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From the Field: Food Hubs Open Markets for Local Foods

The Farm Credit System’s commitment to young, beginning and small farmers in all types of agriculture was on full display at last week’s National Good Food Network's NGFN 2014 Food Hub Collaboration Conference in Raleigh, NC. The event brought farmers, investors, buyers and community leaders together around the growing business of regional food hubs. With more than 250 food hubs around the country, these aggregators of products from small farms bridge the wholesale gap between local food producers and larger buyers.

A new Wallace Center report Food Hubs: Solving Local was featured at the spring conference, and highlights that grocery and food service companies nationwide are finding that the best way to meet consumer demand for local food is by teaming up with regional food hubs.

Solving Local presents five case studies that demonstrate how food retailers and distributors team up with regional food hubs to get smaller farms’ products into larger scale supply chains. The examples also show how food hubs help buyers satisfy demand embedded in “local” for economic, social, and environmental returns to farmers and their communities.

Like Farm Credit, food industry buyers are interested in this new intermediary, the regional food hub. One is the Food Marketing Institute, a national trade group representing nearly 40,000 retail food stores and 25,000 pharmacies. Mark Baum, FMI’s senior vice president and chief collaboration officer says, “The retail industry recognizes the broad consumer shift towards fresher foods. We also know that meeting this demand means addressing the challenge of how to pull consistent volumes of safe, locally sourced products through the supply chain. FMI looks forward to exploring how regional food hubs can help our members implement economically viable solutions.”

Back in North Carolina, food hubs are making a difference. Grocery shoppers can now buy products that used to be available only at venues like farmers markets. Regional grocery chain Lowe’s Foods now works with food hubs to source fresh produce and meats from more than 100 small farms in the state. University-based North Carolina Growing Together facilitates the initiative. NCGT program coordinator Rebecca Dunning explains, “Our angle is to connect small and mid-sized growers into conventional and mainstream food procurement and distribution systems, where 97% of food is purchased.”

Other conference highlights included sessions from Farm Credit East business consultants Erin Pirro and Tom Cosgrove, along with my roles as presenter, panel moderator, and curbside consultant. Also at the conference were Joe Deufel from AgStar and Jeremy Lee from Carolina Farm Credit.

Wednesday’s luncheon and keynote speaker was Farm Credit Administration Chair Dr. Jill Long Thompson. As the head regulator of Farm Credit System institutions, Dr. Long Thompson applauded Farm Credit East and MidAtlantic Farm Credit, two Farm Credit Associations that have made notable efforts to serve food hubs in their territories.

The Farm Credit Council is an active member of the NGFN, a peer-to-peer network of regional food practitioners, supporters, and food hub developers from across the country. Farm Credit works with NGFN, through the Wallace Center at Winrock International, on developing the financial benchmarks and other business underpinnings needed to make retail agriculture work for the many producers engaged or interested in it.

At the conference Farm Credit and NGFN solicited participants for their second annual food hub financial benchmarking study. The study's purpose is to help food hubs dig into the economic fundamentals of these local food system aggregation and distribution businesses. The draft 2013 Food Hub Benchmarking Report can be found here.