Small Farms Program

Emerging Farm Marketing Opportunities in Skagit County

Best Western, Mt. Vernon

November 8, 2004

Marcy Ostrom

• Increasing numbers of farmers and consumers seeking alternatives to mass markets

• Rapid diversification into higher value production, distribution, and marketing channels

WA Agriculture is Changing:

Negotiating New Market Relationships

• Direct Marketing• Farm Stands/You-Pick• Farmers Markets• Community Supported Agriculture/Subscription• Institutions (schools), restaurants, retailers• Internet/mail order

• Producer Processing and Marketing Cooperatives• Adding Value

Processing and packaging Labeling—Skagit’s Own, Puget Sound Fresh, Heart of WA

• Regional, organic, fair trade, eco-labels• Branding, creating authentic farm identity

• Agri-tourism/educational farm experiences

Assessing the Extent of Marketing Alternatives in WA:

Farmer Survey

• Sample drawn from list maintained by state (WASS)

• Minimum of 10% of farms in each county

• 3,718 surveys sent out in 2002• 1,201 completed surveys• Adjusted return rate just under 50%

• Relatively representative by farm size and type in comparison with Ag. Census

• Funded by Farming and the Environment, W.K. Kellogg and USDA NRI

Direct Marketing Becoming CommonFarmer Use of Direct Marketing Methods

Vegetable Growers (N=118)

Fruit Growers

(N=332)

All Growers Skagit (N=1,166) (N=102)

Roadside Stands 46.3% 21.2% 12.2% 22%

Farmers’ Markets 35.2% 15.3% 8.2% 13.7%

U-Pick Sales 23.4% 12.9% 6.8% 9.71%

CSA 8.4% 2.1% 1.7% 2.9%

Use any of direct methods above

59.3% 29.8% 19.9% 35%

Plan to increase direct marketing

45.8% 22.6% 25.3% 40.4%

73% of Skagit Farmers Say Direct Marketing is Effective

Direct marketing is an effective way to keep farming viable in my county.

37%

18%6%4%

36%

Strongly Disagree

Somewhat Disagree

Neither Agree norDisagree

Somewhat Agree

Strongly Agree

Skagit Growers Very Interested in Trying New Marketing Strategies

Skagit County State-Wide

More Direct Marketing to Consumers 40% 25%

Diversify Products Grown on Farm 31 24

Explore Greenhouse Production 12 6

Add On-Farm Packing/Processing 15 4

Join Producers’ Co-operative 10 5

Market Directly to Stores/Restaurants/Cafeterias 15 7

Use Product Labeling (e.g. “green”) 16 6

Common Themes of New Agricultural Enterprises

• Linked to local communities and economies

• Entrepreneurial--flexible production tailored to specific local or known markets

• Diversified

• Intensive, high-value crop production per acre, net more of gross

• Knowledge/management intensive

• Environmental Stewardship

• Require strong consumer support

The Role of Consumers in New Farming

Approaches

• WA Consumer Surveys Show Recognition of Civic and Environmental Value of Agriculture• Two telephone polls of around 900 WA residents, Farming and the

Environment Group and WSU(2000, 2002)

• Respondents saw profitable family owned farms and food enterprises as important components of the local economy

• Appreciation of multi-functional nature of agriculture• Want healthy, safe, and secure food supply• Most see economic benefit to keeping farms in business• Many see environmental, wildlife, benefits• Many see aesthetic and cultural benefits

• 7 in 10 said WA Farmers are responsible environmental stewards (Farming and Env. 2000)

• Over 80% want to increase local purchasing (2002)

Current frequency of Direct Purchasing from Farmers

43%

26% 31%Twice a month or more

Never

Once a month or less

26%

Interested in more direct purchases of:

Vegetables 82%

Fruits 81%

Eggs 52%

Dairy 44%

Beef 36%

Poultry 34%

Relative Importance of Food Purchasing Criteria

Percent Rating Very Important

-20% 0% 20% 40% 60% 80% 100%

Organic

Grown Locally

Grown in Washington

Environment

Price

Appearance

Helps Local Farms

Convenience

Nutritional Value

Taste

Freshness

If locally grown foods were available, how much extra would you pay?

Not Willing to Pay More

23%

Would Pay 10% More

54%

Would Pay 25% More

21%

Would Pay 50% More

3%

Reasons for not Purchasing Food Directly from Farmers

• Convenience a bigger factor than price

• Want foods available where normally shop, eat• Grocery stores, discount stores, restaurants, cafeterias• Want farmers markets nearby in neighborhood• Want to shop at convenient times• Want easy parking

• Not always aware of available options for buying local

• A third say there are no markets/stands nearby (even though in many cases there are)

• Most (83%) are unfamiliar with CSA

• Unaware that current purchases are not local

Consumers and Farmers Favor Labeling

• 94% consumers believe food should be labeled to show origin

• 94% consumers think having a WA label would help WA farmers

• 77% farmers think that a WA label would help them

Small Farms Program Discussion Points

• A significant amount of activity and interest in direct marketing from growers and consumers

• New levels of acceptance, moving beyond a niche?

• Growth possible given high consumer and farmer interest• Need more availability—local into existing commercial and retail

channels• Health, quality, local/family farm are big selling points• Health increasing in importance, especially for children• Consumer education, branding, and labeling are key

• Only partial solutions Need distribution and processing infrastructure Important sectors left out (meats, apples, grains)

• locality and commodity specific Many farmers don’t like marketing/time intensive Will niches be saturated?

• Farmers not operating in global vs. direct markets, but rather a strategic mix.

Diversification of markets is a top farmer priority