Local Food: USDA ERS study looks at concepts, impacts and issues

05/17/2010 04:35:15 PM
Tom Karst

 You will want to check out a comprehensive report on local food systems by the USDA Economic Research Service called “Local Food Systems Concepts, Impacts, and Issues.”

The 87-page report, released in May, features timely discussions of “what is local?” , characteristics of local food demand” and more.

From the report’s summary:

Summary

Consumer demand for food that is locally produced, marketed, and consumed is generating increased interest in local food throughout the United States. As interest grows, so do questions about what constitutes local food and what characterizes local food systems.

What Is the Issue?

This study provides a comprehensive literature-review-based overview of the current understanding of local food systems, including: alternative defi nitions;
estimates of market size and reach; descriptions of the characteristics of local food consumers and producers; and an examination of early evidence on the economic and health impacts of such systems.

What Did the Study Find?

There is no generally accepted defi nition of “local” food. Though “local” has a geographic connotation, there is no consensus on a defi nition in terms of the distance between production and consumption. Defi nitions related to geographic distance between production and sales vary  by regions, companies, consumers, and local food markets.

According to the definition adopted by the U.S. Congress in the 2008 Food, Conservation, and Energy Act (2008 Farm Act), the total distance that a product can be transported and still be considered a “locally or regionally produced agricultural food product” is less than 400 miles from its origin, or within the State in which it is produced.

Definitions based on market arrangements, including direct-to-consumer arrangements such as regional farmers’ markets, or direct-to-retail/foodservice arrangements such as farm sales to schools, are well-recognized categories and are used in this report to provide statistics on the market development of local foods. Local food markets account for a small but growing share of total U.S. agricultural sales.

• Direct-to-consumer marketing amounted to $1.2 billion in current dollar sales in 2007, according to the 2007 Census of Agriculture, compared with $551 million in 1997.

• Direct-to-consumer sales accounted for 0.4 percent of total agricultural sales in 2007, up from 0.3 percent in 1997. If nonedible products are excluded from total agricultural sales, direct-to-consumer sales accounted for 0.8 percent of agricultural sales in 2007.

• The number of farmers’ markets rose to 5,274 in 2009, up from 2,756 in 1998 and 1,755 in 1994, according to USDA’s Agricultural Marketing Service.

• In 2005, there were 1,144 community-supported agriculture organizations (CSAs) in operation, up from 400 in 2001 and 2 in 1986, according to a study by the nonprofi t, nongovernmental organization National Center for Appropriate Technology. In early 2010, estimates exceeded 1,400, but the number could be much larger.

•    The number of farm to school programs, which use local farms as food suppliers for school meals programs, increased to 2,095 in 2009, up from 400 in 2004 and 2 in the 1996-97 school year, according to the National Farm to School Network. Data from the 2005 School Nutrition and Dietary Assessment Survey, sponsored by USDA’s Food and Nutrition Service, showed that 14 percent of school districts participated in Farm to School programs, and 16 percent reported having guidelines for  purchasing locally grown produce. Production of locally marketed food is more likely to occur on small farms located in or near metropolitan counties.

Local food markets typically involve small farmers, heterogeneous products, and short supply chains in which farmers also perform marketing functions, including storage, packaging, transportation, distribution, and advertising. According to the 2007 U.S. Census of Agriculture, most farms that sell directly to consumers are small farms with less than $50,000 in total farm sales, located in urban corridors of the Northeast and the West Coast.

In 2007, direct-to-consumer sales accounted for a larger share of sales for small farms, as defi ned above, than for medium-sized farms (total farm sales of $50,000 to $499,999) and large farms (total farm sales of $500,000 or more).

Produce farms engaged in local marketing made 56 percent of total agricultural direct sales to consumers, while accounting for 26 percent of all farms engaged in direct-to-consumer marketing. Direct-to-consumer sales are higher for the farms engaged in other entrepreneurial activities, such as organic production, tourism, and customwork (planting, plowing, harvesting, etc. for others), than for other farms. In 2007, direct sales by all U.S. farms surpassed customwork to become the leading on-farm entrepreneurial activity in terms of farm household participation.

Barriers to local food-market entry and expansion include: capacity constraints for small farms and lack of distribution systems for moving local food into mainstream markets; limited research, education, and training for marketing local food; and uncertainties related to regulations that may affect local food production, such as food safety requirements.

Consumers who value high-quality foods produced with low environmental Impact are willing to pay more for locally produced food. Several studies have explored consumer preferences for locally produced food. Motives for “buying local” include perceived quality and freshness of local food and support for the local economy. Consumers who are willing to pay higher prices for locally produced foods place importance on product quality, nutritional value, methods of raising a product and those methods’effects on the environment, and support for local farmers. 

Federal, State, and local government programs increasingly support local food systems. Many existing government programs and policies support local food initiatives,  and the number of such programs is growing. Federal policies have grown over time to include the Community Food Project Grants Program,



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