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AUGUST 19, 2021
MEDIA CONTACT: MELISSA CIPOLLONE (MELISSA@PASAFARMING.ORG)
HARRISBURG, PA — A new report offers the most comprehensive review of direct-market vegetable farm businesses to date, revealing sobering financial realities endured by farmers who sell their produce directly to consumers through farmers markets, community supported agriculture (CSA) programs, on-farm stores, and direct wholesale (without a distributor or other intermediary) to grocery stores, restaurants, and institutions.
Direct-market farms are the foundation of local food movements everywhere, yet there is surprisingly little information available to help answer a basic question: Can farmers make a middle-class income selling vegetables through direct-market outlets?
Pasa Sustainable Agriculture, a farming education and research nonprofit, launched an ongoing study in 2017 to help fill this critical gap in information and provide insights that could help vegetable farmers start and grow their businesses. Its new report shares detailed financial benchmarks from 39 direct-market vegetable farms collected over three years.
Participating farms were located in four Mid-Atlantic states: Pennsylvania, Maryland, Virginia, and West Virginia. Most had less than 15 acres in vegetables production; the largest had approximately 100. Farms studied had been in business for anywhere between one and 50 years.
“We found that the majority of direct-market vegetable farms were not earning a middle-class income,” said Franklin Egan, the study’s lead researcher and one of the report authors. Participating farms had a median net income of $18,500, which approximates the 2020 poverty rate in Pennsylvania for a two-person household.
The study did find some farms bucking the trend. A quarter of study participants had earned net incomes greater than the Pennsylvania median household annual income of $57,000. These farms tended to be larger in scale than many market-garden-style farms—typically, ten acres or more in vegetable production—and often capitalized on diversifying their revenue streams, with reselling products produced by other local farms proving to be one of the more profitable added enterprises.
“Many of the owners of high-performing farms partially attributed their success to good fortune—such as access to especially lucrative markets or reliable farmland arrangements,” said Egan.
The study also found that farms steadily increased income and equity over time, generally becoming more profitable the longer they were in business. Most farms’ net incomes exceeded the Pennsylvania median household income within 12 years of business, while accumulating equity in land, buildings, and equipment in the meantime.
Interestingly, no single direct-market channel consistently outperformed all others. Researchers found that all of the major sales channels utilized by farms in the study—farmers markets, CSAs, and direct wholesale—had a mix of higher and lower income cases.
“For farmers wondering whether or not to focus on selling their produce through particular direct-market channels, this finding indicates there isn’t a one-size-fits-all business model for financial success,” said Sarah Bay Nawa, who co-authored the report.
Researchers identified three primary pathways for improving direct-market incomes: increasing the number of acres in vegetable production, growing more and higher-value crops per acre, and developing more efficient production systems. Still, the land, labor, and capital needed to pursue these strategies are often out of reach for farmers who are operating at a loss or aren’t earning a living wage.
“While all farmers want to operate profitable, self-sustaining businesses, the financial benchmarks identified by our study are consistent with structural challenges that negatively impact small- and medium-scale farms in a highly consolidated agriculture industry,” said Pasa Executive Director Hannah Smith-Brubaker.
“Creating and expanding public and private partnerships will be necessary to help direct-market vegetable farmers continue their essential work providing fresh, nutritious food for their communities,” continued Smith-Brubaker. The report recommends these partnerships should focus on equitably increasing farmland access, improving market opportunities, encouraging workforce development, reducing financial risk, and rewarding conservation best practices such as building soil health, protecting wildlife, and improving water quality.
Pasa’s study is an ongoing project. Since compiling the findings detailed in its new report, the organization has partnered with peer organizations in New England and the Carolinas to expand the scope of its study to include data from vegetable farms located outside of the Mid-Atlantic region. Pasa will also be analyzing the impact the coronavirus pandemic has had on study participants.
Find the full report online here.
This study was initially made possible with investments from Lady Moon Farms, the Jerry Brunetti family, the Shon Seeley family, and more than 120 private donors committed to strengthening local and regional food systems. Additional support was provided by a Pennsylvania Department of Agriculture Specialty Crop Block Grant and a Pennsylvania Department of Agriculture Research Grant.
Want to join this study? If you are a direct-market vegetable farm and are interested in joining this study, email Pasa Sustainable Agriculture at email@example.com or call (814) 349-9856. Participating farms get custom financial benchmark reports and access to a learning community of their peers.
Pasa Sustainable Agriculture cultivates environmentally sound, economically viable, and community-focused farms and food systems. Learn more at pasafarming.org.