15 Case Studies on Local Food Supply Chains

15 Case Studies on Local Food Supply Chains
Kristen Park, Food Industry Management Program, Cornell University

Researchers at Cornell were fortunate to participate in a series of case studies sponsored by the US Department of Agriculture – Economic Research Service (USDA – ERS) and just released this summer. The case studies looked at a total of 15 different food businesses in 5 different states with the purpose of examining the way in which local food products are being introduced or reintroduced into the broader food system along with the potential barriers to expanding markets for local foods. The cases included the following products and locations, with 3 different businesses examined under each:

• Apples in Syracuse, NY
• Blueberries in Portland-Vancouver-Beaverton, OR-WA
• Spring mix in Sacramento, CA
• Beef in Minneapolis-St. Paul-Bloomington, MN-WI
• Fluid milk in Washington, DC

Despite increasing consumer interest in locally grown and processed food, not very much is known about how supply chains that move local foods from farms to consumers compares with the “mainstream” supply chains that move products through supermarkets. With funding from USDA’s Economic Research Service, a team of researchers from Oregon State, University of California – Davis, University of Minnesota, USDA – ERS, and Cornell University conducted a coordinated series of case studies on supply chains for local food products. For each of the product-place combinations listed above, case studies were conducted on:

• The predominant grocery supply chain for a product category (mainstream supply chain)
• A supply chain for a local product that is marketed directly by producers to consumers (direct market supply chain)
• A supply chain for a local product that reaches consumers through one or more intermediaries (intermediated supply chain)

What did the study find? (report summary):
Case studies of mainstream supply chains and two types of local food supply chains reveal the great variety of ways that food products can move from farms to consumers. Products from local farms may appear in mainstream and local supply chains, and products from more than one supply chain may be present in the same outlets. Businesses in all types of supply chains face challenges to reduce production, handling, and transportation costs. Higher per unit costs in local supply chains (relative to the mainstream chain) do not preclude success.

Farms that participate in local food supply chains tend to have a diverse portfolio of products and market outlets. In some cases, diversification may help spread out large fixed costs across a number of different revenue streams. Other farms may be large enterprises that participate in mainstream supply chains and use local supply chains as a residual market. In total, local supply chains handle a relatively small portion of total product demand, and in some cases local products fill a unique market niche as a differentiated product.

Local food supply chains, particularly direct market chains, are more likely to provide consumers with detailed information about where and by whom products were produced. However, this information alone is unlikely to be sufficient to sustain price premiums for local products. Price premiums are observed when products exhibit additional differentiating characteristics. Prices in local supply chains are also determined differently. They tend to be decoupled from national commodity market prices, particularly in direct market supply chains. Instead, prices are influenced by local supply and demand relationships and by product differentiation based on attributes other than local.

Producers receive a greater share of retail prices in local food supply chains, which is often a motivating factor for choosing to sell through them. In all the direct market cases producers assume responsibility for additional supply chain functions, such as processing, distribution and marketing, to capture revenue that would otherwise accrue to an outside party. These supply chain functions can be costly and often involve the operator’s own unpaid labor. Although farms in direct market supply chains retain nearly 100 percent of the retail price, additional costs incurred to bring their product to market can reduce their net returns by between 20 and 60 percent.

Transportation fuel use is more closely related to supply chain structure than the distance food products travel, and product aggregation to reduce per-unit costs is an important determinant of transportation fuel efficiency. Local supply chains require fewer food miles to move products from farms to consumers, but fuel use per unit of product in local chains is often greater than in the corresponding mainstream chains. In these cases, greater fuel efficiency per unit of product is achieved with larger loads and logistical efficiencies that outweigh longer distances.

Findings from these case studies are presented in Comparing the Structure, Size, and Performance of Local and Mainstream Food Supply Chains, USDA, Economic Research Service, ERR99, which is available online at http://www.ers.usda.gov/Publications/ERR99/While the case descriptions were condensed in the ERS report due to length, expanded descriptions of all the case studies are available from the University of Minnesota on its website http://foodindustrycenter.umn.edu/local_food_case_studies.html :

Apple Case Studies in the Syracuse, New York MSA
Blueberry Case Studies in the Portland-Vancouver MSA
Spring Mix Case Studies in the Sacramento Area
Beef Case Studies in the Minneapolis-St. Paul-Bloomington MSA
Fluid Milk Case Studies in the Washington, D.C. Area

Case study researchers:
University of Minnesota: Robert P. King, Gigi DiGiacomo
Oregon State University: Larry Lev
USDA – ERS: Michael S. Hand, Kate Clancy
University of California – Davis: Shermain D. Hardesty
Cornell University: Miguel I. Gómez, Edward W. McLaughlin, Kristen Park

“Smart Marketing” is a marketing newsletter for extension publication in local newsletters and for placement in local media. It reviews elements critical to successful marketing in the food and agricultural industry. Please cite or acknowledge when using this material. Past articles are available athttp://marketingpwt.aem.cornell.edu/publications.html.

Emerald Ash Borer Detected in Steuben & Ulster Counties

Additional Investigation Planned After Invasive Beetles Found in Traps

New York State Department of Environmental Conservation Commissioner Pete Grannis and state Agriculture Commissioner Patrick Hooker today announced the discovery of the Emerald Ash Borer (EAB) on private properties in the Town of Bath, Steuben County, and Town of Saugerties, Ulster County. The EAB is a small but destructive beetle that infests and kills North American ash tree species, including green, white, black, and blue ash.

The first detection of EAB in New York was in the town of Randolph, Cattaraugus County, in June 2009 (http://www.dec.ny.gov/animals/56774.html). Since the Randolph find, state and federal officials have implemented an extensive monitoring effort that includes the deployment of approximately 7,500 EAB purple traps in ash trees in high risk locations including major transportation corridors.

The Steuben County discovery occurred on July 12 when a state Department of Environmental Conservation (DEC) staff member inspected one of the state’s EAB purple traps. The traps are sticky and contain a chemical lure that attracts adult EAB. The detection was confirmed this week by Cornell University. The Ulster County discovery occurred on July 15 after USDA’s Animal and Plant Health Inspection Service (APHIS) staff member check of a federally-deployed EAB trap and confirmed by USDA APHIS. Each EAB trap had one confirmed EAB specimen.

Commissioner Grannis said: “DEC, the landowners, and our federal, state and local partners will work closely to study the extent of EAB’s presence in the newly-confirmed area and take the appropriate steps to protect the state’s ash resources. We have reason to believe that the movement of EAB to these new areas was due to the movement of firewood, and as summer is now in full swing, we again remind campers throughout the state that they too can help prevent the spread of harmful invasives by not hauling firewood to campgrounds and instead buying firewood locally.”

Commissioner Hooker said: “As we continue to find EAB it is important for us all to recognize the challenges we face from this pest and other invasive species. We are currently working to contain EAB, however, in spite of our best efforts, science and some models suggest that EAB is nearly impossible to contain and will likely spread into other areas of the state in the next several years. The Department of Agriculture and Markets is administering a quarantine designed to slow the spread of this pest. Residents can assist the state by being aware of how to identify and report unusual bugs.”

New York has more than 900 million ash trees, representing about seven percent of all trees in the state, and all are at risk. This is just the latest in a series of terrestrial and aquatic invasive species detections across New York State, including the Asian Longhorned Beetle, Sirex woodwasp, didymo, zebra mussels, and Eurasian water milfoil. They have prompted the state to strengthen regulations, increase educational outreach, and encourage ways of limiting the unintentional spread of these potentially devastating pests throughout the state.

In 2008, New York adopted regulations that ban untreated firewood from entering the state and restricts intrastate movement of untreated firewood to no more than a 50-mile radius from its source (http://www.dec.ny.gov/animals/28722.html). This was done as a precaution against the introduction and spread of EAB and other invasive species because of the documented risk of transmission by moving firewood. DEC’s firewood regulations prohibiting out-of-state transport of untreated firewood and intra-state movement of untreated firewood more than 50 miles remain in effect and are extremely important tools. After more than three years of outreach and education efforts about the risks of moving firewood and the state’s regulation, DEC is increasing its enforcement efforts to prevent the movement of untreated firewood into and around New York.

Yvonne DeMarino, State Plant Health Director for USDA APHIS, said: “We are working in cooperation with the state to detect, control and prevent the human-assisted spread of this pest. This is a huge undertaking and therefore we also need the support and cooperation of every New Yorker to promise not to move firewood.”

New York State has been actively surveying for EAB since 2003, inspecting declining ash trees and setting detection tools statewide.

THE EMERALD ASH BORER:
The EAB has metallic green wing covers and a coppery red or purple abdomen; it is small enough to fit easily on a penny (photos:http://www.agmkt.state.ny.us/CAPS/pdf/Emerald%20Ash%20Borer%20Poster.pdf andhttp://www.dec.ny.gov/animals/7253.html). Damage is caused by the larvae, which feed in tunnels called galleries in the phloem just below the bark. The serpentine galleries disrupt water and nutrient transport, causing branches, and eventually the entire tree, to die. Adult beetles leave distinctive D-shaped exit holes in the outer bark of the branches and the trunk. Other signs of infestation include tree canopy dieback, yellowing, extensive sprouting from the roots and trunk (called “epicormic shoots”). Infested trees may also exhibit woodpecker damage from larvae extraction.

Since its discovery in southeastern Michigan in 2002, the EAB is responsible for the death and decline of tens of millions of ash trees in the U.S. Today the beetle has been detected in 14 states and two neighboring Canadian provinces. The primary way this insect spreads is when firewood and wood products are moved from one place to another. Many of New York State’s forests and parklands are high-risk areas due to firewood movement.

WHAT IS BEING DONE NOW:
A cooperative effort among USDA, New York State, Cornell and SUNY College of Environmental Science and Forestry will conduct a thorough delimiting survey of trees to assess the extent of beetles in both areas. Information from this survey will help determine the response strategy.

The New York Invasive Species Council and DEC’s Office of Invasive Species Coordination were established in 2007 to help detect new invasive species outbreaks and rapidly respond to such incidents. Further follow-up to slow the spread of this very destructive forest insect will depend on funding made available. New York is working with state and federal legislators and agencies to inform them of the recent finds and the urgent need to identify additional funding sources to address these new occurrences.

WHAT OTHERS CAN DO:
New Yorkers are urged to take the following steps to keep EAB from spreading to other areas of the State:

• Leave all firewood at home – please do not bring it to campgrounds or parks.
• Get your firewood at the campground or from a local vendor – ask for a receipt or label that has the firewood’s local source.
• If you choose to transport firewood within New York State:
  • It must have a receipt or label that has the firewood’s source and it must remain within 50 miles of that source.
  • For firewood not purchased (i.e., cut from your own property) you must have a Self-Issued Certificate of Source, and it must be sourced within 50 miles of your destination.
  • Only firewood labeled as meeting New York’s heat treatment standards to kill pests (kiln-dried) may be transported into the state and further than 50 miles from the firewood’s source.
• Watch for signs of infestation in your ash trees. If you suspect your ash tree could be infested by EAB, go to the websites below for more information. If damage is consistent with the known symptoms of EAB infestation, report suspected damage to the state by calling 1-866-640-0652 for appropriate action as time and resources allow.

For more information, visit the following web pages:
www.aphis.usda.gov/plant_health/plant_pest_info/emerald_ash_b/index.shtml
http://www.agmkt.state.ny.us/CAPS/pdf/Emerald%20Ash%20Borer%20Poster.pdf
http://www.dec.ny.gov/animals/7253.html

Contacts:
DEC Maureen Wren (518) 402-8000
DAM Jessica Ziehm (518) 457-3136

Walking Tour in the Village of Skaneateles

Cornell University Cooperative Extension of Onondaga County (CCE) is pleased to announce the Village of Skaneateles Walking Tour, sponsored by the City of Syracuse Water Department. Participants in the tour will learn how Skaneateles Lake has influenced the cultural heritage and rich history of the village.

The walking tour will commence on Wednesday, July 28th at 10 a.m. at the pier in the Village of Skaneateles. Participants will be taking a round-trip walk which includes stops at the John D. Barrow Art Gallery, the Old Stone Mill, the Creamery, the Gatehouse and the CCE Rain Garden located at the City Water Garage. Speakers at each stop include Peg Whitehouse, Director of the John D. Barrow Art Gallery; Beth Batlle of the Skaneateles Historical Society; Mike Lynn, Plant Operator at the Gatehouse (Water Department); and, Kacie Gehl, Community Educator for CCE.

Pre-registration for this event is appreciated. Please contact Kacie Gehl at (315)-424-9485 ext. 232 or klg86@cornell.edu or at http://www.extendonondaga.org/Registration.tab.aspx.

The Cornell Cooperative Extension educational system provides equal program and employment opportunities. Please contact our office if you need special accommodations.

General Tree Care Workshop

Cornell University Cooperative Extension of Onondaga County is hosting a general tree care workshop. This workshop will take place on Thursday, July 8, 2010 from 5:00 p.m. – 6:30 p.m. at the Skaneateles Community Center, 97 State Street, Skaneateles, NY. This workshop will focus on general care for your trees to prevent pests and pathogens, and survive environmental stress such as drought, invasive insects and ice damage. We will highlight proper pruning and mulching techniques, and selecting suitable planting locations.

For details about the workshop and to register, visit www.extendonondaga.org or call Jessi Lyons at 315-424-9485 x233. This workshop is a free to the community. Cornell University Cooperative Extension of Onondaga County provides equal program and employment opportunities.

Invasive Weeds in our Waters

Aquatic invasive plants can grow in creeks, rivers and lakes in Central NY. Weeds are considered invasive when they quickly take over an area, and can be both native and non-native plants. Invasive weeds decrease recreation opportunities by covering boating and swimming areas. Often, non-native invasives will crowd out native plants and animals, impacting the local fisheries and altering the ecosystem. Economically, this can hurt the local fishing industry and can decrease lakefront property values. Each aquatic invasive weed must be managed differently depending on the life cycle and growing habit of the weed. Depending on the type of weed, they can be pulled by hand, mechanically harvested or biologically or chemically controlled. Some of the weeds you may have encountered in our local waters include water chestnut, Eurasian milfoil, and the recently introduced Eurasian frogbit. There are more weeds out there: some good and some bad – it’s important to know the difference and how to manage for each species.

Cornell University Cooperative Extension will be hosting multiple workshops this summer to educate communities on how our actions influence water quality and the abundance of aquatic weeds and how to abate aquatic invasive weeds from our waters. To register for events and for further details, visit www.extendonondaga.org or call 315-424-9485. Workshops are as follows:

Oneida Lake Homeowner’s Guide to Aquatic Invasive Plants: Prevention, Identification and Control
Tuesday, July 6, 6-8pm, Cicero Library

Otisco Lake Water Chestnut Pull Event
Wednesday, July 7, 3pm, Otisco Lake Park

Oneida Lake Water Chestnut Pull Event
Tuesday, July 13, 4:30pm, Meet at Big Bay Marina, 155 Camic Rd, Central Square

Otisco Lake Homeowner’s Guide to Aquatic Invasive Plants: Prevention, Identification and Control
Wednesday, July 14, 6:30-8pm, Otisco Lake Community Center, 2223 Amber Rd. Marietta, NY

Otisco Lake Train-The-Trainer Workshop
Wednesday, July 21, 6:30-8pm, Otisco Lake Community Center, 2223 Amber Rd. Marietta, NY