- Author: Shermain Hardesty
Our University of California Cooperative Extension team measured the economic impact of local food marketing in the Sacramento Region (El Dorado, Placer, Sacramento and Yolo counties). Our key finding was that, for every dollar of sales, Sacramento Region producers engaged in direct marketing (direct marketers) are generating twice as much economic activity within the region as producers who are not involved in direct marketing (non-direct marketers). This strong economic development impact is due primarily to the fact that direct marketers source a much larger percentage of their inputs within the region (89 percent) than do non-direct marketers (45 percent).
We used an input-output modeling program, IMPLAN, to measure the direct marketers' economic impacts. Our project team interviewed over 100 direct marketers in the Sacramento Region to develop a customized IMPLAN database. We asked producers what, where, and how much they spent for inputs in various categories, as well as what, where and how much product they sold. The direct marketers were much more labor intensive; hired labor comprised 45 percent of their total expenses, compared to 25 percent of total expenses for the non-direct marketers. Additionally, most direct marketers also sold through other channels; on average, 44 percent of their revenues were generated through direct marketing, 55 percent through wholesale channels, and one percent in commodity markets.
Three levels of economic impact related to local food marketing can be measured: direct, indirect and induced. Imagine a customer goes to a farmers market in the Sacramento region and buys $10 of vegetables from Farmer Brown. There is a direct effect of 1, which generates $10 in revenue for Farmer Brown. There are also ripple effects
The second ripple effect is called the induced effect. In this example, Farmer Brown spent money to hire labor and purchase inputs. Her spending generates income for her farm, her employees, her suppliers, and the employees of her suppliers—including the sales person at the hardware store. The induced effect occurs when these households spend some of their income on products and services within the region, such as food, clothing, health care, eating out, and recreational activities. The induced effect was .45 for the direct marketers and .33 for the indirect marketers. The induced effect from Farmer Brown's production of $10 of vegetables generated $4.50 of household spending in the Sacramento Region. The direct, indirect and induced effects are added together to calculate the total output multiplier—measuring the total economic impact of one dollar of output. The total output multiplier is 1.86 for the direct marketers, and 1.42 for the non-direct marketers.
There are also large differences in the job effect of the two producer groups. The direct marketers generate 31.8 jobs in the Sacramento Region for every $1 million of output they produce. These jobs include on-farm labor, as well as jobs related to the farms' indirect effects, which involve the farms' suppliers, and jobs created by the direct marketers' induced effects involving household spending. In comparison, the Sacramento Region non-direct marketers generate 10.5 jobs for every $1 million of output. The difference is attributable mainly to two factors: (1) the direct marketers' high rate of local input sourcing; and (2) the direct marketers' labor intensiveness--hired labor expenses comprised 45 percent of their operating expenses, compared to only 25 percent for the other producers.
Readers need to be aware that these results apply only to the Sacramento Region. Gathering the data to develop a custom IMPLAN database for direct marketers is very time-consuming.
Report authors are the following current (and former) UC Cooperative Extension academics and staff: Shermain Hardesty, Libby O. Christensen, Erin McGuire, Gail Feenstra, Chuck Ingels, Jim Muck, Julia Boorinakis-Harper, Cindy Fake and Scott Oneto. The full regional report, as well as similar reports for El Dorado, Placer and Yolo counties, may be downloaded at: http://ucanr.edu/econ_impact. Inquiries may be sent to the project leader, Shermain Hardesty, email@example.com.
This article by Matt Kettman was published in the Santa Barbara Independent on October 6, 2015. UC Small Farm Advisor, Mark Gaskell, has been providing technical assistance to small-scale growers in Santa Barbara and San Luis Obispo counties for more than 20 years. Sandra Newman has established certified organic blueberries, gooseberries, mulberries, and other specialty crops on her 100 acres of sandy soil and been growing and marketing them successfully for more than a dozen years.
Blueberries, Pinot Noir, Mulberries, and More Thrive at Sandra Newman's Forbidden Fruit Farms Near Lompoc
Story by Matt Kettmann
The advisor, however, asked whether she had money and time to burn. As a widow approaching retirement age, lacking a fortune, and still paying bills through her Orange County–based digital SEC filing service, Newman had neither luxury. “I have a budget,” Newman told me during a visit this past summer to the property. “My daddy didn't buy it for me; my husband didn't buy it for me. I'm probably the only one out here who still has a mortgage.”
So the advisor suggested planting blueberries, which, if they ripened anytime other than when the blueberry market is typically flooded, would deliver nearly instant returns. In went two acres of the shrubs — they ripened exactly at the right times — and Forbidden Fruit Orchards was born. Newman was soon selling her organically grown blueberries to upscale grocers and through farmers' markets from San Francisco to Los Angeles, using the proceeds to grow her property from a few abandoned apple trees into a dynamic estate with multiple buildings.
And she kept planting, from more blueberries (now 8.5 acres) to Pakistani mulberries, avocados, apples, red and pink currants, figs, bananas, gooseberries, and more. Among the more interesting choices are the hardy kiwis (smaller than usual and hairless so that you eat the whole thing, but she's still getting them to flower at the right time), green tea (an experimental project in conjunction with the University of California), and hops for beer, which are tended to by Brian DeBolt and Casey Birthisel of Pacific Valley Hops. Many of these items will be integrated into the menu of the upcoming farm-to-table, four-course dinner at the property on November 7, when Chef Sally Ruhl will unveil many of the ingredients she's posting to Twitter under her handle @SallyRuhl.
With the blueberry cash flow, Newman finally did plant wine grapes in 2007, today amounting to 7.5 combined acres of pinot noir and chardonnay. Some grapes are sold to other vintners, but she makes about 600 or so cases in her souped-up garage under the brand Cebada, named after the canyon. The wines are very light and elegant in a deliberately Old World style; the chard is tight and racy, the pinot requires a bit of bottle age to truly shine (so 2011 is great now), and the 2014 rosé is one of the best pinks I've tried of the vintage. Plenty of others think so, too, as it's rare for me to hear so many wine lovers I know rave about the same brand without any prompting.
You can taste them with an appointment at the farm, or just head to Isabella Gourmet Foods on Figueroa Street in downtown Santa Barbara, where Cebada wines are poured upstairs and Newman's jams, teas, and other products are also sold. To get the most bang out of your $10, try them during Thursday and Friday's Classy Hour, when sips come with small food pairings from 4-6 p.m.
Newman also makes a blueberry wine, further evidence that those tiny berries remain the core strength of Forbidden Fruit Orchards. She's currently tending to bidding wars over the recent harvest, since her bushes reach their prime when the market is most desperate. “We hit a really nice window,” she said, “because Chile is not in and the northern hemisphere is done.”
It's certainly not a stress-free existence, and with so many fruits in the air, Newman admits that “sometimes you just have crazy days.” But she's happy with her 100 acres of sand and the evolving cornucopia of trees, vines, and shrubs. “I just love farming,” said Newman. “I love being able to grow and pick the fruit. It's just a passion.”
- Author: Shermain Hardesty
Pitahaya is a vining cactus that adapts very well to arid southern California micro-climates and can survive with minimal amounts of water. Its fruit is highly prized by Southeast Asian consumers not only as a fresh fruit but also for its cultural importance. However, market trends and increasing demand for new, exotic and more nutritious fruits have increased the appeal of this fruit among mainstream American consumers and the demand currently exceeds the domestic supply.
Recognizing that more research-based information and tastier, more colorful varieties were needed to increase consumer demand and to help growers capitalize on this opportunity, UCCE Small Farm Advisor Ramiro Lobo initiated a pitahaya research and extension program with seed money from the former UC Small Farm Program. Subsequent grants from UC-ANR and from the UC Hansen Trust have allowed Farm Advisor Lobo to expand the geographic scope of this program into Riverside and Ventura Counties in collaboration with Jose Fernandez de Soto, Jose Aguiar, other Advisors and Specialists from UC Davis and UC Riverside and private growers and suppliers.
Research efforts to date have focused on the evaluation of pitahaya cultivars for adaptation to local micro-climates, the genetic characterization of a pitahaya germplasm collection, pest and disease management, irrigation and fertility management and post harvest management information. This research has demonstrated that pitahaya or dragon fruit adapts very well to field grown conditions in Southern California and that this drought-tolerant plant can be a profitable crop alternative for small-scale producers in Southern Coastal California.
Pitahaya production seminar and research field days are scheduled for Ventura County on September 29, 2015 and Riverside County on September 30th
If you are interested in learning more about pitahaya, you may want to attend one of these upcoming events. The Field Day in Ventura County will begin with a tour of field research trials at MVP Farms in Fillmore, followed by
A shorter program in Indio, Riverside County will be presented on Wednesday, September 30 beginning at 10:30AM. To register for this event, contact Wendy Smith at 760 342 6437 or firstname.lastname@example.org.
- Author: Shermain Hardesty
I erroneously referred to requirements in some recently passed legislation related to direct marketing as "regulations". So I am posting an edited version of the blog. It also includes some additional information.
Recently Passed Legislation Related to Direct Marketing and Food Safety
California's Legislature recently passed several bills related to direct marketing and food safety. The California Department of Food and Agriculture (CDFA) has recently implemented some new requirements related to these bills. While these requirements could increase growers' costs, they also have the potential to foster more favorable market conditions for smaller farms engaged in direct marketing.
Some of the major provisions in these bills and their requirements are summarized below. It would be helpful for producers who direct market to review CDFA's Small Farm Food Safety Guidelines, http://www.cdfa.ca.gov/is/i_&_c/sffsg.html since they are referenced in all three pieces of legislation. Note that they are guidelines, rather than requirements. CDFA intends to revise them to be consistent with the federal Food Safety Modernization Act (FSMA) requirements, after the FDA has finalized the FSMA regulations (which I have heard could occur around October, 2015.)
Please note that this is NOT a complete listing of the requirements associated with AB 224, AB 1871 and AB 1990. I have added bold and italicized fonts to emphasize specific phrases. If you have any questions or concerns about these new regulations, please email me, Shermain Hardesty, Leader of the UC Small Farm Program, email@example.com.
AB 224 CSA Programs (Gordon—signed September 28, 2013)
- Authorized CDFA to adopt regulations establishing a registration program for CSA producers, including those supplying multi-farm CSAs
- $75 annual fee, $25 for each amendment
- Registration form is in the CSA section of: http://www.cdfa.ca.gov/is/i_&_c/cfm.html
- The form requires producers to certify the following: “…to the best of my knowledge and belief, this report is true and complete. I further certify that I am knowledgeable and intend to produce in accordance with good agricultural practices as published by the department. See
http://www.cdfa.ca.gov/is/i_&_c/cfm.html for a copy of guidelines. I am aware I must also comply with any other local, state or federal laws.”
- Required CDFA to post Small Farm Food Safety Guidelines for crops on its website as mentioned above
- Required CDFA to post Food Safety Guidelines for processed potentially hazardous foods. Such foods fall under the jurisdiction of the California Department of Public Health and local health agencies, rather than CDFA. Thus, this will require inter-departmental coordination and could require significant time because the food safety requirements for such foods vary considerably
- Imposed specific requirements related to the labeling and maintenance of consumer boxes and containers that are used in CSA programs to deliver farm products in order to facilitate traceback
- Label the consumer box or container used to deliver farm products to the consumer with the name and address of the farm delivering the box or container
- Maintain the consumer boxes or containers in a condition that prevents contamination
- Inform consumers, either by including a printed list in the consumer box or container or by delivering a list electronically to the consumer, of the farm of origin of each item in the consumer box or container
- Maintain records that document the contents and origin of all of the items included in each consumer box or container, in accordance with department regulations
- Comply with all labeling and identification requirements for shell eggs and processed foods imposed pursuant to the provisions of the Health and Safety Code, including, but not limited to, the farm's name, physical address, and telephone number
- Specified that a registered California direct marketing producer is an approved source, subject to compliance with specified provisions of the law, and that any whole uncut fruit or vegetable or unrefrigerated shell egg grown or produced in compliance with all applicable federal, state, and local laws, regulations, and food safety guidelines shall be deemed to be from an approved source
AB 1871 Certified Farmers Markets (Dickinson—signed September 26, 2014)
- Raised fee paid by Certified Farmers Markets for their vendors from 60 cents to $2 daily. Only farmers used to pay the fee, but now extended to all vendors, including food and crafts sellers in non-agricultural sections
- Required farmers to register with County Ag Dept. and pay a fee annually
- When farmers get their Certified Producers Certification for selling at Certified Farmers Markets, required them to attest that they are “knowledgeable of and intend to produce in accordance with 'good agricultural practices' (GAPs)--as outlined in CDFA's Small Farm Food Safety Guidelines mentioned above. CDFA will soon be adding a supplemental page to meet this requirement to either its online fill-in form or at the Ag Commissioner's office when producers pick up their certificates
- Required farmers selling at certified farmers markets to post a conspicuous sign or banner at their stand that identifies the farm/ranch by name, the county where the farm/ranch produces the products being offered for sale is located, and a statement that “We Grow What We Sell” or “We Raised What We Are Selling” or similar phrases that clearly represent that the farm or ranch is only selling agricultural products that they themselves have grown or raised on California land that they possess or control. Product sales by different farms at the same vendor stand shall separate the products from each farm or ranch and correspondingly post the required sign or banner in direct relationship with the sales display of the products produced by each farm.
- Authorized use of the term “California grown” and similar terms for marketing, advertising, or promotional purposes only to identify food or agricultural products that have been produced in the state or harvested in its surface or coastal waters, and made the fraudulent use of the term or a deliberately misleading or unwarranted use of the term a misdemeanor
AB 1990 Community Food Producers (Gordon—signed September 26, 2014)
- Defined “community food producers” as an approved source that includes, but is not limited to, community gardens, personal gardens, school gardens, and culinary gardens
- Unless a local jurisdiction adopts an ordinance regulating community food production or agricultural production that prohibits the activity, AB 1990 permits a community food producer or gleaner to sell or provide whole uncut fruits or vegetables, or unrefrigerated shell eggs, directly to the public, to a permitted restaurant, or a cottage food operation if the community food producer meets all of the following requirements in addition to any requirements imposed by an ordinance adopted by a local jurisdiction:
(2) Agricultural products shall be labeled with the name and address of the community food producer.
(3) Conspicuous signage shall be provided in lieu of a product label if the agricultural product is being sold by the community food producer on the site of production. The signage shall include, but not be limited to, the name and address of the community food producer.
(4) Best management practices as described in CDFA's Small Farm Food Safety Guidelines (as mentioned above), but not limited to, safe production, processing, and handling of both nonpotentially hazardous and potentially hazardous foods (see http://www.cdfa.ca.gov/is/i_&_c/sffsg.html)
(5) Egg production shall be limited to 15 dozen eggs per month.
- Permits a local city or county health enforcement office may require a community food producer or gleaner to register with the city or county and to provide specified information, including, but not limited to, their name, address, and telephone number
Please note that this is NOT a complete listing of the requirements associated with AB 224, AB 1871 or AB 1990.
- Author: Shermain Hardesty
The Food Safety Modernization Act
Comments about these revised rules are due to the FDA by December 15, 2014. If you haven't already done so, I encourage you to review the key revisions summarized on the FDA FSMA website (http://www.fda.gov/food/guidanceregulation/fsma/default.htm), as well as my comments below regarding some of the key revisions. You might also want to look at the National Sustainable Agriculture Coalition's excellent review of the FSMA: http://sustainableagriculture.net/fsma/; I reviewed their materials and borrowed some their language for this article.
You can submit your comments to the FDA at: http://www.regulations.gov/#!submitComment;D=FDA-2011-N-0921-0973 (for the Produce Rule) and http://www.regulations.gov/#!submitComment;D=FDA-2011-N-0920-1553 (for the Preventive Controls Rule).
Revised Definition of Covered Farms
However, the FSMA's $500,000 sales threshold (adjusted for inflation) for a farm to be eligible for modified requirements through a qualified exemption still relates to total farm revenues, rather than just produce sales. This cannot be changed because the text of the FSMA legislation specifically refers to “all food sales” A farm is eligible for modified requirements if it:
- has less than $500,000 in annual gross sales (adjusted for inflation) of all food products (includes commodities, hay, dairy, livestock as well as produce) over a previous three-year period AND
- sells the majority of the food directly to “qualified end-users”--consumers, restaurant and retail food establishment (e.g., a grocery store) that is located in the same state as the farm or not more than 275 miles from the farm.
Complying with the modified requirements means that a farm only needs to:
- Provide the name and complete address of the farm where the produce was grown on either a food packaging label or on a sign at the point of purchase;
- Comply with the “compliance and enforcement requirements” of the Produce Rule; and
- Be subject to the provisions regarding the withdrawal of your status as a partially covered (“qualified exempt”) operation; FDA can revoke your “qualified exempt” status in certain circumstances.
Broadened Definition of a “Farm”
Under the revised FSMA provisions, a farm that packs or holds raw agricultural products grown on another farm under a different ownership no longer has to register as a “food facility”. The original rule would have required a farm that aggregates produce from multiple farms for a CSA program to meet the Preventive Controls requirements. The revised rules will allow the farm to comply only with the Produce Rule. The “farm” may also:
- Pack or hold raw agricultural products;
- Manufacture or process food for on-farm consumption only;
- Dry/dehydrate raw agricultural products, as long as there is no additional processing; and/or label and package raw agricultural products as long as there is no additional processing.
Please be aware that the FSMA's terminology is very nuanced. Chopping or slicing fresh produce for sale – like carrots or apples – is considered to be processing, which means that you operate a “facility.” (Certain harvesting activities like trimming outer leaves of produce, or removing stems or husks, are not considered processing.). Washing is considered part of harvesting when done in the field. But, if it is done during the production of fresh-cut produce, for example, it is considered manufacturing or processing. Labeling and packaging are considered manufacturing activities unless you are labeling or packaging a raw agricultural product and are not doing any additional manufacturing or processing to the product. If there is no additional manufacturing or processing, labeling and packaging are considered farm activities and do not trigger the facility definition.
Revised Water Quality Standard and Testing Are More Flexible
For farms that have to test their water, the FDA is proposing three numerical standards below for testing.
- No detectible E. coli present per 100 ml of water: This standard would apply to water used for an activity during and after harvest, water used to make agricultural teas, and water used in sprout irrigation. The quality of untreated surface water used for these purposes must be tested from each source of the water “with an adequate frequency to provide reasonable assurances that the water meets the required standard”. You must have adequate scientific data or information to support your testing frequency.
- Farms using untreated groundwater for purposes that trigger a testing requirement will now have to test their water supply a maximum of 5 times in the first year (4 per year/growing season plus one test per year) rather than testing on a quarterly basis as originally proposed. Their untreated groundwater used to irrigate in a manner that directly contacts the harvestable portion of the crop will have to meet the following standard: a geometric mean of no more than 126 colony forming units (CFUs) per 100 ml.
- Testing of untreated surface water used for growing produce other than sprouts involving direct contact with the harvestable portion will require the collection of 20 samples over the first 2 years, followed by an annual minimum sampling of 5 per year, rather than monthly or weekly as previously required. The water will have to meet the following standard: a statistical threshold value (STV) of 410 CFUs generic E. coli per 100 ml for a single water sample, and a geometric mean of no more than 126 CFU per 100 ml. If your water testing shows that you exceed these values, you can still use your water, as long as you apply an appropriate time interval between the end of irrigation and harvest as determined by calculating the “microbial die-off”.
Clarification of Provisions on Wild Animals
Manure Application Interval Will Be Studied Further
The FDA had previously proposed a nine-month minimum time interval between the application of untreated soil amendments of animal origin (including raw manure) and harvesting. This requirement conflicted directly with the USDA National Organic Program's standards, which require a 120-day interval between the application of raw manure for crops in contact with the soil and 90 days for crops not in contact with the soil. The FDA now proposed to conduct a risk assessment and extensive research to strengthen scientific support for any future proposal. Additionally, the FDA is proposing to eliminate its previously proposed 45-day minimum application interval for compost.
Significant Compliance Costs Remain for Small-scale farms
The provisions reviewed above all were improvements over the original FSMA Produce Rule. The revised rules reduced the estimated number of farms in the United States covered by the FSMA by 4,708, of which 2,885 are “very small”. However, some of the provisions still impose disproportionately high compliance costs on smaller-scale farms, as indicated below in Table A. Smaller-scale farms typically have very constrained cash flows. The added expenses to comply with the FSMA makes their cash flows even tighter and reduces their already low level of profitability. If a "very small" farm loses over a fifth of its net cash farm income, this could have significant impacts on its sustainability. And these decreases do not include the one-time capital expenses that a farm may have to incur, such as to modify restrooms or handwashing facilities and to build fences!
The percentage decrease in net cash farm income attributable to the costs of complying with the FSMA declines as farm size increases. Clearly, there are economies of scale in complying with the FSMA. The FSMA includes delayed implementation of FSMA compliance for smaller-scale farms. Policymakers should also consider providing subsidies and/or no-interest loans for the capital expenditures smaller-scale farms need to make to comply with the FSMA.
Again, please consider submitting comments to the FDA about the proposed FSMA Produce Rule and the Preventive Controls Rule. You can post your comments using the links at the beginning of this article. You can review the FSMA's key revisions summarized on the FDA's FSMA website (http://www.fda.gov/food/guidanceregulation/fsma/default.htm). Also consider reading at least part of the National Sustainable Agriculture Coalition's excellent review of the FSMA.