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Planning to Increase Market Efficiency: Reducing Financial Risk Through Food Hubs

Two food hubs will present their very different methods for doing production planning. We also hear from a farmer to share her perspective - what is it like to cede some of the decision making for what to plant to your buyer?

Description

One benefit producers find working with food hubs is the long-term, transparent relationship characteristic of a value chain. Transparency can increase market efficiency by making an effort to find that inscrutable balance between supply and demand. The key to that process is production planning. A food hub has the valuable position of being in the middle of the transaction, so they have an understanding of what the buyers want, and the adjustments that producers can reasonably make to meet that demand.

Two food hubs will present their very different methods for doing production planning. We also hear from a farmer to share her perspective - what is it like to cede some of the decision making for what to plant to your buyer?

 

Recording

 

Presentation Slides

Download the slides (PDF)

 

Questions and Answers

Q: Please explain cool bot size, is it on skids and can be picked up and moved farm to farm? And average cost of total package please.

A: Cool bots are small, electronic units that are wired into an air conditioning unit that allows it to cool down to 40 degrees -- about $300 (plus the air conditioner and insulated room).

Here is link to plans from N.C. State University for a cool bot trailer:http://plantsforhumanhealth.ncsu.edu/2012/08/17/%E2%80%9Cpack-%E2%80%98n-cool%E2%80%9D-provides-farmers-with-mobile-refrigeration-solution/

Q: Tamara said that the food hub provided then with a cool bot for vegetable storage.  Who paid for that?

A: ASD owns the cool bot and the cooler -- Tamara has access to it, but it is a part of our (ASD) owned infrastructure

Q: Do you ask growers to grow specific varieties? Do you specify where to buy seeds?

A: Yes -- produce from different growers has to look and act the same, so coordinating varieties is essential -- we help growers find sources for our recommended varieties

Q: Is the Local Food Hub profitable?

A: Not yet.  It is a volume business we are on track to be profitable at least in the distribution arm of the organization when we get to 1.5 million in sales

Q: What kind of support does the cooperative provide  for season extension?

A: Educational support, connecting growers with the NRCS hoophouse program and bulk buying of hoophouse parts as appropriate and possible. Grants could potentially provide funding for hoop houses -- we haven't done that yet.

Q: Can certified naturally grown status replace the certified organic for your buyers?

A: No -- they are not that open minded

Q: What month/date do they have the planning meeting?

A: As early as possible -- December would be great to allow growers time to order seeds, materials, etc.

Q: How long can you hold tomatoes from getting too cold in a cooler with the insulated blankets shown?

A: Tamara delivered to the cooler on the day of pick-up, so it was rarely more than a few hours.

Q: Is Appalachian Harvest a non-profit, paid for by the growers, or funded by produce sales?

A: It is funded by produce sales and by grants secured by Appalachian Sustainable Development.

Q: Do the farmers that grow for Appalachian Harvest pay to be a member or sign an agreement to participate with your growers collective?

A: Growers "pay" 20% of the sale price of their produce to Appalachian Harvest to cover marketing and transportation -- growers purchase boxes and labels

Q: How many paid staff are involved in Appalachian Harvest? How many volunteers?

A: 4 full time staff -- marketer, packinghouse manager, grower coordinator and education coordinator -- no volunteers as such, but a slew of part time and full time seasonal workers.

Q: Is Appalachian Harvest set up as a co-op or non-profit?  Curious about the business structure when Tom says "wholesale network for organic farmers".

A: We are a non-profit organization running a (hopefully someday) for profit business. Any profit we may someday realize would be put back into the non-profit org

Q: When do you "stop" enlisting new growers…before first planning?

A: No, well into the spring. But the later you get started, the more limited your options are.

Q: Was the infrastructure purchased by grants and foundations for the Local Food Hub?

A: Yes -- primarily the VA Tobacco Indemnification Funds. Boxes, labels and smaller items are often purchased through produce sales.

Presenter Bios

Alan Moore

Alan MooreAlan Moore is the Director of Distribution for the Local Food Hub.  Alan is a founding member of Local Food Hub and brings considerable experience in promoting and strengthening the business components of local food systems.  Born and raised in tidewater Virginia, Alan and his young family have deep roots in Central Virginia. After graduating from UVA, he served as the director of operations for Jefferson Vineyards. He then moved to Charleston, SC to attend graduate school, after which he helped found and served as the Sustainable Agriculture program director for Lowcountry Local First, a nonprofit organization working to revitalize the agricultural economy, environment, and community in South Carolina. He has experience in both non-profit and for-profit organizations as well as working with farmers, businesses, community organizations, and state agencies.  He understands the many pressures faced by our local growers and has expertise in cultivating new markets for local food.

Tamala McNaughton

Tamala McNaughtonTamara McNaughton is co-owner operator of TNT Farm and Greenhouse in Meadowview Virginia.  In 1997 she apprenticed on her first 25 acre organic farm and has woven together a career in agricultural production, education, and community development ever since.  McNaughton holds a Master of Arts in Appalachian Studies/Sustainable Development.  Her work includes establishing three small agricultural non-profit organizations; coordinating logistics to bring groups of farmers throughout the Southeast region to the Southern SAWG conference; consulting for greenhouse and nursery management; and managing operations in greenhouse, nursery, aquaponic, and field production.

Tom Peterson

Tom PetersonTom Peterson is the Agriculture Education Coordinator for Appalachian Sustainable Development (ASD) – a regional not-for-profit organization that seeks to strengthen and diversify the rural economy in southwest Virginia and east Tennessee. He works to support the Appalachian Harvest network (a group of over 60 organic farmers in the area who collectively sell fresh produce to supermarkets throughout the southeast U.S.), regional farmers markets, and others interested in sustainable agriculture through developing workshops and farm tours and offering personal farm consultations. Tom is a founding member and coordinator of the Appalachian Farmers Market Association.

Tom has a B.A. in Geology from the University of Tennessee, Knoxville. He and his wife Denise (and their boys Kaleb and Mason – 16 year-old twins) also farm a 1 acre market garden (Blue Door Garden) growing cut flowers, vegetables and herbs for the Abingdon Farmers Market, local restaurants and C.S.A subscriptions in Kingsport, TN and Bristol, VA.

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