Reader Question: The Cost of Eating Local

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15 Sep Reader Question: The Cost of Eating Local

RedCarrots

A while ago a reader emailed me one of the best questions I’ve received in a long time. She voiced the frustration we all feel trying to align our ideals with our pocket books when she wrote:

I live in the Niagara Region of Ontario, one of, if not Canada’s largest fruit producer, and I have always tried to buy Canadian, and not just for food. However, I do get annoyed when I go to the local market and find that our Ontario strawberries are $5.99 a container and the Californian ones are only $3.99 (same quantity) and they are actually firmer and sweeter then the locally grown ones. Which strawberries would you buy? On a fixed income I have little choice if I want to eat fresh.

In Niagara we are surrounded by orchards of cherries, peaches, plums, and fields of strawberries, corn, tomatoes, etc. yet we pay as much or more at our road side stands (straight from orchards and fields) as we pay for imported produce in the grocery store. My question is WHY? Is that necessity or greed?

I wish someone could give me a good answer…

Well, frustrated reader, while we can blame the poor strawberry crop on the wet weather, the pricing is a different matter. And it’s not greed on the part of our local farmers. Many of them haven’t seen a raise in more than a decade.

The answer below, which summarizes the situation very concisely, comes via Dana McCauley. I won’t go into details, but Dana learned the answer to my question while interviewing Paul Sawtell and Grace Mandarano of 100km Foods Inc., and in a trademark gesture of generosity, she passes their excellent answer onto you.

Pay it forward to Dana by popping by her blog. Today she’s looking at innovative and socially conscious companies, like 100km Foods, that are making it easier for chefs to buy local crops.

But back to the question of why local foods are often more expensive. While the topic could fill a book, Sawtell’s answer (emphases mine) sums it up in one paragraph:

The fact that on average, local food costs more than imported foods from thousands of kilometres away speaks to a much larger geopolitical issue. Largely driven by cheap labour and cheap transportation costs, and in many cases massive surpluses, export dumping and government subsidies, it still baffles me that products can travel thousands of kilometres and remain cheaper than something produced literally down the road in some cases. This is not a comment on how expensive local food is, it is more my comment on how cheap, and artificially cheap, imported food can be. And sadly, cheap food is what North American consumers have come to expect.

Now before you think I’m just sitting back and letting Dana do all the work, I did speak with Sawtell myself. In a follow-up call, I asked him how we consumers could bring the costs down. He said food follows the standard economical model of supply and demand. Abundance lowers price. When there’s a steady demand for locally grown crops, the price will go down.

But will locally grown, small crops ever be as inexpensive as government-subsidized foreign food grown on a large scale and picked by cheap labour? No, but you can narrow the price gap buying from local farmers.

How can you do this? Two simple ways include heading down to the local Farmers’ Markets or buying a share of Community Supported Agriculture (CSA). Not sure where to start? Here are some links that might interest you.

Do you support local farmers? If so, how? If not, what (other than price) stumbling blocks do you encounter?

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No Comments
  • danamccauley
    Posted at 08:01h, 15 September Reply

    Charmian, so glad you had a chance to connect with Paul personally! I love what he and Grace are doing and your links are very helpful!

    I really enjoyed collaborating with you on answering this reader's excellent question. You give me more credit than I deserve for merely passing on some info that was at my fingertips.

    Have a great day!

  • Daniel
    Posted at 08:17h, 15 September Reply

    Hi Charmian, thanks for an exceptional post. I've always felt that there are a lot of counterintuitive things about the developed world's food supply.

    I remember reading in the late 80s how something like 50% of the then-USSR's food supply rotted before it ever got to market. At that time the US and Canada's transport infrastructure was the envy of the world. Now we're facing the highly counterintuitive truth that suddenly it's "too cheap" to transport foods long distances because it's wasteful of both fossil fuels and it hurts the competitiveness of local farmers which doesn't have the same scale mechanisms to get their produce to local markets.

    Most grocery stores and restaurants already are hooked up to the large scale/long distance food transport infrastructure. They can only benefit by diversifying and adding more supply from local sources as well. Sure, sometimes the local products will be not as good and/or more expensive, but that price and quality information will help the local farmers figure out what the market wants so they can grow it. Eventually we'll see both sides of the supply chain adjust to demand and supply products that the consumer wants–and then everybody will stand to benefit.

    Dan
    Casual Kitchen

  • Christie's Corner
    Posted at 08:34h, 15 September Reply

    Dana, you're being modest. You were very generous to pass along the information — even if it was at your fingertips.

    Daniel, you raise an excellent point about diversifying to balance the system. Here in Canada we can't get local produce year round — but it's infuriating to see garlic from Argentina and China when locally grown is in season.

    Keep the comments coming! This is a complex topic…

  • Sherron
    Posted at 10:56h, 15 September Reply

    I am the reader who posted the question we are discussing here. While I understand the economics of supply and demand, what I still cannot understand especially when it comes to the roadside vendor, is why the produce is the same price as in the grocery store without the associated overhead? This is the farmer selling their produce directly with no wholesaler profit, no grocery store profit and no transportation costs to cover.

    I believe the point these farmers are missing is that this practice does not encourage people to buy local. Instead they should be selling their produce at what they would normally get from the wholesaler and then gaining overall profit with volume. Only then will they be building the ‘buy local’ mentality which will increase the demand.

  • Cheryl Arkison
    Posted at 12:00h, 15 September Reply

    I want to weigh in on the discussion, following up on Sherron's own follow-up.

    Please keep in mind that the vast majority of farmers selling local produce are not doing it on a large scale. When you do not have a large, commercial farm it takes a lot of manpower to produce that crop, and yes, some very expensive machinery. So while the roadside stand does not have the overhead of shipping, grocery store utilities and construction, and levels of profit, they do have to pay for the folks who help them pick, their own mortgage, and hopefully, a wage for themselves. They need to make a living too.

    One of the reasons we have large scale agriculture (subsidies and transportation infrastructure aside) is the notion of economies of scale. It is cheaper to produce more on a large scale with machinery than on the small scale with people. That local grower is doing it on the small scale.

    Now, all that being said, I do wonder if there is a notion of a luxury premium on local foods. Is there an element of marketing in the pricing because a certain percentage of buyers of local foods are solidly middle class? I don't know the stats at all, but I wonder who really buys local because they can and want to versus those who want to but can't?

    Ona personal note, we've really made a solid switch to local about 80% of the time. It is a combination of farmers' markets, u-picks, and a CSA. But I still buy citrus, tea, chocolate, and maple syrup – I can't give those things up.

  • Cheryl Arkison
    Posted at 12:00h, 15 September Reply

    I want to weigh in on the discussion, following up on Sherron's own follow-up.

    Please keep in mind that the vast majority of farmers selling local produce are not doing it on a large scale. When you do not have a large, commercial farm it takes a lot of manpower to produce that crop, and yes, some very expensive machinery. So while the roadside stand does not have the overhead of shipping, grocery store utilities and construction, and levels of profit, they do have to pay for the folks who help them pick, their own mortgage, and hopefully, a wage for themselves. They need to make a living too.

    One of the reasons we have large scale agriculture (subsidies and transportation infrastructure aside) is the notion of economies of scale. It is cheaper to produce more on a large scale with machinery than on the small scale with people. That local grower is doing it on the small scale.

    Now, all that being said, I do wonder if there is a notion of a luxury premium on local foods. Is there an element of marketing in the pricing because a certain percentage of buyers of local foods are solidly middle class? I don't know the stats at all, but I wonder who really buys local because they can and want to versus those who want to but can't?

    Ona personal note, we've really made a solid switch to local about 80% of the time. It is a combination of farmers' markets, u-picks, and a CSA. But I still buy citrus, tea, chocolate, and maple syrup – I can't give those things up.

  • Terry Cohoe
    Posted at 12:55h, 15 September Reply

    I'm glad Cheryl mentioned the higher cost of doing things on a smaller scale. I hadn't thought of that and it makes me feel a lot better about the pricing. I also find that when I look at this farmer who works so hard, most often with his/her entire family invested in the process, I don't feel bad about spending a little extra on their produce. I also find that at the market, the prices seem to be closer to the supermarket prices (side by side competition perhaps?). Having said that, there is a roadside stand near us that I will pay gold bars to for their produce — it is just that good. Interesting topic!

  • Kitchen Goddess
    Posted at 13:20h, 15 September Reply

    Our favourite apple orchard in Brampton last year closed their decades old farm, moved the orchard to Collingwood. Couple of reasons: 1. They could get 10 million for the LAND the family had sat on for decades. 2. He couldn't interest his (adult) children in continuing the farm, so rather than letting it deteriorate, he sold it to reap some financial gain. 3. The genetically altered produce picked overseas, using cheap labour, and picked/packed before ripening, means the picture perfect fruit is cheaper to buy here than it is to ship apples that can't be "stored" for a long time. They are heritage seeds, but…you gotta eat 'em when you pick 'em. Better for us to eat, but not transportable to market. And, 4. that direct to consumer method simply cannot sustain a farmer's family. We have such a short season here, there is no way for our soft fruit/veg farmers to make a living based on the seasonal harvest.

    All sad…but true. And I will always pay a little more for Ontario berries than substitute those tasteless California things, but then I have to give up something else on the shopping list to accommodate. We have to make the choices that make the most sense for each family.

  • Cheryl@ 5 Second Rule
    Posted at 14:48h, 15 September Reply

    Fascinating discussion. I especially appreciate the economics lesson because that's not my forte.

    I'll add that there are many, many farmers' markets here in Northern California, and I live almost equidistant between two of them. I used to go to the first, until I realized that the prices were much cheaper at the second. The quality is identical.

    Why the cost disparity? I'm convinced it's because the first market is in a tonier neighborhood.

    The two markets are about 10 minutes apart.

  • don
    Posted at 15:38h, 15 September Reply

    As Cheryl Arkison points out, there is a seeming luxury premium to eating local and/or organic. Whether this is because of an inability to achieve economies of scale has not been determined.

    In the past several years, I have seen large chained grocery stores sell organic or heirloom produce from large scale production that have achieved economies of scale. Yet, these products are priced at the same price point as local produce (organic or mostly organic) that come from much smaller scale production (e.g. people instead of machines).

    The reasons I look toward local producers or retailers of goods made from local products involve
    1) supporting the local economy and
    2) my finding smaller scale production produces better quality ingredients: taste-wise and texture-wise.

    For instance tomatoes are naturally sweeter and more succulent if they can spend more time on the plant. Yes, California strawberries may be physically bigger. They have been bred to be that way, but I find them water logged and tasteless. The strawberries I adore are half the size, not nearly as plump, have a powerful fragrance, and are sweet beyond compare. They come from field to plate in hours, not days.

    In Ottawa, we have several farmer's markets whose vendors proudly sport Savour Ottawa posters (http://www.savourottawa.ca). These posters denote that the producer or retailer has been certified via an audit by a third-party organization to produce local products or sell goods that are made from local products. Further, many of the locally-owned restaurants have already diversified their supply chains, pairing themselves with local farms. Some have even taken to growing their on produce in personal gardens. Many have even partnered with our local sustainable fin-fish and shell-fish supply.

    I encourage buying local as much as is possible and going to eateries that do the same. That is, when the produce and/or products are available. Canadians face several months of inhospitable weather.

    The way I see it, and I could be wrong, if local producers can be guaranteed more sales of their wares either directly or indirectly through up market products or supermarkets, perhaps they can be convinced to sell their products at lower margins. Big box stores, at the same time, need to be convinced to support local business, keep markups low, or have no business at all.

    Now, I should point out that I am a foodie. I believe that, to appreciate food, you need to learn how to cook. At the moment, I can afford to spend money on quality ingredients, but, with salaries not accounting for inflation, I know many can't. Families tend to be most hard pressed to eat local.

  • Frugal Kiwi
    Posted at 16:34h, 15 September Reply

    Thanks for the post. As serendipity would have it, I just started reading Waste: Uncovering the Global Food Scandal yesterday, so it is very topical for me.

    Trying to eat local in New Zealand is a real challenge. Lamb, beef, dairy, apples, kiwifruit are no trouble in season. Wheat, rice or beans? Forget it.

    If Kiwis were suddenly limited to the food that was produced in NZ, there would be people starving.

    We choose local when possible and have our own garden as well, but the idea of the 100 Mile Diet is a no go.

  • Cheryl Arkison
    Posted at 16:44h, 15 September Reply

    Supporting the local economy! I've heard it said, but I don't have the source handy, that when you buy local you are actually keeping something like 60-80% of the dollar local, as opposed to something like 10% by purchasing shipped-in produce. I think those are Alberta/Canadian stats (give me some time and I can try to find them).

    Our family's desire to buy local didn't start as a foodie thing (although we are foodies). We were always the ones to buy from the corner store instead of the grocery store, from the independent liquor store instead of the chain – even if those places were more expensive or less convenient. It was about supporting the little guy who was just trying to make a hard-earned living. That extended into our food purchases.

    Yes, buying local or organic is more expensive, but I've also found that I am sharper with my grocery dollars. I think more about what I'm going to make and there is very little of my food wasted at the end of the week. If I'm going to spend the money I make it worthwhile.

  • Cheryl Arkison
    Posted at 16:44h, 15 September Reply

    Supporting the local economy! I've heard it said, but I don't have the source handy, that when you buy local you are actually keeping something like 60-80% of the dollar local, as opposed to something like 10% by purchasing shipped-in produce. I think those are Alberta/Canadian stats (give me some time and I can try to find them).

    Our family's desire to buy local didn't start as a foodie thing (although we are foodies). We were always the ones to buy from the corner store instead of the grocery store, from the independent liquor store instead of the chain – even if those places were more expensive or less convenient. It was about supporting the little guy who was just trying to make a hard-earned living. That extended into our food purchases.

    Yes, buying local or organic is more expensive, but I've also found that I am sharper with my grocery dollars. I think more about what I'm going to make and there is very little of my food wasted at the end of the week. If I'm going to spend the money I make it worthwhile.

  • Paul Sawtell/100km Foods
    Posted at 19:44h, 15 September Reply

    Wow, fantastic discussion! I am so glad to see so many people engaged and informed about this topic.

    A little tangent; I am currently reading 'Why your world is about to get a whole lot smaller; oil and the end of globalization' by Jeff Rubin, former chief economist for CIBC world markets. Very intereesting read but where food is concerned is makes some interesting predictions. Cheap imported food (and cheap manufactured goods for that matter) are available and competitive largely because transportation costs and oil prices have remained relatively low. Even after transporting goods thousand of miles, it has remained more competitive and cost effective to produce them overseas where cheap labour is the norm.

    Rubin predicts that triple digit oil prices (per barrel) will become the norm in the coming years. What will that do to the competitive and comparative advantage of overseas cheap labour? There will be a threshold when the new high costs of transportation will negate any competitive advantage of overseas cheap labour. Bottom line is that one day soon, it may just be cheaper to eat locally than importing food from long distances.

    Rubin even goes so far as to predict that one day, the high value of local food and hence local land may lead to the redevelopment of suburban landscapes back to farm land. Imagine that.

    Great discussion and thank you Charmian for the great post!

  • Amanda Strong
    Posted at 20:18h, 15 September Reply

    Fabulous comments and discussion. I also reckon that the similarity in pricing between smaller family farm and the industrially-produced produce sold at supermarkets really comes down to the size/scale thing. Mass produced items will always be cheaper to produce per unit. Cheaper, but certainly not less expensive when you consider the environmental and social costs of many large farm operations and their shipping requirements.

    Where I think local food wins is in the quality and diversity of the product. The produce at farm stalls and farmer's markets are almost always fresher, which usually translates into tastier. I can also get a wider variety of types of beans and tomatoes, corn, or even beef and pork. Industrial agriculture limits itself to varieties that offer uniform size, consistency, and travel well.

    Local food also wins by supporting the local economy. By buying local my dollars go back into the community. The farmers, the labourers they employ over the summer, and perhaps the restaurants and small businesses they supply all benefit.

    I realize, sadly, that despite the benefits of buying local, it is not an option for many folks. I wish that wasn't the case, but it is. I'm grateful for my own ability to choose to buy local, quality food; and certainly understand the frustrations of those who want to, but simply can't. Certainly, given the choice between a hungry belly or not, understandably taste and local economy barely enter into the equation.

  • lis
    Posted at 20:36h, 15 September Reply

    I'd like to echo the last comment. When we are thinking about food costs, we should think beyond our pocketbook. There are social and environmental costs that we have to consider. Perhaps the imported strawberries are cheaper for us as consumers, but the cost is artificially low. When produce is sold by large conglomerations, the farmer gets a tiny fraction of the profit. Artificially low prices for produce also lead to poor working conditions, sometimes slavery, for those who harvest the produce.

  • Cheryl Arkison
    Posted at 02:11h, 18 September Reply

    Just saw another movie on this topic. Tableland. Wonderful words from lots of farmers. Put a bit of perspective on it.

  • Cheryl Arkison
    Posted at 02:11h, 18 September Reply

    Just saw another movie on this topic. Tableland. Wonderful words from lots of farmers. Put a bit of perspective on it.

  • Christie's Corner
    Posted at 09:54h, 18 September Reply

    This issue is big enough to fill a book, so I was very nervous addressing it in a simple blog post. But I'm so glad I did. Your answers have been amazing. So well thought out and intelligently presented.

    Thanks to everyone who commented. I am impressed with your insights, enthusiasm and knowledge.

    Civil, intelligent discussions like this make blogging worthwhile. Thanks so much for taking the time to share your thoughts. It's much appreciated.

  • danamccauley
    Posted at 10:19h, 19 September Reply

    I'm back again. Re Paul's comment:

    I was just listening to CBC radio one’s program THE HOUSE and Rubin was the guest. Absolutely fascinating.

    Even more interesting, is that the next few weeks that program is going to follow up on some of his hypotheses about globalization and explore them from other sides

    The programs will be available online live and as podcasts:

    http://www.cbc.ca/thehouse/audio.html

    I've posted this info on my blog and at Casual Kitchen, too.

  • Christie's Corner
    Posted at 09:17h, 21 September Reply

    Thanks Dana. I'm listening to this now…

  • aviva
    Posted at 20:56h, 02 October Reply

    Great post, Charmian. It’s distressing that agribusiness in North America has created a dependence on cheap, low-quality food. I also sympathize with your reader’s question and situation. I think we can all start by doing what we can — perhaps by buying a few things from a farmers’ market, even if we can’t afford to buy all our produce there. If everyone did a little, instead of going for the lowest-quality stuff at the lowest price, it would make a huge difference.

    • Charmian Christie
      Posted at 08:18h, 03 October Reply

      Thanks for weighing in, Aviva. I agree. Sometimes the little shifts make a big difference.

      Ironically, although the Farmers’ Market can cost a bit more at times (and can be less expensive in season), the food usually lasts longer in the fridge because it’s so fresh. That translates to savings, too.

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