January 19, 2006

Your Local Farmers Marketing

Ontario organic farmers form cooperative to offset razor-thin margins

by Dru Oja Jay

The Dominion - http://www.dominionpaper.ca

These days, it's not easy being a small-scale organic farmer. Profit margins (as confirmed by Statistics Canada over the past few years) are slim or nonexistent. Large grocery chains with regional distribution centres and centralized purchasing prefer to deal with suppliers that can provide a massive supply at a consistent rate and a low price. More often than not, this means buying from US-based suppliers who have economies of scale further bolstered by government subsidies, low wages (often paid to migrant laborers), and the artificially low cost of transportation.

With the deck stacked against them, small-scale farmers have to find a way to compete--or, as many farmers do, simply give up. According to Bob Orrett of Riverside Organic Farm in Campbellford, Ontario, "the problem as I see it is that profit margins are so low - in many cases, below zero - the only chance you have to make money at all is to market things yourself."

"If you don't cut out the middle man, there's not enough left to cover your costs. The only way we're going to do this is if we go directly to the consumer."

According to Orrett, it all comes down to marketing.

"It turns out that you can't make money at farming unless you're a good marketer."

Farming, however, is hard work, and doesn't leave a lot of time for selling the food one has grown. The situation is paradoxical, by Orrett's account. "You don't go into farming because you're a good marketer."

In 2003, a number of members of the Ecological Farmers of Ontario, found themselves in a similar situation. "We were all complaining about the difficulty of marketing our products," said Orrett. A follow-up meeting in January of 2004 led to the inception of the Quinte Organic Farmers Cooperative, with the aim of combining the efforts of several farms to increase the farmers' access to local buyers.

$3,000 in startup funds from Carrot Cache bought tables, containers for transportation and other essentials, and another grant paid for the development of a business plan.

Currently, 10 member farms share the tasks of transporting produce to local farmers' markets and selling it. All work is done by members of the cooperative, and they are paid for their work.

During the cooperative's first year, efforts focused on farmers markets in Belleville, Riverdale, Campbellford and Toronto. The cooperative's tables sold strawberries, mushrooms, vegetables, and meats

The Quinte Organic Farmers Cooperative's business plan calls for selling to specialty shops and restaurants as well as farmers' markets, but the flexibility of the latter and a lack of workers led to a focus on the markets.

"We met or broke our goals for the farmers' markets. We just didn't have the person power" to market to restaurants, specialty shops and other buyers, said Orrett.

Over all, Orrett calls the cooperative's first year "very successful".

"We are all still together, we all did better this year compared to last, and we have already started planning for next year."

This is not to say that starting the cooperative has been a painless process. Orrett says there is a "huge learning curve" for logistics and day-to-day operations. Quality control and delivery schedules have to be coordinated among ten farms. Also, due to slim profit margins on one side and low-priced competition on the other, pricing is a precision art for farmers.

Being a cooperative, according to Quinte Organic Farmers Cooperative's web site, means that it is an "autonomous, self-help organisation controlled by its members." Built into the idea of a cooperative is "a concern for community", sustainable development, and support and cooperation with other cooperatives.

Despite the delicate situation of family farms, Orrett remains optimistic. With rising oil prices, he says, the "efficiency" of massive industrial farms will become elusive. "Efficiency is going to be small scale local farming," Orrett explains.

Orrett thinks small farms have the advantage of being flexible, and able to change quickly to serve a local market, while industrial farms will be stuck with high transportation costs and fossil-fuel-based pesticides.

In the mean time, the cooperative promises to continue to be an innovative way for farmers to stay in business by working together and with the communities they serve.