Farm to Institution Purchasing - Tri State Local Food Summit 2017
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The document summarizes a panel discussion on farm to institution purchasing. It provides context on trends in local and regional food systems, including the industrialization of food production and food service management. This has contributed to the loss of small and mid-sized farms. It also discusses the growth in direct and local food sales. The panel then discussed challenges and opportunities for connecting local producers and institutions. The goal of the farm to institution project is to develop networks between producers, distributors, and buyers to facilitate more local purchasing, which could provide economic benefits to small and mid-sized farms.
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Farm to Institution Purchasing - Tri State Local Food Summit 2017
- 1. Farm To Institution Purchasing Panel Tri State Local Food Summit - February 11th, 2017 Carolyn Scherf Local Food Coordinator Dubuque County ISU Extension & Outreach 563 583 6496 cscherf@iastate.edu Court Farm to Institution Purchasing
- 3. Where do you and your family eat? It’s growing For different reasons. At different pace.
- 4. Farm to Institution Purchasing Agenda THE BIG PICTURE Trends in Local and Regional Food Systems Community Food Systems Program Panel Farmer & Buyer Q&A
- 5. I am concerned about… Rural economies Environment Health Animal Welfare Social Justice Source: University of Iowa - Food Is Community Source: Howard, Allen - Beyond Organic An Analysis of ecolabel preferences… Rural Sociology “Locavores” are driven to eat locally because their commitment to do so makes them feel a part of something greater than themselves—a community that shares their passion for a healthy lifestyle & sustainable environment. “ - Ion Vasi, Pd.D
- 6. Local Foods Direct to Consumer sales are on the rise Farmers Markets & Community Supported Agriculture
- 7. SOURCE: ERS Food away from home as a share of household food expenditures has risen from 25% in 1970 to nearly 50% in 2012
- 8. The popularity of local food purchasing is growing. In 1998 a study found 3 institutions in Iowa purchasing $111,000 worth of local food. .013% 1998 - $111,000
- 9. What if… 25% of 22,000 of Iowa’s institutional markets purchased local food at the same rate as those 37+ who currently are? 5,500 - $800,000,000 Est. Opportunity for 4,249 - 16,997 middle-sized farms
- 11. Trends in regional food systems: Industrialization of Production Specialization | Mechanization | Standardization | Consolidation | Greater reliance on off-farm Inputs. This concentration & vertical integration along food supply chains is credited with improving efficiency, reducing costs, and lowering prices for consumers, but is also implicated in the the loss of farmers’ and citizens’ autonomy over food production, processing, distribution, and sales. Source: Ikerd, J.E (2008) Crisis and Opportunity: Sustainabiility in American Agriculture University of Lincoln Nebraska
- 12. Industrialization of production How does it affect rural communities? Nearly 56,000 mid-sized farms were lost nationally from 2007 to 2012 while large farms increased by more than 400. Iowa alone lost about 6,000 mid-sized farms 2007 -2012 Source: Growing Economies Connecting Local Farmers and Large Scale Buyers to Create Jobs & Revitalize Americas Heartland
- 13. Trends in regional food systems: Industrialization of The Food Service Industry Increase Revenue | Lower Expenses | Privide Customer Satisfaction Source: Fitch, Santo - 2016 - John Hopkins
- 14. As an economic enterprise, food service management prioritize: ● increased revenue ● lower expenses ● customer satisfaction Revenue is generated through: ● Management fees ● Revenue from individual institutions ● Rebates from Food Suppliers -Volume Discount Allowances (VDAs)
- 15. Food Service Management Companies form agreements with distributors or directly with manufacturers and producers for rebates on their institutions’ purchases. Volume Discount Allowances “Rebates”
- 16. A manager for a small New England produce supplier describes the system this way: “Say you’re selling a case of apples at $20 and you have to pay 15% sheltered income [or rebate] to Sodexo. So now you have a $23 case that should be going at $20…” “Now the food-service directors in the schools will use a frozen item to substitute the fresh produce.”
- 18. Source: Direct and Intermediated Marketing of Local Foods in the United States(ERS)
- 19. Source: Direct and Intermediated Marketing of Local Foods in the United States(ERS)
- 20. Source: Direct and Intermediated Marketing of Local Foods in the United States(ERS) 85% Produced on farms with gross cash farm income <$75,000 10% $75,000- $350,000 5% >$350,000 Small Farms account for 13% of local food sales Large Farms Account for 67% of local foods sales
- 21. The goal of the Farm to Institution Project Team is to understand the potential for institutional local purchases and quantify the benefits of institutional purchases if made at the local level. Additionally, this team helps connect and develop a network between producers, aggregators and institutional buyers, providing events and resources to understand and address constraints to large scale institutional purchasing of food.
- 27. Farm to Institution Collaborative Farm Bee Branch Orchard Double Up Food Bucks Farm to School
- 28. Panelists 5 minute intro : Mission/ Vision of organization or business Background of buying or selling local Why is this important?
- 29. Your Turn!!
- 30. Panelists Questions What are the hurdles to this type of business model? What resources have been helpful to start?
- 31. Dubuque Eats Well Farm to Institution Project Team Food buyers including hospitals, local grocers, mother houses, and others. Distributors, food hubs, area farmers, local government staff, elected leaders, small business development center, and Extension food systems professionals are a part of the DEW Farm to Institution Project Team. ISU Extension & Outreach - Local Foods Team, ISU Community Design Lab, Dubuque County ISU Extension & Outreach Iowa Food Hub Public Partners West Union Based Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor Private Partners Lorem ipsum dolor sit amet, consectetur adipiscing elit, sed do eiusmod tempor
Editor's Notes
- Thank you for coming today to learn more about building a food systems that work for everyone. Food systems can be divided into two major types: global industrial food system or local/regional food systems. We have a diverse group of people in the room today including farmers, buyers, and community members, and I am going to assume you know a little bit about these systems… Our goal isnt to posit one against the other but rather - to help you understand what the specific benefits and challenges are when it comes to local food purchasing at the institutional level. We’ll do this through sharing research and hearing directly from local farmers and institutional buyers in our community. Finally, we will leave you with a few resources and ideas for next steps is this is an area you are interested in learning more about.
- Before we continue, I’d like to introduce myself and our panel today. My name is Carolyn Scherf I work with Iowa State University Extension and Outreach in Dubuque County as a Local Food Coordinator. In my role, I work on a myriad of projects with different partners ranging from gardeners to city governments, providing resources and facilitating groups to expand local food systems - One initiative we work on with partners in the community is the Dubuque Eats Well Local Food Working Group, where we have a farm to institution working group, which we’ll discuss a little more later on.
- I invite you to consider for a moment where you eat food. When you buy products at a grocery store, who is their supplier? Are you a student – do you eat food at school? Vending machines? Gas stations? Long term care facilities… When you eat there, how much of that food is local?
- Just to offer a littble background / context. A growing number of people today are concerned about the environment, health, animal welfare, and social justice implications of their food choices and want to eat in ways that are not just tasty - but also which reflect their values in these areas as well.
- Over the last few decades there has been growing public interest in the structure and effects of the United States food system, and this has helped catalyze the growing demand for regionally and sustainably produced food in recent decades For many of the the same reasons people want to purchase local food for themselves and their families at direct markets like farmers markets and csas , there’s an increasing number of people want to eat in ways that reflect their values when they are outside the home,
- As a general trend, people these days are spending more money outside the home on prepared foods. In addition to the convenience having more regionally produced foods would offer to folks who share the aforementioned values, The immense scale and purchasing power that large institutions have them in terms of influencing the way food is produced, priced, and distributed has led many people to being organizing efforts to reform institutional food procurement practices.
- To illistrate that economic [power - i offer the follwoing example. Based on a study done my the RFSWG… the Union for concerned scoientists…
- They furthermore estimated that if…
- The desire to support local farmers is often cited as a top reason to support local farmers. But there are many resaons…. To understand the characteristics and impacts of institutional food purchasing, it is first necessary to look at the U.S. food system and describe trends in regional food systems.
- The industrialization of U.S. agriculture, largely over the latter half of the 20th century, was characterized in part by specialization, mechanization, standardization, consolidation, and a greater reliance on off-farm inputs (e.g., pesticides and pharmaceuticals) with the majority of U.S. farmers abandoning diversified farming systems in favor of specialized operations that separate crop and animal production.15 Large corporations began to finance and operate industrialized food production facilities, acquiring small businesses and merging with other corporations to control multiple stages along the supply chain of agricultural products.8,16 icThis concentration and vertical integration along food supply chains is credited with improving efficiency, reducing costs, and lowering pres for consumers, but is also implicated in the decline in value of workers’ wages17 (in one survey, only 13.5% of food system workers reported earning a livable wage18), and the loss of farmers’ and citizens’ autonomy over food production, processing, distribution, and sales.8,9 Regionalized food systems were largely replaced by national and global systems, dependent on the processing and transportation of food over long distances.
- The markets for food service management and distribution have become similarly concentrated, with the top three management companies operating food services in an estimated 45% of all North American institutional food service outlets (see Figure 1 on page 5). Food distribution is perhaps even more concentrated, with Sysco Corporation and US Foods Inc.—the two largest distributors— bringing in $65 billion in combined annual revenue, or an estimated 75% of the national market for broadline distribution services.19 One of the aims of our group is to research what this breakdown is locally.
- Never the less, Local food sales are on the rise with programs like BFBL popping up locally, and farm to school and know your famrer by the USDA. In the most recent census USDA says about ½ of local food sales have been to institutuions and intermediaries. Of all farmers, local porudcers are in the m inotry- only making up about 8% of famrers….
- Most of these local farmers are produce growers - with 34%...
- Never the less, Local food sales are on the rise with programs like BFBL popping up locally, and farm to school and know your famrer by the USDA. In the most recent census USDA says about ½ of local food sales have been to institutuions and intermediaries. Of all farmers, local porudcers are in the m inotry- only making up about 8% of famrers….
- Now i’ll have the panel introduce themselves.