New Report Shows Local Food Economy Continues to Expand in Iowa

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Posted: Monday, November 24, 2014 9:40 pm

AMES, Iowa -- Iowa’s local food economy is growing more vigorously than expected, according to a two-year evaluation from the Leopold Center for Sustainable Agriculture. The report also shows how modest public investment in the work of local food coordinators contributes to job creation in the state.

Sales of local food to grocery stores, restaurants, residential food service operations, food hubs, food auctions and other high-volume markets rose from $8.9 million in 2012 to $13.1 million in 2013, for a total of more than $22 million over the two-year period. The report cites data showing that these larger markets are rapidly eclipsing direct-to-consumer sales at farmers markets and from Community Supported Agriculture.

All this activity spells good economic news for rural communities and farm-based businesses in Iowa, including the creation of 171 new jobs in 2012 and 2013.

The findings are part of an evaluation of the Regional Food Systems Working Group, a statewide network that connects 15 local food coordinators working in 91 of Iowa’s 99 counties. Like last year, the coordinators recruited local food producers and buyers from their respective regions to complete a survey that measured four indicators of economic change:

  • Local food sales by farmers, including directly to consumers and to institutions and other markets,
  • Local food purchases by grocery stores, restaurants and buyers for institutions and other high-volume markets,
  • Job creation as a result of local food production, processing or utilization, and
  • Funds leveraged by RFSWG groups.

“Farmers reported increases in their sales from 2012 to 2013, even adjusted for inflation,” said Corry Bregendahl, who coordinated the data collection project for the Leopold Center with Leopold Center program assistant Arlene Enderton. “Total sales of local food, as reported by 103 farmers in 2012 and 120 farmers in 2013, nearly topped $24 million.”

Those totals offer a broader picture of the local food boom than that shown in data collected by the U.S. Census of Agriculture, Bregendahl said. The federal farm census tracks only sales directly to consumers such as at farmers markets, farm stands and CSA enterprises. Farmers are not asked to report sales to restaurants, grocery stores and other retailers, or to institutions such as schools, hospitals and residential living facilities. In the 2012 U.S. Census of Agriculture, 2,954 Iowa farms reported $17.5 million in direct sales.

“Using our 2013 data, we captured 74 percent of the 2012 Census of Agriculture local food sales with only 4 percent of the sample size,” Bregendahl explained. “Our data suggests that only a small portion of our farmers’ local food sales, about 5 percent, was sold directly to consumers. Iowa local food sales could be exceeding $300 million instead of the $17 million reported in the 2012 Census of Agriculture, if we had a better system in place for tracking sales to high-volume buyers such as grocery stores, restaurants, school food service, food distributors, and others.”

Food producers were asked to share information about existing jobs on their farms as well any new jobs created as a result of local food production. Similarly, local food buyers were asked if any new jobs had been created in their businesses as a result of local food purchases.

In 2013 118 new jobs were created on farms and by local food buyers. Combined with 53 new jobs reported in 2012, the two-year total is 171 new jobs, of which more than one-third are full-time. These new jobs were created on the farm, in sales and marketing, processing, distribution, nutrition education, horticultural education, and culinary arts, among others. When compared to other sectors, the public cost creating one new full-time job in the local foods sector is low, at $15,661.

“This is a very modest public investment, especially when you look at the cost of recruiting low-paying retail jobs from outside the state,” said Bregendahl. “A wiser investment approach to creating jobs in Iowa is to grow our own in the local foods sector. These local food coordinators are showing that they can do that.”

In addition to economic benefits and job creation, Bregendahl said coordinators in the RFSWG network raised more than $1.5 million during the two-year period, from government and philanthropic grants, donations, fundraisers and voter-approved County Extension funds. A significant portion of those funds came from outside the state.

SOURCE: Leopold Center for Sustainable Agriculture

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