Public health concerns spur produce-market growth

November 3, 2011

Sam Shina’s family owns 14 small grocery stores in Detroit. One of them could soon be part of a market incentive experiment designed to improve public health, expand sales for Michigan farmers, and grow local economies.

Pending federal approval, Shina’s Apollo Market will become one of five independent Detroit grocery stores to test a program that uses charitable contributions to provide additional money for food stamp recipients to purchase fresh produce.  “Double Up Food Bucks” was in operation this summer at 54 Michigan farmers markets and is now looking to move into grocery stores.

Sam Shina says the purchasing-incentive program “will allow us to have more produce and more variety” to offer low-income customers. 

Sam Shina
Sam Shina believes his Apollo Market in Detroit and will benefit from a program that helps food stamp users buy more produce. Backers believe it can help Michigan farmers, too.. Photo by Patty Cantrell.

Operated by Ann Arbor-based Fair Food Network (FFN), Double Up Food Bucks is designed to increase consumer access to fruits and vegetables.  But it has the additional pump-priming aspect of sending a signal through the channels of both the marketplace and government.

Double Up Food Bucks is among many new approaches that a growing chorus of food policy stakeholders is bringing to local, state, and federal government. They contend the solution to the high cost of dietary diseases is greater access to healthy food and more marketing avenues for farms to supply it. FFN will work with other organizations in upcoming federal Farm Bill debates, for example, to make the case for Washington to do more to leverage its substantial purchasing power for public health and economic health.

Food stamp benefits are now called Supplemental Nutrition Assistance Program benefits. SNAP has an annual nationwide disbursement of $69 billion to low-income people. 

“Each year Michigan draws about $2.5 billion in SNAP benefits,” FFN president Oran Hesterman says. “We are not capturing that flow of resources for our Michigan farmers anywhere near what we could.” He views incentivizing SNAP purchases of Michigan products as a powerful way to accomplish many objectives with one dollar.

Related proposals to improve diets and build new farm marketing channels range from regional-scale food distribution hubs to more scratch cooking and nutrition education in schools. Support is showing up in local governments’ economic development planning, in Michigan Governor Rick Snyder’s agenda, and in federal Farm Bill deliberations.

Increasing demand for fresh fruits and vegetables, as well as strong consumer interest in local food are factors shaping the business plans of growers like the Thumb’s Sattelberg family. Jim Sattelberg, his wife and sons raise crops, and process organic beans and grain.

“It’s coming,” Sattelberg says of a new consumer mindset—especially among the younger generation—that will change how people eat and how farmers do business. 

The family company recently bought a new facility that will enable expansion of existing operations and provide capacity for fruit and vegetable processing. “I want it to be a place to bring vegetables and prepare and package them; I want to make that available to local growers,” he says.

Grower incentives will smooth the path to market development, he says. “We need some grant money to help develop the system and the learning process, so growers will see the value and try it.”

Support for farm business innovation is contained in proposals such as a “local and regional food system bill” that U.S. Senator Sherrod Brown (D-Ohio), U.S. Representative Chellie Pingree (D-Maine) and co-sponsors plan to introduce later this fall. The comprehensive package will include provisions to support entrepreneurship in regional food distribution; provide crop insurance for diversified farming; and address the shortage of credit, research, education, and training for new marketing approaches, as well as uncertainties related to food safety and other regulations.

Western Michigan carrot producer Jerry Malburg has already ventured in business directions that put him in good position to supply emerging local and regional markets.  Fifteen years ago, he built storage facilities that allowed him to extend fresh carrot marketing through April.

Jerry Malburg
Carrot grower Jerry Malburg of Oceana County invested 15 years ago in storage facilities so he can sell carrots through April. Now his farm is in position to sell to more Michigan customers looking for local produce year-round. Photo by Gary L. Howe.

“I found that if I stored carrots there were a lot of places out there that wanted to buy them,” he recalls.  Most have been sold to a “stick carrot” market that fills party trays between Thanksgiving and Super Bowl Sunday.

A limiting factor is competition from California’s baby carrot market. So Malburg is eager to explore opportunities to supply institutions, such as Michigan State University, which have made clear to distribution companies that Michigan and regional farm suppliers will come first.

Student interest in eating food from nearby farms is the biggest driver for MSU to source more of its $18 million annual food budget locally, said Marta Mittemaier, MSU Food Stores Manager. “On a scale of 1 to 10, it’s like 15,” she said of interest in the local purchasing initiative. “It’s very important to MSU.”

The Snyder administration is responding with policy solutions that recognize agriculture as a key to the state’s “economic reinvention." The Michigan Food Policy Council (MFPC) is a lever of influence. The foundation-funded, state-led initiative convenes a diverse set of food-related stakeholders to recommend programs and policies.

One MFPC target is 20 percent of all Michigan food purchases to come from Michigan producers and processors by 2020. To do this, the MFPC will support local food and farm policy efforts statewide, such as the southeast Michigan’s five-county Food System Economic Partnership and northwest Michigan’s six-county Food and Farming Network

Front and center in such local, state, and federal policy proposals is the need for greater access to healthy foods and how such efforts can also support Michigan farms. Gov. Snyder’s recent health and wellness address specifically mentions farm-to-school purchasing programs and Double Up Food Bucks.

The win-win potential is strong. From June through September, the opportunity to double their money, up to a total spend of $40, brought 30,000 SNAP users to farmers markets in Michigan, more than a third of them for the first time. During those four months more than $1 million (SNAP plus incentive) went directly into Michigan produce vendors’ pockets.

Michigan Asparagus Advisory Board executive director John Bakker is encouraged by Double Up Food Bucks’ planned experiment with retail stores where he says more producers could benefit.  “It could tempt folks to try asparagus who maybe otherwise would consider it outside their budget,” he says.

Turn up the Volume is a Fair Food Network project to investigate local food market potential for Michigan specialty crop producers. Patty Cantrell, Regional Food Solutions LLC, produces the series for the Fair Food Network with USDA Specialty Crop Block Grant support. See the full series on Facebook.