Farm to Plate 2.0 Strategic Plan Vermont Food System Plan Product Brief: Lightly Processed Vegetables
Vermont institutions, hunger relief organizations, restaurants, and food retailers are limited in the amount of fresh, whole Vermont produce they can purchase, due to increasing food service labor shortages and the difficulty and cost of working with seasonal, perishable, and irregularly shaped produce. To limit the loss of this market share to out-of-state producers, Vermont processing facilities have begun to sell cut and frozen locally grown vegetables, but issues of capital, infrastructure, logistics, and communication have limited their expansion potential. Collaboration between producers, processors, and buyers, substantial infrastructure investments, and policies to support producer and processor expansion are needed to encourage in-state minimal processing and continue the growing momentum of local purchasing.
Hemp is a versatile annual crop and, according to UVM research, is well adapted to Vermont’s climate. In 2018, federal laws established hemp as a regulated agricultural commodity. That year, United States hemp sales grew to $1.1 billion, dominated by cannabidiol (CBD), followed by personal care, food, and industrial products (e.g., building materials, textiles, bio-composites, etc.). From 2016-2018, the first Vermont farms and businesses that jumped in were rewarded with extraordinary prices for their high-CBD hemp. Market research shows the U.S. hemp industry will grow an estimated 19% from 2018-2022, however, as prices paid to producers continue to fluctuate, it is critical that Vermont’s hemp sector prepare for where prices are headed, look to the future, diversify, and innovate.
Retail food stores, from village markets to food cooperatives (co-ops) to national chain supermarkets, are the primary sales outlet for Vermont farm and food businesses of all sizes and scales. In 2017, Vermonters spent a total of $310 million on local food, purchasing 32% of those foods at Vermont co-ops and grocery stores.1 These stores have significant impact on Vermont’s food producers, rural communities, and economy. The current trend toward out-of-state ownership and consolidation of distributors and food stores is greatly impacting the ability of Vermont farms and food manufacturers to sell their products to stores of all sizes. The viability of independently owned businesses and regional supermarkets committed to increasing local sourcing is in turn critical to farm and food business viability. Vermont must support both growers’ and value-added producers’ ability to service grocery markets. Meeting growing consumer demand for fresh, local, high-quality products at grocery stores will advance Vermont’s rural economic development and our rural communities.
The market for beef labelled “grass-fed” has been growing quickly across the nation, from $17 million in 2012 sales to $272 million in 2016 sales.1 Adding value through a production system and/or marketing label can bring higher prices paid to the farmer, and potentially higher farm profitability overall. That said, with increased demand comes increased national and international competition as well as a heightened need to improve Vermont beef genetics and grazing management in order to create year-round quality and consistency for local and regional wholesale markets. Beef represents an exciting opportunity for young and aging farmers, whether animals are grass- or grain-finished in Vermont or sold live into larger regional outlets, but will require focused coordination in order to grow within regional markets and maximize profitability and the benefits to Vermont’s farm economy.
Vermont has driven growth in the artisanal cheese industry over the last 40 years. Today there are a dozen Vermont goat cheese brands, including the number two national brand of retail goat cheese. Due to the success of Vermont goat cheese makers, an estimated 5,000 additional milking goats could be needed in the state. In parallel to the goat dairy industry, the goat meat industry is still in development but has strong potential with both general and immigrant consumer markets. The goat industry represents a diversification opportunity for cow dairy operations, potentially contributing to keeping farms in business as well as maintaining a vibrant agriculture landscape in Vermont.
Farm to Plate 2.0 Strategic Plan Vermont Food System Plan Issue Brief: Food Access and Farm Viability
All Vermont residents should have access to nutritious local foods they can afford, and Vermont farms should all be profitable. However, many people in our state struggle with the rising cost of living, high housing and utility costs, transportation barriers, health issues, and underemployment, all of which can make it challenging to afford food. Today, 74,520 Vermonters are food insecure, including 18,760 children. To build a robust and equitable food system, we must address both food access and farm viability simultaneously. For the health and wellbeing of all eaters, food access cannot be addressed by the charitable food system alone but rather must be considered in relation to all the major market channels: retail, direct markets, and institutions. By increasing the ability of all eaters to access and use local food, we also benefit our farm businesses and the entire Vermont economy.
Consumers are concerned about where their food comes from, yet may not realize that the majority of local grain-based products (e.g., flour, bread, baked goods, beer, and spirits) are not made with locally grown grains. Local grains market opportunities are beyond direct-to-consumer, as brewers, maltsters, bakers, restaurant owners, food distributors, and others have all demonstrated interest in greater local product availability. For Vermont dairy farmers looking to diversify, growing grains is a feasible option because grains can be grown at scale, would benefit the forage rotation, are suitable for our soils and climate, and offer a diversified income stream. For farms to continue to, or transition to, growing edible grain, there needs to be additional equipment and infrastructure in Vermont for growing and processing, strong regional markets, access to capital, and research-based technical assistance.
Over a quarter of Vermont farms (1,833) sell directly to consumers through farmers markets, Community Supported Agriculture (CSA), and other “direct market” channels.1 Direct markets are critical because they allow producers to capture more income for each product sold (compared to wholesale), require low up-front investment, give producers more autonomy over the products they sell, and foster customer relationships through experiential marketing (an increasingly important tactic across all industries). The trends towards consolidation and downward price pressure in wholesale markets favor larger producers and create challenges for many small to medium-scale producers, accentuating the importance of strengthening direct markets as the foundation of a working landscape of diverse farms at all scales.
For generations, Vermont has been defined by dairy, an industry that has an economic impact of $2.2 billion annually and adds nearly $3 million in circulating cash daily. Wherever you are in the state, and whomever you meet, you are not far removed from the dairy sector, and the socio-economic impacts stretch well beyond the farm gate. Many farm families have been on the same piece of land for over 100 years and hold deep-seated knowledge and a connection to a specific place across time. As the current dairy crisis roils the industry, Vermont is rapidly losing the highest-value use of the working landscape, putting the agricultural land base at risk of permanent loss.
Consumer demand for local, organic, and specialty foods have surged over the last ten years, helping Vermont’s agricultural vitality. As these markets are maturing, slowing growth and increased competition are leading to downward price pressure and other scale-related barriers for Vermont producers. While Vermont’s food producers are renowned for high-quality products, authentic stories, and inspiring social values, it can be difficult for these businesses to develop marketing platforms and messages in order to stand out in an increasingly crowded field. Americans are exposed to 4,000-10,000 ads each day and only about 100 will successfully penetrate the “attention wall.” If Vermont producers want to earn premium pricing, they will need resources and coordination to support strategic and compelling marketing tactics that are able to penetrate the noise and attract consumers’ scarce time and attention.