Production and Marketing Opportunities for Small Farms
Marion Long Bowlan
To survive in the rapidly changing agriculture markets, small producers are changing and developing alternative markets that meet their needs to control quality and manageability. I will talk to you about a few Pennsylvania farmers, including myself, who are developing these markets.
Barbara Wiand is a hog producer who has a 300-sow farrow to-finish operation on a 240-acre farm in central PA. The closing of a local slaughtering plant and last years hog market crash forced the family to make a major decision about their future direction. The choices were to get bigger and raise more hogs, increasing the environmental and pollution risks; sell the hogs and seek employment off the farm, which was not acceptable to her family and their employees; or explore alternative marketing channels. Barbara's family decided to complete their circle of sustainability by marketing their own pork products.
Barbara organized other pork producers in her area to ship hogs to a plant 175 miles away to defray trucking costs and meet quota numbers. Together, the group markets approximately 200 sows per week. The framework for a marketing alliance is in place and representing a large enough quantity to sustain an independent marketing enterprise. The potential to supply one or more major grocery chains in the local area is there. Barbara plans to deliver a brand name, gourmet ham into the hands of customers by October 2000. Her goal is "to take control of and capture the net margin at some or all of the stages in the value-adding chain."
John Jamison bought a farm near Pittsburgh that was strip-mined and converted it to grazing pastures for sheep. Early on he decided to go into the mail order business since his market research indicated the average consumer only eats a few pounds of lamb annually. He advertised in gourmet magazines, set up an 800 number, and thought the orders would role in. That first year, 1985, he sold a total of 13 lambs. But, he persevered. By developing a top quality product and paying attention to the details of processing and shipping he was able to deliver a premium product on deadline. He sold chops and legs to first class restaurants and for the other cuts he developed a delicious bottled lamb stew. Today he has taken over the processing of his lamb and sells it mail order throughout the United States and the world.
Roman and Lucy Stolzfus are Lancaster county farmers who operate a 200+ acre certified organic dairy and turkey farm. 1n 1992 they converted their farm to grazing in an area where the soils are deemed to be "too good" to be in grass. They are proud of the fact that they had a 29% drop in gross operating costs for their 100-cow dairy in the last two years. Roman and Lucy also market 8,000 organic turkeys annually, primarily in Pennsylvania, New York and surrounding areas.
Ten years ago, Roman retailing his turkeys but was having difficulty getting the kill space from local processors for his birds and meeting the labor demands of on farm processing. He made a deal with the processors to turn over his customers to them in return for a wholesale agreement. Today, he sells most of his organic birds far 80-90 cents a pound wholesale and he retails a few hundred at a $1.50 pound.
He believes the best poultry market for small producers is in the retail market with on farm processing. For example, he says a small producer can clear $5,000 on 500 turkeys for 20 weeks of work. However, he believes the best opportunity for small producers are on a grass-based dairy.
I grew up on a diversified family farm in Lancaster County. We raised cows, steers, pigs, chickens, tobacco, potatoes, and had a market garden. I helped my dad at the weekly farmers market from the time I was 10 until I was 16. I thought farming was only about work, work, and more work. I went off to college to seek a better life and had no desire to look back. But I couldn't get that desire to grow things out of my blood or out of my soul. When the opportunity to buy my grandparent's farm became available, I convinced my suburban raised husband who couldn't tell the difference between hay and straw that it wasn't a totally ludicrous idea to move back to the farm.
Against the advice of my parents and the conventional wisdom, we converted our whole farm to grass, permanently fencing the perimeter. My only regret is that we didn't do this sooner. At about the same time, the bottom fell out of the beef market. If we were to survive, we knew we needed other marketing channels than the cash market. We decided to raise hormone and antibiotic free beef on our lush pastures and sell the meat directly to consumers. To ensure good herd health, we closed our herd and only sold animals raised on our farm. We also market all natural beef stick, made from our beef and processed locally.
Our vision for the future includes expanding into the restaurant trade with our grass-fed beef. New research indicates that grass fed cattle contain omega-3 fatty acids, the good fat. Health conscious consumers can help us to continue to expand our market.
How USDA Can Help
There are many more individuals in Pennsylvania and the nation that are looking for ways to realize more profit from their small livestock and poultry farms. I would like to use this opportunity to tell you how USDA can help them.
Expand local marketing opportunities: This is where small farms have the greatest chances of success because of the relationship qualities of local sales.
Consider instituting small farm marketing agents, similar to a real estate or entertainment agent, who earns a commission on what they are able to sell for the client, in this case the small farmer.
Assist beginning and small farmers expand their marketing and entrepreneurial savvy so that they can compete.
Expand marketing alliance and cooperative opportunities.
Provide market incentives to small local processors and encourage them to partner with small farmers.
Level the playing field, by enforcing the Packers and Stockyards Act, prohibiting discriminatory pricing based on volume, and passing current legislation that would provide interstate shipment of state-inspected meat.
Realize that our small farms contribute more than money to the local and national economy. They also contribute diversity, environmental benefits, community responsibility, self-empowerment, and finally places for families.
As a small farmer, I really don't want a government handout. What I want is a level playing field where I can compete and prove to consumers how Bowlan's Better Beef is the beef that they want for dinner.
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