What is in this article?:
- Local food market involves wide range of producers
- Marketing channel use varies
- Farm operators
- The size of the U.S. local food market was $4.8 billion in 2008.
- Local food marketing channels vary with farm size, with smaller farms dominating direct-to-consumer sales and larger farms dominating sales through grocers and other intermediaries.
Marketing channel use varies
Previous research found that direct-to-consumer sales are highest in metropolitan areas (see “Urban Areas Prove Profitable for Farmers Selling Directly to Consumers” in the September 2010 issue of Amber Waves), and this finding also holds for intermediated sales of locally grown food. While farms that reported local food sales in 2008 were more likely to be located in metropolitan counties, the rate varied among regions. The Northeast and the West Coast regions had the highest local food sales, but the regions differed with respect to the marketing channels used.
Farms with both direct-to-consumer and intermediated local food sales on the West Coast (California, Oregon, and Washington) accounted for less than 8 percent of all U.S. farms reporting local food sales but were responsible for nearly 24 percent of the value of U.S. local food sales. In 2008, 85 percent of the value of West Coast local food sales occurred through intermediated channels. The dominance of intermediated marketing channels among West Coast local food farms is likely because these farms are typically larger and located farther from metro areas than farms in other regions, necessitating the use of intermediated rather than direct-to-consumer marketing channels. High levels of local food production on the West Coast may also be related to the region’s suitability for fruit and vegetable production. Recognized for its varied climates, long growing season, and extensive irrigation networks, the West Coast produces 56 percent of the Nation’s vegetables, fruit and nuts, and other specialty crops.
In the Northeast, farms reporting local food sales tended to be smaller, located closer to densely populated urban markets, and more likely to use direct-to-consumer marketing outlets than their counterparts on the West Coast.
Vegetable, fruit, and nut farms dominate local food sales when compared with other types of farms. An examination of the factors driving spatial location differences finds that climate and topography favoring the production of fruit and vegetables, proximity to and neighboring farm participation in farmers’ markets, and good transportation and information access drive direct-to-consumer sales.