Growing Cash

What can be done to make farms profitable?

By Cheetah Haysom

Without stable, steady and profitable markets, the risks associated with farming, especially in the face of climate change, could make the Hudson Valley’s 900,000 acres of farmland the riskiest casino in the state.

According to one estimate, after taxes farmers take home about six cents on every dollar spent on the food they grow. With such low margins, profitable markets are crucial for the survival of farming.

Some analysts say there is plenty of room for growth. New Venture Advisors, a food business consulting firm based in Chicago, calculates the Hudson Valley could produce and sell $1 billion more in food than it does now.

Farmers markets

Farmers markets, for more than a decade the staple outlet to sell produce in our region, have seen a drop in customers and sales.

No one is sure why, but the market may just be tapped out. Over the past two decades, the number of markets in the state has grown from 235 to more than 700 at the same time that fewer customers are using them. Sales are down throughout the region, says Diane Eggert, executive director of the Farmers Market Federation of New York.

The federation, along with its counterparts in Vermont, Massachusetts and Maryland, recently received a federal grant to study the causes for the decline. A team from Cornell University is helping conduct the research.

Liz Higgins, a specialist in business management at the Hudson Valley Lab of the Cornell Cooperative Extension in Highland, noted that farmers markets have suffered because of changes in the larger food industry.

Among those changes is the growth of ready-made meal kits, prepared foods at supermarkets and Amazon’s offer of free two-hour delivery through Whole Foods. In an effort to attract customers, some farmers markets in the Hudson Valley have started opening year-round, changed the day of the week they are open, or added more products.

The state of CSAs

Liz Corio, vice president of development and administration at Glynwood, a nonprofit based in Cold Spring that promotes food and farming in the Hudson Valley, says there is a growing focus on how to widen the appeal of Community Supported Agriculture (CSA), in which consumers buy directly from farmers by paying up front for a season’s worth of food.

This widely used program helps farmers, especially cash-squeezed farmers (and, particularly, beginning farmers), pay the high costs of starting a growing season.  But finding CSA customers is getting harder and the market might also be saturated. Some farms doing CSA this summer reported being undersubscribed.

Megan Larmer, director of regional food programs at Glynwood, says the CSA model, which originated in Japan and was introduced to the U.S. in Wisconsin in the 1970s, needs to adapt, and customers need to be made aware of the range of CSAs available, including meat, dairy, vegetables, flowers and half shares for smaller households.

One innovation similar to the CSA model is Field Goods, a distribution company based in Athens, New York, that delivers food collected from at least 60 small farms (everything from produce to jams, cheese and farm-made foods) in eastern New York, northern New Jersey and western Connecticut.

Positioned on the Hudson River, Field Goods was started in 2011 by Donna Williams, an agricultural consultant who wanted to find a way to expand farming in Greene County. Her colorful vans now deliver bags of food to more than 700 public and private pick-up sites, including in Beacon.

The Corn in Your Gas
By Brian PJ Cronin

There’s corn in your gas tank. And if the federal government gets its wish, there’s going to be more of it.

Gasoline won that battle, but today almost all the gas you buy at the pump, including anywhere in the Highlands, is still 10 percent ethanol, a blend known as E10. That’s because of amendments made in the 1990s to the Clean Air Act that required gasoline to be mixed with something (aka “oxygenated”) to make it burn cleaner. After the first oxygenate, a chemical compound known as MTBE, started showing up in drinking water, the industry switched to ethanol.

Corn is a major field crop in New York State, with more than 1 million acres planted annually. About 20 percent of the 100 million bushels produced in the state are converted to ethanol at a plant near Albany, according to Sunoco, which runs it.

From an environmental perspective, there’s a lot about ethanol that makes sense. It produces fewer emissions than gasoline, and it’s made from a renewable resource that removes carbon from the air as it grows. In a nod to help struggling farmers, President Donald Trump has said he will push the Environmental Protection Agency to allow gas blended with 15 percent ethanol (E15) to become the standard.

That announcement made both oil companies and environmental groups nervous. Corn may be renewable but its dominance in U.S. agriculture has been disastrous for the long-term health of topsoil and waterways. Corn is typically grown as an “industrial monocrop,” which causes excess phosphorus and nitrogen runoff, leading to the increase of toxic algae blooms and the ever-growing “dead zones” in the Gulf of Mexico and Lake Erie.

Gas blended with ethanol, despite burning cleaner, also produces a higher concentration of ozone-destroying emissions in the hotter summer months. That’s why, although E15 is available at many fueling stations in the winter, the EPA prohibits it from being sold during the summer, which the Trump administration said it would like to allow.

Agritourism

The price of stands at New York’s greenmarkets, as well as the costs of trucking, including pre-dawn labor and bridge tolls, has pushed many farmers to look for alternatives.

As the popularity of local food and farm-to-fork has grown, so has the appeal of “agritourism,” or visiting a farm for fun. Many farms, helped by the Hudson Valley Agribusiness Development Corp., have boosted profits by creating farm stands, pick-your-own and on-site dining.

Local wholesale

A few years ago, GrowNYC, the nonprofit that runs the greenmarkets program in New York, realized there was a need for a major wholesale market for locally grown produce to supply urban restaurants and fresh food outlets. It set up shop at Hunts Point, in the Bronx, one of the largest food distribution centers in the world. The market has traditionally been the wholesale point for produce for everywhere else — that is, the 49 other states and 55 foreign countries.

GrowNYC now runs a large wholesale section for local food where restaurants and other businesses can buy produce supplied by farmers throughout the region. It’s become a major new market for the farming world and prompted the state to invest $20 million to build a 120,000-square-foot market next year.

Feeding institutions

The American Farmland Trust created a program to entice institutions across New York state, including schools, colleges, senior centers and hospitals, to purchase food from local farms. It’s potentially a huge market. By one estimate, publicly-funded institutions spend nearly $1 billion on food to feed more than 6 million people through public institutions, including 1.6 million schoolchildren.

Most of the food destined for these institutions grown in the Hudson Valley is distributed at Hunts Points. This year, for the first time, the state will allow public schools that purchase at least 30 percent of their lunch ingredients from New York farms to receive a reimbursement of 25 cents per meal.