As I talk to farmers across the country, regardless of what they produce or where, they all share one common challenge: how to best move product from the farm to the marketplace. This is especially crucial for small and midsize farmers who may not have enough capital to own their own trucks, their own refrigeration units, or their own warehouse space. They might not have the resources to develop sophisticated distribution routes, build effective marketing campaigns or network with regional buyers and customers.
Without infrastructure, logistical and marketing support, these producers might be growing the sweetest strawberries or raising the most tender beef, but they lack the infrastructure support to get their exceptional products to your table.
That’s why I was delighted to be in Detroit at the Making Good Food Work conference with Senator Debbie Stabenow today announcing the USDA’s most recent findings about food hubs. Food hubs are innovative business models emerging across the country specifically to provide infrastructure support to farmers. While food hubs are a nascent industry, and many operational food hubs are less than 5 years old, they are based on a time-proven business model of strategic partnerships with farmers, distributors, aggregators, buyers and others all along the supply chain. The models rely on cooperation instead of competition, and ensure that the regional small and midsize producers get access to the infrastructure they need.
An example of a food hub is Detroit’s own Eastern Market, which is buying directly from some of Michigan’s finest small and midsize producers and then distributing that same product across Detroit’s food deserts, into Detroit’s school and directly to consumers at one of the country’s oldest operating farmers markets. Cherry Capital Foods in Traverse City, Michigan is building sound distribution, aggregation and marketing services for nearly 100 producers and is creating new jobs in Northwest Michigan. Grasshopper Distribution, a farmer owned food hub, has been building a centralized distribution and aggregation service for Appalachian farmers to sell local products directly to consumers and also to regional groceries and other wholesale customers.
Eastern Market, Cherry Capital Foods and Grasshopper Distribution are just three examples of nearly 100 operating food hubs in the country. With the help of the Wallace Center at Winrock International, the National Association of Produce Market Managers, and Project for Public Spaces, the Know Your Farmer, Know Your Food Subcommittee on Food Hubs interviewed and analyzed nearly 70 of these innovative businesses. Our preliminary findings show that food hubs are creating economic opportunity and jobs in their communities, in addition to providing new market opportunities for producers. There are significant clusters of food hubs in the Midwest and Northeast. The median number of small and midsize suppliers served by an individual food hub is 40, and over 40% of existing food hubs are specifically working in food deserts to increase access to fresh, healthful and local products.
But here’s the most exciting part: nearly 40% of food hubs surveyed were started by entrepreneurial producers, non-profits, volunteer organizations, producer groups or other organizations looking to build a strong distribution and aggregation infrastructure for small and midsize producers. This demonstrates that producers are helping producers. Processors are helping processors. Distributors are helping distributors, and so forth and so on. Moreover, while the USDA has been proud to offer support to nearly 30% of the nation’s operating food hubs, we are even more excited to find that food hubs are business aware and are trying hard to become economically self -sufficient and viable on their own.
In short, food hubs are not a flash in the pan. They are incredibly innovative business models specifically addressing some of our producers’ most overwhelming challenges. This research is part of USDA’s commitment to understanding food hubs, how they serve communities and what we can do to help them succeed.
