Final Report for GNE12-041
Extension and grass-roots efforts across the state of West Virginia are working to grow local markets to meet increasing demand for local foods by recruiting producers to become new vendors as well as by facilitating expansion of active vendors. Depending on how the goals and needs of non-participating producers differ from those of more actively marketing producers, different strategies may be needed to facilitate their participation and success. This study provides Extension and development professionals with desired information regarding the factors that limit or enable producers’ decisions to participate in and generate income through unique local food markets. Data were collected using a mail and internet questionnaire that was sent to a list of 1705 producers throughout West Virginia developed through collaboration with field professionals such as Extension Agents and market managers; 574 producers returned their survey for a response rate of 38%. Survey data were analyzed using quantitative econometric analysis such as probit models and linear regression.
Key factors were identified that limit producers from entering commercial production, including concerns about food safety, distance to market and time constraints, and perceptions of profitability. Female producers, producers who plan to pass the farm on to a successor, and producers with access to irrigation water were likely to expand production. Results illustrate the potential for development efforts focused on reducing the time and distance constraints, empowering producers to address food safety concerns and other regulations, supporting female farmers, and facilitating farm transition to be effective in encouraging producers to enter into and expand commercial production. The information and recommendations generated through this study can be used by field professionals and development practitioners to design activities to address limitations.
The purpose of this project was to provide information to Extension and other development professionals regarding the factors that are enabling or limiting the ability of West Virginia (WV) producers to meet increasing demand for local food in order to inform the design of interventions targeted to facilitate rural income generation.
Demand for locally-produced foods in the state has increased in the last few years, offering new or increased income opportunities for small producers and spurring increased rural development work focused on local food system development. The number of farmers selling directly to consumers increased by 58% between 1992 and 2007 nationwide, with dollar sales of local direct-marketed local food increasing by 215% (ERS, 2011). WV is no exception to this trend, where the number of farmers markets have doubled in the past 10 years (Hartz, et al., 2012) and numerous new mechanisms are in place to connect producers to consumers such as the WV Farm2U website and the growing WV Farmers Market Association. Recently, Extension, the new WV Food and Farm Coalition, and other grassroots efforts have focused on increasing the capacity of farmers to take advantage of new market opportunities through investments in food safety, best practices, and season extension training and technology.
Hartz et al. (2012) confirmed that the state’s agricultural land can support the production of enough vegetables to satisfy state consumption levels, and showed that if WV could increase its vegetable and fruit production to meet 75% of the seasonal demand for these products, an additional $93.9 million dollars in sales could be generated along with 1300 jobs. However, the study does not attempt to discern where this increased supply (over 5000 new acres in production) would come from, and recognizes that the supply would have to come from either current farmers increasing their acreage in production or the entrance of new farmers to local markets. Understanding farmer supply response is a critical and logical next step in understanding the true potential impact of local food system development. This study therefore seeks to answer the following questions: Who are the farmers in WV that are likely to grow in or enter local food markets? What are the factors that enable or limit their success? How much are they likely to expand?
Given a situation where demand exceeds supply, it is natural to assume that farmers will certainly move to increase supply. Yet past research has shown that farmers’ expansion decisions are based on a complex set of non-economic (as well as economic) factors, including farm goals, motivation for entering farming, farmer life-phase, and farm-level characteristics. This study hypothesized that West Virginia farmers’ expansion or diversification decisions are related to a unique variety of factors related to scale, motivation, and culture and therefore merit special consideration. For instance, the majority of WV farms are small – 80% of WV farms sell less than $10,000 annually (ERS, 2007) – and they produce significantly less vegetables per thousand people than surrounding states (USDA 2007 in Hartz et al., 2012). Also, farmers in the region have traditionally diversified their risk and income streams as part of their complex “rural livelihood strategies” (LaLone, 2010). The prevalence of a culture focused largely on risk minimization and diversification of economic activities may influence the extent to which WV farmers are likely to change their farm operations to take advantage of perceived but uncertain opportunity in the local food system. The extent to which development or extension interventions succeed in assisting farmers to take advantage of market opportunities hinges largely on their efficacy in addressing these multiple factors that motivate and influence farmers’ decisions.
1. Provide information to Extension and development professionals to help improve targeting and efficacy of interventions designed to facilitate producer income generation in local food markets.
1.1. Gather information about factors such as goals, perceived limitations, and regional characteristics that influence producers’ decisions to enter and expand in local food markets via focus groups and a survey.
This objective was completed via implementation of a survey questionnaire and analysis of results using statistical econometric methods. Further information was gathered via focus groups with producer groups and key stakeholder groups such as the WV Farmers Market Association that contributed to interpretation and presentation of results.
1.2. Determine the factors that facilitate or limit producer decisions and ability to enter and expand in local food markets.
This objective was also accomplished through the use of the survey questionnaire and focus groups.
1.3. Generate participatory recommendations for Extension and development professionals about how to address producer goals, perceived limitations, and regional factors in order to improve success of interventions designed to facilitate producers’ participation, expansion, and successful income generation in local food markets.
This objective was completed. Recommendations regarding how to address factors that limit producers from entering or expanding in commercial production were generated with input from WVU Extension professionals, local producer groups, and board members of the WV Farmers Market Association. The recommendations are presented in Part IV of the final outreach document that is targeted to field professionals and practitioners.
2. Contribute information to practitioner and academic literature regarding the implications of producer supply response for the magnitude and nature of local food system development in West Virginia and Appalachia.
2.1. Develop report and summaries with results, recommendations, and implications for local food system and market development in WV and Appalachia.
An outreach document was completed that includes this information. It was possible to predict where growth might occur in terms of new entrants to commercial production. However, this study was unable to generate reliable predictions of impact of magnitude of local food system growth in terms of expanded production. The survey questionnaire asked producers about how much they intended to scale up production over the next two years. While most producers answered the question regarding their level of production of various products in 2012, many producers did not respond to the question regarding their projected level of production in 2014. Therefore, it was difficult to generate predictions of increased production of different products at an aggregate level. Although this type of production projection would have been valuable to see where producers see opportunity to expand their production, this issue of non-response contains a valuable lesson as well. This suggests that many producers may not be thinking very far into the future or planning for their farm growth or operation. This may reflect another layer of the complex attitudes towards farming as a business or lifestyle that were illustrated through other aspects of the study.
2.2. Disseminate report via Extension forums, scholarly publication, and conference presentations.
Key outreach presentations were conducted over the final phase of this project in spring of 2014. Drafts of the outreach document and presentations were vetted with stakeholder groups and field professionals. The final outreach document is being distributed to various agencies and projects that implement development work surrounding food and farming in WV including the WVU Extension service, the WV Department of Agriculture, the WV Food and Farm Coalition, the WV Farmers Market Association, the Appalachian Foodshed Project, the Value Chain Cluster Initiative, and other stakeholder groups.
Initial findings were presented at the annual conference of the Northeast Agricultural and Resource Economics Association (NAREA) held in June of 2013 in Ithaca, New York. A manuscript of the completed study will be submitted to an appropriate journal (such as Agricultural and Resource Economics Review) during the summer of 2014.
This study sought to generate information from producers associated with WV markets in order to determine the factors that limit or enable their participation in and expansion of commercial agricultural production. The use of a mail and internet survey was selected as the appropriate method to obtain the volume and breadth of responses needed to conduct this type of state-level analysis.
The study team enlisted the help of key field professionals that work with the target population of producers. This group, including WVU Extension agents and specialists as well as farmers market managers, contributed contact information of producers to survey via mail or internet. Many also assisted by directly implementing the survey questionnaire with their local producers. Overall, 1705 survey questionnaires were sent out and a total of 1511 were received and not returned to sender. A 38% response rate was achieved, as a total of 574 survey questionnaires were completed and therefore useable for study analysis. A copy of the survey questionnaire with aggregate survey results included is available (see attached document). Survey data was then analyzed using econometric statistical analysis to determine which factors signficantly influence the following outcomes related to increased supply: the likelihood a producer will sell products, the likelihood a producer will intend to sell in the future, and the likelihood that a producer desires to expand their production.
Other methods employed included the use of focus groups. A focus group with a group of producers was used to pilot and improve the quality of the survey questionnaire. Additionally, this study employed a strategy to develop participatory recommendations to include in the final outreach document. This entailed holding focus groups with a local producer association and the WV Farmers Market Association board of directors in order to gain feedback on the study results and implications from these key stakeholder groups. Their reactions and recommendations of potential strategies to address limitations identified by the study were incorporated into the final outreach document.
The project identified several key factors that may limit producers from deciding to enter into commercial production. Of the factors that were found to be significant, several are contextual and could be addressed through potential training or technical assistance efforts. For example, helping producers overcome concerns about food safety and complicated regulations could encourage greater commercial production. Other factors may be tied to societal and cultural norms and beliefs and could require creative efforts to overcome. For example, producers who had ancestors that farmed were less likely to sell products they produced. Additionally, complex attitudes towards farming as a business were found despite the fact that many producers indicated that they farm with the goal of earning income. A summary of the variables that were found to impact market participation, sales, and expansion decisions is available in the table below. A positive sign indicates that the factor increases the likelihood that a producer will make that decision; a negative sign indicates that the factor has a negative influence on the likelihood that the producer will make that decision.
The following presents key results and implications. More information regarding specific summary statistics and results are available in the outreach document that is published along with this report (attached).
Key Results and Implications
Impact on the local food supply from new commercial producers is most likely to be seen in farmers markets, with a lesser impact in road-side stands and restaurants. Forty-eight percent (82) of the 172 producers that did not sell product in 2012 were interested in selling in the future. This illustrates opportunity to increase the participation of these producers in commercial production by addressing the factors that limit their participation.
Distance to market may limit non-commercial producers from acting on their interest in selling their products. Efforts to develop alternative marketing options such as consignment sales, cooperative sales, and food hubs may facilitate entry of producers limited by distance.
Concern about products making people sick (food safety) was found to be a significant factor limiting non-commercial producers from beginning to sell their products. Training intended to empower producers to address food safety concerns on the farm and to understand regulations and liability may help grow new commercial producers.
Complex attitudes towards farming as a business exist among the producers in this sample. Furthermore, skepticism about the profitability of selling their products may limit non-commercial producers from beginning to sell their products. Efforts to show revenue potential through data collection and enterprise budgeting could encourage producers to consider commercial production.
Producers that plan to pass the farm on to a successor were found to be significantly more likely to expand their production. Efforts to assist producers to successfully transition farms between generations and owners will likely lead to expanded production and revenue, as well as to greater farm sustainability.
Female producers and producers with access to irrigation water in the sample were statistically more likely to expand production. Programs that seek to support female agri-preneurs and to provide access to key resources such as water could help catalyze income generation and expand the supply of local food.
Changes in Project Course
The project took longer than expected due to the heavy work involved in implementing a mail survey. Additionally, a road block was encountered when many producers wrote in expressing that they were unable to take the internet survey using the link provided. This required a second round of mail surveys to be mailed to all target producers, which naturally slowed the data collection and entry process. Part of this project also intended to gain a sense of the potential magnitude of expansion among different products of producers in the sample. This was not possible due to the low response to several questions on the survey questionnaire related to projections of production scale into the future. Upon review of data collected, it also became apparent that producers had interpreted a few survey questions other than how they were intended. Therefore the information collected through these questions was not used in analysis in order to avoid potential erroneous conclusions.
The methodology was changed slightly during the middle of the project as well. Originally, the study team had planned to implement focus groups in various regions of WV in order to inform the design of the survey questionnaire. However, this plan was changed to implement a small pilot focus group to improve the survey questionnaire. Then focus groups were implemented during the last phase of the project in order to obtain feedback and generate participatory recommendations with field professionals and producer stakeholders that could be incorporated into the outreach document.
Due to its nature as a research study, this project is more likely to have an indirect impact, rather than a direct impact, on producers and agricultural sustainability. It is expected that the information and recommendations generated through this project will inform the development of programs and activities related to encouraging greater participation of new commercial producers and helping current commercial producers to expand production. For example, the WV Farmers Market Association is interested in using some of the information from this study as they develop a new toolkit related to recruiting and retaining vendors at farmers markets. Another potential impact of this study is its ability to contribute to emerging food hub research efforts across the state. The study team has received three requests for a summary of the information generated in this study for given regions of the state in order to characterize the production and expansion limitations and intentions of the producers in that area as they may relate to potential food hub development efforts.
By playing an informative role in these development efforts that seek to enhance economic viability of farming, this project contributes to one important aspect of agricultural sustainability. Interventions that develop as a result of the recommendations in this report are likely to enhance agricultural sustainability by fomenting the participation in and income generation through WV commercial food production and sales. By bolstering the economic gain from and viability of farming as a business, such interventions can improve the likelihood that farms will continue to be maintained as farms and will be taken care of accordingly. Projections of study impact are more related to economic impact; estimates of impact on farm practices are less feasible or pertinent, given the nature of this study.
Education & Outreach Activities and Participation Summary
Oldham, Ruth Mary. Graduate Thesis (2013): Meeting the Demand for Local Food in West Virginia: An analysis of factors influencing producers’ market participation and expansion decisions. This work is a comprehensive summary of study methods, results, and implications, and is available free of charge via ProQuest at http://gradworks.umi.com/15/49/1549771.html.
Outreach document for practitioners: “Meeting the Demand for Local Food in West Virginia: Results and implications from an analysis of producer market participation and expansion decisions”, by Mary Oldham and Cheryl Brown. A key deliverable of this project was an outreach document that summarized results and implications of the study for development work related to building opportunities for local producers. This outreach document is available with this final report and has been circulated to key agencies and organizations working on local food and farming development work across WV.
Presentation at scholarly conference: “Meeting the Demand for Local Food: An Analysis of the Factors that Influence Producers’ Market Participation and Expansion Decisions”. Preliminary results and implications of the study were presented in a session at the Northeast Agricultural and Resource Economics Association (NAREA) conference in Ithaca NY in June 2013. Key outcomes of this outreach component included increased awareness of agricultural development issues in West Virginia and technical feedback from key economics experts that helped improve the final analysis and results of the study.
Presentation and focus group with WV producer group. Study results and implications were presented at a meeting with a local growers association. Over 10 growers gave feedback on the results of the study and suggested possible solutions to overcome the limitations that producers face that were identified in the study.
Presentation and focus group with the WV Farmers Market Association (WVFMA) Annual Meeting: “To sell or not to sell: What do farmers’ decisions tell us about potential new vendors?” A presentation was made to over 30 members and board members of this association on the aspects of the study that may be relevant to encouraging participation in markets such as farmers markets. Attendees provided helpful feedback on the study results and conclusions and discussed ways that their markets have or could address the limitations to market entry and producer expansion that were identified in the study. A subsequent focus group with board members and followup via email also were conducted to share results and gain feedback. This helped shape the final outreach document to make it more useful to these practitioners. The WVFMA also was interested in making the presentation available to its member markets, and planned to use some of the research results and outreach information in a toolkit they plan to develop focused on new market vendor recruitment and retention.
Collaborative effort with New Appalachian Farm Research Center (NAFRC) food hub study. Survey results were shared with Downstream Strategies and the NAFRC group who will use the information to inform the characterization of their research study that is examining practical locations for food hubs around WV.
Journal article is currently in draft form and will be submitted to a scholarly journal summer of 2014.
It will be difficult to trace any direct economic impact from this project; most impact will be indirect. For example, organizations and agencies that choose to address the limitations to expanded commercial production that were identified in this study will have an impact on enhancing commercial production and therefore increase income generated among producers.
Farmer adoption is not relevant for this study. As this was a survey-based research project, most of the study’s interaction with farmers was via the surveys and through outreach presentations and focus groups.
Areas needing additional study
The conclusions that this study was able to draw are at the state level due to the nature of the data. Further qualitative or regional-level study would be valuable in further understanding the complex nature of WV producers’ motivation towards farming as a business and the nature of more subtle limitations related to perceptions of profitability and cultural nuance. Furthermore, work to distinguish and address the limitations faced by producers in different marketing channels such as farm-to-school and wholesale channels would be valuable in order to identify how to encourage participation in these different channels.
Hartz, L., Eades, D., Brown, C., McConnell, T., Hereford, A., and Boettner, F. (2012). West Virginia Food System: seasonal production expansion and its impacts. A Report by Downstream Strategies.
LaLone, M.B. (2010). Running the Family Farm: Accommodation and Adaptation in an Appalachian Region. Journal of Appalachian Studies, 14(1,2), 62-98.
US Department of Agriculture (USDA) National Statistics Service (NASS) US Census of Agriculture: 2007. WV State data.