New effort gives ‘Ag of the Middle’ a boost

The Northwest is blessed with a diverse agriculture sector, both in terms of the crops and livestock that are produced and the scale of the operations that produce them.

Large, commercial-scale farms generally feed sophisticated supply chains with mature systems that take their raw commodities, deliver them to processors and turn them into numerous finished products that are marketed and sent on to retailers. Their business depends on economy of scale.

The growing number of small-scale farmers, mostly part-timers, produce for retail consumers. They market to the final user through a simple, direct supply chain — farmers’ markets or CSAs (community supported agriculture). Not very complicated, no need for extensive infrastructure or sophisticated marketing plans because the business rests on one-on-one relationships.

But what of the medium-sized farmer and the artisan producers? They may raise too much to sell on the farmers’ market circuit, too little or are too specialized for the mass market. They need more distribution infrastructure and marketing support than smaller operations, but lack the scale to participate in established supply chains. Some have their own brands and don’t want to throw in with others in a regional or national effort.

A study produced last month by Ecotrust explores the opportunities and challenges of those producers — what it calls the “Ag of the Middle.”

“In slightly abstracted terms, Ag of the Middle producers are those too small to compete in commodity markets, and too big to participate exclusively in direct to consumer channels such as farmers’ markets; what we now describe as ‘local values, wholesale volume,’” the report says.

It’s an interesting read. Though focused on the needs of Oregon producers, it advances ideas that could significantly increase the viability of these operations throughout the Northwest and expand the regional economy.

The 250-page study describes a haphazard system in which growers and other food producers spend too much time on the supply chain instead of developing their product. They must cobble together outlets, pick, pack and store things themselves and deliver small amounts to multiple buyers.

The report says Ag of the Middle producers often lack branding or marketing strategy and do without communications and strategic planning. The result is a system that is “highly fragmented, lacking consistent data and information, and dependent on personal relationships,” according to the study.

Simply put, among the things producers need to do are establish shared infrastructure — processing, storage, distribution and marketing; promote interdependencies between diverse producer sectors that could expand everyone’s business; and find ways to get or appear bigger to take advantage of scale.

To that end, Ecotrust is retrofitting a Portland industrial building to be a food development, storage and distribution hub that will put some of the ideas to the test. It will have 16,000 square feet of development, incubator or processing space for meat, grain and greens.

This is one of the more exciting concepts we’ve seen to expand the ag economy. We wish them well, and hope a working example of the concept will lead to imitation.

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