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Cooperative venture finds place in local groceries

posted on November 3, 2000

A growing influx of capital into the organic industry has resulted in larger farms and vertical integration, trends that mirror much of conventional agriculture. Lost in the migration toward larger scales of operation are many of the small farms and processors that pioneered the American organic industry.

That distinction at one time assured consumers that the food that they bought was not only likely to be produced free of synthetic chemicals, but also grown on family farms. Today, many of those same farmers, as well as their non-organic brethren, are seeking a way to realize market value from the beneficial farming practices they employ.

On the West Coast, a group of retailers and farmers thinks the answer lies in a new label. Sid Sprecher reports.

Cooperative venture finds place in local groceries Situated in the Valley that lies between Mount Hood and the Columbia River, the Wells family still harvests the bounty of a fruit orchard that was homesteaded by the family in 1893. But consolidation of large food chains that now source fruit from literally around the world has squeezed the Wells and many of their Hood River neighbors from even nearby grocery stores.

Gary Wells was one of the earliest members of the Food Alliance, a Portland based effort to connect farmers and consumers. The goal of the organization is to affix a label to food the group could verify was produced by local farmers through environmentally and socially sustainable practices.

One of the first retailers to sign on was a group of independent Thritfway groceries in Portland. At this store about 35 percent of the produce comes from the Food Alliance's 55 members in the northwest. The alliance is also launching a Midwest effort.

The store's produce Manager, Paul Widerburg vigorously promotes the label and frequently brings in the farmers to meet the consumers face to face.

Paul Widerburg: "... And, they've cut their product and had people taste them and people are tasting the apples from the farmer that grew those apples and customers rally like that. And they get to know these farmers and respect them and educating the customers is the harde3st thing in the world to do and the Food Alliance makes it very, very easy."

Marketing under the Food Alliance label the farmers pay fees of one-eighth to ΒΌ percent of the gross sales made under the label. Retailers also pay a flat fee per store that by agreement with the alliance is not disclosed.

But to be eligible farm members must document farming practices that are not only environmentally sound, but also socially responsible. And, that means says Food Alliance spokesperson Deborah Kane, opening the farm ledgers.

Deborah Kane: " The application process involves both a written application and then a site inspection by an independent, third party. Once we receive the written application, we will schedule a site visit to the farm. We sit down at the kitchen table with the farm family and we say, "will you answer this question in this manner?" Why don't you show us the spray records?" Why don't you show us you payroll records? Your receipts, so that we can verify that in fact what we heard about in the written application is indeed the case."

Typically Farm Alliance members are not organic, but the hope is the certification process along with the label, as well as their frequent presence in stores will assure consumers they are responsible stewards.

However, even supporters of local farms employing sustainable practices have concerns about the effectiveness of the Alliance label.

Jeff Fairchild, produce manager of Portland's newly launched New Seasons Markets is concerned that unlike "organic" the alliance label doesn't have a consistently accepted definition. He worries the broader message of social performance won't reach the consumer.

Jeff Fairchild: It's really a challenge to get someone to want to come in and learn, to put a piece of point of sale material and "Thais is what we are." A lot of the staff doesn't even read the stuff, so to give the market a new label is extremely challenging. I think where it has been successful is when they pick a particular cause."

But, Paul Widerburg insist that tin the marketplace "local" effectively trumps regulatory definition.

Paul Widerburg: "I can come over here and say, "this is farmer so and so and his family. They're the ones that grew those muskmelons or they're the ones that grew those cabbages for you and. It's an easy sell."

Slug: wells at fruit stand

If the alliance has a market advantage it is the fact its members are anxious to connect with consumers. Indeed, many like Gary Wells operate roadside stands. But, in recent years they have seen their access to markets shrink because of the heavy volume demands and centralized procurement practices of large chains and food brokers. They see the Food Alliance as perhaps their best long-term financial hope.

Wells: "When the Food Alliance came into the picture, it seemed like a logical step for us to work with them to provide an accountability for the consumers of our product. And they could recognize the value that we were building into our product and perhaps compensate us for the additional expense and inputs that we incurred. "

Not incidentally the alliance label offers the independent grocer financial incentives as well.

Widerburg: "By going to the local farmer, I have been able to lower the cost to the customer. Because the farmer sells it to me at a better price and it's helped me in my pricing range and given me the opportunity to sell a lot more product at a lot less price. And the customer has come in more."

In addition to expanding its effort into the Midwest, the Food Alliance is now taking applications from livestock producers.

Kathy Panner is one of the partners in the small Southern Oregon Umpqua Valley Lamb cooperative. The cooperative was first formed to enter the natural foods markets via a regional natural foods store chain. The stores were bought and the new owner's centralized procurement policies effectively dismissed Umpqua Valley lamb.

Slug Meat cutting

Since then the co-op's lambs have found a home through the launch of Portland's New Seasons Markets.

Panner hopes the Food Alliance label will help the co-op extend its reach.

Kathy Panner: " Making the connection to the consumer is really important to me. I've become pretty selective about what I eat. And by and large I think us, agriculture does a great job. But there are some things that I'm not comfortable with and I feel like the food that comes form this farm, people can be excited about. "

The Alliance farm and retail membership continues to grow, and with it the hope that farmers will be rewarded for their farm and civic stewardship and regain access to markets that prevailing economic trends have been denying them.

Gary Wells: "It's been difficult to measure a premium in terms of price per pound increase. What we have seen is we have seen an expansion of our market base. It, the doors have opened where we have more demand for our product within the uh, Food Alliance program and we're hoping that will translate into uh, better returns."

For Market to Market, I'm Sid Sprecher.

Tags: agriculture co-op food groceries news organic