by Tamara Scully

The number of farmers markets operating nationwide has grown exponentially since 1994, when the Agricultural Marketing Service counted 1,755 farmers markets, to 2018 when the count was 8,687. However, market growth has all but stagnated since 2016.

Farmers markets are hard work for farmers, and often don’t bring in enough of a customer base to remain viable. Some regions have too many markets competing with one another for customers and farmers. Other forces seem to be changing the marketplace for small farmers too, and getting their food into the hands of local customers – no matter the venue – is becoming increasingly difficult.

Sherry Dudas of Honeybrook Organic Farm in Pennington, NJ, has noticed changes over the past several years. Her husband, farmer Jim Kinsel, is a pioneer in the Community Supported Agriculture (CSA) model of farming and has been operating the farm since 1991. Honeybrook Organic Farm was the first of the Garden State’s CSA farms, and was once the largest certified organic CSA in the nation.

Today, nearing retirement, Kinsel and Dudas are selling two parcels of preserved farmland they own and are worried not only about finding an appropriate buyer but about the state of health of small farms in New Jersey. The farm will continue to operate on the original farmland, leased from the Watershed Institute, as well as privately owned, permanently preserved farmland, which they lease.

“We are looking to downsize the acreage we farm, as Jim’s in his 60s, I’m in my 50s, and we have no children or other family who want to take over the business,” Dudas stated. “Any employees who may have looked promising to transition the business to are much more interested in starting their own small farms and not taking over ours.”

At Honeybrook Organic Farm, CSA sales have been the farm’s primary marketing channel since its inception. While their extensive membership hit its peak of 4,000 members in 2016, those numbers are declining again this year. Alarmingly, plenty of farms in the region, once eager to establish CSAs and compete with Honeybrook’s primary customer base – a concern a mere five years ago – are now closing up shop or eliminating the CSA model.

“We know of at least four other vegetable farmers selling farmland in New Jersey due to retirement or semi-retirement. Also, most every farmer we’ve talked to about tailgate farmers market sales have been talking about how they are not as viable as they used to be for at least the past two years,” Dudas said. “CSA memberships are down, and at least some CSA programs are probably now defunct.”

In 2012, the Census of Agriculture showed that 12,617 farms reported selling products via CSA, slightly up from the 12,549 in 2007. The 2017 census should shed more light on this apparent lack of growth.

Dudas, like many other farmers, is wondering why the resurgent national interest in local food, which gained ground through grassroots efforts and numerous farm-to-fork initiatives over the last two decades, and which is arguably very much a part of mainstream cognition, isn’t translating into increasing farm gate sales.

“What is going on?” Dudas wondered. “I know that on a national level, imports are increasing, so that may be a factor. In New Jersey, there’s a plethora of agricultural organizations growing new farmers, but the energy for growing new consumers of local farm products has not been as robust.”

More farms seem to be competing for the same customers. In her experience, as CSAs tend to attract families with children, Dudas also attributes some of the decrease in CSA memberships to families aging out, along with a delay in child-bearing in today’s younger generations. She speculated that the emergence of home delivered meal kits, promoting locally-grown, natural or certified organic ingredients which are shipped in a box to the doorstep – along with recipes – for effortless meal preparation has also taken a bite out of the local farm stand.

“We’re all then sharing the same pie, but it’s cut into smaller and smaller slivers. I think all of these factors have contributed to the decline in support for CSAs and farmers markets and a related erosion of financial sustainability for farmers where direct-farm marketing is their sole vocation,” Dudas said.

Natural foods go national

The reasons behind the perceived decline in direct-market farm customers haven’t yet been well researched. But foods defined as local, or those who claim to be produced with a quality which distinguishes them from the mainstream agricultural production sector, are now found on supermarket and other mass marketers’ shelves. Yet many of those labels, capitalizing on this interest in organic farming and local food, might be misleading consumers.

Alan Lewis of Natural Grocers spoke at the recent Real Organic Project Symposium, focusing on the changes which have occurred in the organic and natural grocery sector, where small companies once thrived outside of the large corporate marketplace. Once independent natural brands are now owned by major corporations. Small independent companies, once the mainstay of this sector, have been bought out and exist primarily in name only.

Today, Lewis said, there are only two main distributors serving this marketplace, further consolidating it.

“If you think of a health foods store – Whole Foods, Natural Grocers, everybody else – you’ve got to think that everything is coming through these warehouses,” Lewis said. “These distributors want efficient, standardized, non-seasonal truckloads of product. It’s coming up from South America, from the growing valleys in California, from Mexico and the Southern United States. They don’t want anything that’s local in small quantities. They don’t want a week’s worth of carrots. It’s so much easier to hit the ‘easy’ button and bring this stuff in from California.”

Grocery stores all look alike because they are set up by the distributors, and “you really wouldn’t know what store you’re in except maybe for the private label,” he said. Small farms can’t compete for shelf space. And that shelf space isn’t only expensive – it’s in short supply.

“The barriers to entry are just overwhelming,” and except for smallest, mostly local retail operation, small producers can’t “sell to them and get your stuff on the shelf,” he explained.

Major stores capture data on all purchases. These data are fed into a system that predicts which products will be in demand the next year, and are used to choose the products to stock on the shelves. The system is “completely biased to aggregation,” and small, regional and off-brands are neglected, Lewis said.

No matter how you sell your food or value-added products, and no matter your production methods, farmers are increasingly being forced to compete on the national scale. Attempts by agribusiness corporations to make anonymous products appear to be a part of a transparent, if not “local,” food system, along with the loss of competitors in the distribution chain, has led to the commoditization of local, natural and certified organic foods.

Increasing options for consumers to purchase food which is perceived to be superior to conventional products is taking a toll and creating a climate where local food, despite its prominence in the mainstream conscious, isn’t living up to its promise to farmers. It’s no wonder that direct-market farmers are struggling to capture and hold consumer support at the farm gate.