up? No chance in hell.
Now, since you can't set up anything more than a small farm in Connecticut (and yeah, there are a few large farms in the state, but they're all either not locally owned, or have been in the same family for generations), you can't collect much in the way of federal farm subsidies. Farm subsidies are designed to keep the costs of factory farmed products low. They do almost nothing for the farmer producing a product that's worth buying. So, not only does that big Kansas agribusiness pay substantially less for the land that it's able to pack more chickens on to (think something in the order of a nickel for every dollar, combining the factors of the cost of land and free range versus feed lot, and that's being generous), but they are given federal tax dollars. Now, thankfully we finally have a certain someone in a certain highest executive office in the nation who understands that this is an equation that is leading to our nation producing mostly really shitty food, and we'll soon see an end to subsidies for agribusinesses with over half a million in net profit.
But, wait a second, half a million in net profit? Think about that for a second. That's an improvement over the current system. And it's still putting the limit at half a million in net profit. Your Connecticut small farm is lucky if they're making one fiftieth of that in profit. Most Connecticut farms barely break even. To be fair, for a small farm, breaking even still means you have your home and food covered. But don't pretend like any of these guys are wearing Gucci suits and driving German luxury cars. In most of the towns in the state that are still lucky enough to have farms, farming families are the poorest in town. I grew up in a town that had about two dozen small farms when I was in elementary school, down to a dozen by the time I was in high school, and less than half a dozen now, a decade down the road. All of the kids I went to school with that had parents that farmed got their school lunches free, and wore clothes from Goodwill. Half the other kids in high school drove a BMW to school every morning.
Profiteering? Honestly, you've got to be kidding.

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  1. You have the right understanding of the small farmers situation, daniel. Organic farmers loose about 30% of their crops to bugs and vermin because they don't use pesticides and such to repel them, ie, less product to sell , means higher prices to make up for it.
    Fuel and feed costs are HUGE for small dairy and livestock farms and have gone up as much as 100% in the last couple of years. Electric costs have almost doubled. Also, labor and health costs have also gone up, like every other business in the state, nobody wants to work for nothing and everybody wants and needs health care.
    Finally, I don't know any full time farmer that does it for any reason other than the LOVE of what they do, because not one of them makes what most people consider a "comfortable" living. Many have just as much going out as they have coming in and have to struggle to pay their bills all winter long.

    3 Replies
    1. re: chefstu

      the problem with the 'small farmers' is that there is the SAME amount of wastage of crop, whether its organic, or 'not' - given that the US consumer doesn't and wont like what they see as 'ugly' fruit and vegetable.

      The organic farmers are throwing away perfectly good food, in order to fit in with the false aesthetic that US shoppers have with regard to food and crops.

      'Conformity' of shape is NOT a norm in natural food crops - even though the Genetically Modified Crops (including so-called 'organic' crop) seem to deliver a large quantity of similar shaped foods.
      This isn't reality. The organic farmers may be avoiding pesticides (allegedly) - however there's no whisper about either whether they're using 'Frankenfoods' GMO gene-spliced (potentially carcinogenic) products - or, more importantly, whether they're throwing away a sizable part of their yield, because it doesn't 'look as good' as what the dainty shoppers are used to.

      So part of the problem with playing 'eeny meeny miney mo' between organic and regular crop - is that both options are causing anywhere from 10 - perhaps as much as 40% of the crop to be thrown away.

      Unless the wasting of food is of less importance than the thought that one is purchasing 'organic' food.

      Its beyond a simple question of 'is this crop grown from natural soil' - and more an additional question of how is this farmer able to deliver similar looking products to the store? Are they using GMO crops, or 'is this farmer making piles of good food to throw to animals, or rot into compost, rather than ship it to consumers who aren't used to what natural food actually looks like?

      This also begs the question. What do you know of GMO foods? I hope people here aren't mistaking the term 'organic' for 'safe'.
      Even according to US government's own guidelines for food descriptions, the term 'organic' on labels and signs, DOES NOT mean what folks may think it means. If memory serves me right, it has to state '100% organic' in order for the food to actually be what most here seem to think the word 'organic' means.

      So you can actually be paying higher prices, for something that is not even organic in any real sense of the word, and which may also be a GMO 'food.'

      A little bit of research on definitions of 'organic' - according to the FDA, might help some of you go beyond the perhaps false idea that there's some archetypal 'organic' health-conscious farmer supplying your products, and that the signs and labels in the stores are accurate and honest.

      Something simply labeled 'organic' in the USA, does NOT mean 'grown entirely from natural soil without any chemical additives added at any stage to either the soil or the crop' - and it also does not mean 'this farmer didn't throw away a percentage of his crop that failed to conform with US aesthetic norms.'

      So folks seem almost entirely unaware of the federal regulatory situation with regards to 'adequate food descriptions.' Not to mention the underlying issue of 'health' as being more than just a about oneself - but about the larger issue of food wastage, food technology, and deceptive practices being employed to delude consumers who aren't seeing the bigger picture.

      1. re: TheFamine
        This is the web address to the USDA regulations, these days you can't just call your farm and products "organic" without a substantial documentation.
        I don't know any farmers that throw away 40% of their crop without going out of business, no mater how much they charge for it. To say that they do is PURE B.S. To allude that small farmers in Ct. are price gouging or ripping off the public is PURE B.S.
        I work part time on a farm, I went to Ag. school and I have a degree in Conservation, maybe I have a little more info available to me than other posters on Chowhound.
        Finally, why don't you go to a Farmer's market and see that all the Farms sell all their produce, not just the pretty stuff.

        1. re: TheFamine

          You're right that the integrity of organic labeling has been eroded over the course of this decade, but you're confusing and conflating issues which are not essentially connected.
          To begin with, your initial complaint was against local farms. Now you're talking exclusively about organic. There's no substantive connection. Local doesn't equal organic. Most local farms don't have the resources to pay for organic labeling. Their farming methods are transparent, and well exceed the standard, so it's a waste of time and money to get certified.
          Food waste is an issue caused by big agribusiness, not by small farms. I can't tell you how many times I have tried to source an ingredient from a small farm in Connecticut and they've been sold out before the harvest. People buying from small farms aren't the average consumer who wants a round, smooth tomato. Most of the folks at farmers markets and joining the CSA's think the uglier the tomato, the better. The demand for the products small farmers produce in New England outpaces the available supply. Anyone who has tried to buy only locally is painfully aware of this.
          GMO's are even more unrelated. To start with, most of the crops where genetic modification has caught on just don't grow in New England. Small farmers also don't tend to grow them even for crop types that will work, because GMO's are patented and expensive. Nearly all the local foods I buy are heritage strains, basically the exact opposite of GMO. Also, there is nothing inherently wrong with genetic modification. The "Frankenfood" terminology is a silly scare tactic cooked up by ignorant activists. The danger of relying on GMO's is that it contributed to an erosion of crop diversity and bio-diversity generally. They also are usually just not that good. Eating genetically modified wheat is not going to give you cancer any more than its going to make you grow a third arm. This is agriculture, not a 1960's science fiction movie.
          The "100% organic" labeling has absolutely nothing to do with farm products. It is for packaged products, like, say, macaroni and cheese, and indicated that all of the ingredients used are organic. Tomatoes only have one ingredient: tomatoes. They're either organic, or they aren't. But it's far more important to know about your farmer's growing methods than it is to know whether or not he paid a government agency to confirm that he conformed to a standard that the agribusiness lobby has stripped a lot of meaning out of.
          Your instincts are right that the big Midwestern organic farms are only marginally better than the non-organic argribusinesses. Business is business, and they have no reason to give a shit about their consumer. They have to get Kraft to buy their wheat, not you. \
          Your complaints are valid, but you're applying them to the wrong situations. Small scale, local agriculture is the solution to all of the issues you raise. The sooner you get behind it, the better off you'll be. Small farms have to get the end consumer to buy their product, or else they won't survive. They can't meet just a diluted standard, because the folks at the farmers market want good tomatoes, not shitty ones that have been certified as such and such.
          Also, chefstu clearly knows what he's talking about. People like him aren't spouting off marketing ploys. If he wanted to make money by tricking people, he'd have gone to business school, not ag school. You have no reason not to trust the people who go into this because they love food. The people you should distrust are the ones who have turned it into an industry. Food shouldn't be an industry, especially when it takes federal support to prop up the rotting corpse of that industry, which is doomed to fail anyway. You might have to pay a little more right now, but, like most things in life, paying more now will be of a long term benefit far exceeding any short term cost difference.

      2. This is so highly suspect on many levels. I wonder about the timing of a post like this, considering the fact that Rep. Rosa DeLauro's so called "food safety" legislation, and I used to respect her, is more in line with an effort to force small family farms out of business in favor of huge corporate/factory farms who can afford the additional expense. I never knew that DeLauro's husband is an executive at Monsanto, a company that is demanding the ability to force genetically modified crops across the board, which also denies farmers the ability to harvest the seeds to plant future crops. I've read about what Monsanto has done to farmer's heare, and around the world, for example, with the Indian government scamming Indian cotton farmers, and sending in troops to arrest farmers that were lied to, and ripped off, and then denied even the ability to glean the seeds to try and get another crop out of what they paid for. This is about legislating the ability to seize farms, and destroy local family farms, and to place us all at the mercy of those who don't believe in food safety. They want to destroy the buy local movement.

        1 Reply
        1. re: JPerry

          What exactly are you saying is suspect? My post was in response to an accusation made in another thread that small farmers, or the markets that sell their products, are profiteering by charging more for their products. It might not make as much sense taken out of context, and the economics discussed don't necessarily apply on a national level, but it's still pretty clearly a defense of the small local farms you seem to share my concerns about.

        2. I'm obviously coming late to this discussion, and I have to admit that I can't even really tell what you folks are arguing about, but the title of the post caught my attention, because it seems to me there's been a recent backlash against those who are promoting "local" eating. I live in an area where eating locally year round is not really an option, but the promotion of local eating, especially during the summer, has been incredible helpful to our small farmers. My in-laws are dairy farmers, and our neighbors are all small farmers, so we've been following this shift in public opinion for years now. And the inital popularity of "buying local" was so helpful. My in-laws were able to sell their milk products at farmers markets, rather than selling it all to a co-op. Our back field is farmed by a couple down the road, and for the first time in 18 years, they are going to be planting squash for sale at the local supermarket chain (Wegmans) - previously they'd rotated cattle corn and clover cover, never being able to earn a profit on human crops.

          Certainly none of these people are earning much of a profit. I agree with the other posters' statements that farming is usually for the love of the land. It's hard work with little financial reward. But the local movement has made it possible for the farmers I know to grow more diverse crops and offer them to a wider audience, which they are all thrilled to do. Could we feed our nation on local food? Clearly, no. Not at this time. But maybe if we start moving in that direction, the possibility will become more viable. My family lost its farm (after 3 generations working it) when the food culture moved away from local, towards the big ag business. So I'm glad to see the return of local food and small farmers, and I hope someday my kids can say they are 3rd generation dairy farmers.