So far in the Flaws in the Food System series, we’ve explored how many of the food system-related issues that re-emerged in 2020 revealed truths about what we in the U.S. value and what role farmers and local markets play in our lives in and out of times of crisis. And regardless of any natural, climate, economic, or public health disaster that may occur, a farm is a business that needs to maintain production and sales to remain in operation.
Small and mid-scale family farms that sell directly to customers and local markets faced unique impacts and uncertainties due to the COVID-19 outbreak, just as many were starting their growing season. For many, these impacts involved an immediate need to pivot what farmers were producing, who they were selling to, and how they were getting their products to customers in order to keep the farm running through the pandemic. For a farmer like Dave Pflugfelder of CATHIS Farm who focuses on buying and selling within his local and regional food system, adaptability and innovation during the pandemic kept the family farm alive. But still, many of the unique challenges Dave faced while pivoting his operations and sales represent larger limitations in the food system that can restrict the overall success of small and mid-scale farmers.
CATHIS Farm
Dave Pflugfelder grew up on his family’s farm in New Jersey where they raised cattle, grew corn, and kept egg-laying chickens. He later joined the military and was eventually stationed at Fort Bragg. He and his wife enjoyed the area so they purchased a farm in Lillington, NC, and began homesteading. After leaving military service in 2014, Dave began farming full-time. CATHIS Farm focuses on raising heritage-breed pastured pork and non-hybrid chickens for eggs and meat using sustainable farming techniques. Dave sells his farm products through local farmers markets, restaurants, local grocery stores, and direct-to-consumer sales.
The outbreak of COVID-19 threw a giant curveball for Dave and CATHIS Farm. Their original plan for 2020 included an expansion of pastured poultry production, up to 100 whole chickens per week to be sold to restaurants. But by March all of those restaurants, making up about 50% of his total sales at the time were shut down. However, in that same month, Dave said, “people started finding us like crazy” and buying as much as they could get their hands on directly from CATHIS Farm. “People were buying four whole chickens at a time.”
And Dave was not alone in seeing a surge in customers wanting to buy their food directly from their local farm due to low inventory and safety concerns at grocery stores. Many other small-scale, direct marketing farmers saw unprecedented demand for their products in early 2020. But while an increase in customers seeking farmers out to buy food may seem like an automatic win, it did not come without its own challenges.
Limitations within Small-Scale Meat Production
It’s not uncommon for small livestock producers like Dave to struggle to find local meat processing facilities that will take smaller volumes of animals and process the meat into various value-added cuts, e.g. boneless chicken breasts. The capacity of meat processing facilities dramatically worsened during the pandemic as the sudden uptick in panic purchasing of meat meant that many farmers and larger meat companies needed to process more animals in order to keep up with customer demand. “I used to call a couple of weeks ahead of time if I had pigs to process. But last summer I booked appointments for all the animals I planned to raise. I am only now getting to the end of those dates. And one beef processor I spoke with was only taking dates two years out.”
Even if Dave had an appointment at the meat processing facility, there was an additional complication that the facility only had the capacity to process half of his chickens into smaller cuts. This was not as much of a concern while Dave was selling to restaurants as chefs are content to purchase whole chickens. However, when CATHIS Farm’s customer base shifted to almost all direct-to-consumer sales, the market demand for whole chickens fell. “Now I can’t keep up with having enough chicken cuts in stock but I have a backlog of whole chickens. It’s just too labor-intensive for the small-scale processors to make all the cuts I need.” Dave is also prevented from further processing the whole chickens into cuts himself on-farm due to food safety and USDA meat inspection restrictions.
So even though CATHIS Farm saw unprecedented demand for their meat and eggs in early 2020, they couldn’t sustain it because the local food system infrastructure wasn’t in place to support the needed changes in production and marketing. The limitations Dave ran into also applied to other areas of production, like low to no supply of chicks and feeder pigs as well as higher feed costs.
COVID-19 Aid for Local Farmers
As farmers across the country dealt with the uncertainty and strain of adapting or pivoting their businesses, several federal aid programs became available. The Economic Injury Disaster Loan (EIDL) and Paycheck Protection Program (PPP) were two options available to farmers through the Small Business Administration. The USDA also opened a direct payment program, the Coronavirus Food Assistance Program (CFAP), in the summer of 2020 to help producers recover losses suffered due to market price decline and overall disruption.
The federal aid programs provide another example of how small-scale farmers who sell to local or regional markets can miss out on opportunities available to bigger producers. While Dave applied for the CFAP direct payment, the program didn’t provide a meaningful benefit to him. The method of calculation used to determine farmers’ payment amounts was based on the fair market value of a commodity. The market value of a broiler chicken — a chicken that is mostly raised in a building with thousands of other chickens and owned by a major agribusiness — is far, far less than a heritage breed chicken, humanely and pastured raised on CATHIS Farm. And Dave’s costs of production and prices reflect that higher value. “I got pennies [from CFAP] because it was based on commodity prices. But my cost per chicken is 10 times higher than a large-scale producer — same with hogs. The payments were great if you had thousands of acres or animals. For me, it was something, but not much at all.”
RAFI-USA knows that farmer aid programs like CFAP aren’t always designed for producers like Dave. And small business aid programs like EIDL and PPP aren’t always designed well for farmers in general. For this reason, RAFI-USA launched the COVID-19 Emergency Relief Grant program in April 2020. RAFI-USA distributed $500 grants to more than 130 North Carolina farmers to help fill in the gaps of federal aid. Later that spring RAFI-USA awarded another 45 relief grants to farmers across five Southeastern states and the U.S. Virgin Islands. And for farmers who experienced delayed or prolonged effects of COVID-19, we released a final round of grants in March 2021 to 50 farmers across the Southeast.
All in all, RAFI-USA distributed around $118,000 in relief grants to more than 200 farmers in the last year and a half. The funds assisted farmers who were experiencing financial stress due to sudden losses of customers, closed agritourism operations, labor shortages, unexpected costs, and other disruptions. Dave was one of the recipients of the grant program. When CATHIS Farm’s customer sales dramatically slowed following the peak months of March and April 2020, the grant funds were used to cover necessary household costs. “It covered expenses down the road when we really needed it.”
What Lies Ahead
Over a year after the COVID-19 outbreak, CATHIS Farm is still dealing with a very different business landscape. “The most obvious is the lack of restaurant sales. Even the restaurants that have reopened are much more price-conscious now, and I can’t compete on prices anymore.” With a backlog of whole chickens, Dave is also faced with the challenge of figuring out a new market or customer base for his existing and future inventory.
But there’s also a positive outlook in 2021. Dave has noticed that his 2021 sales are actually more consistent and higher than they were in the first half of 2020 — even with the sales spike in March and April. “We have definitely gained new customers on the direct market side. I think customers were on the fence before and now they have a better appreciation and they want a better product.” It seems that so far in 2021, customers are willing to spend a little more on their food in order to support their local farm and access quality food. “It’s a pleasant surprise overall.”
COVID-19 presented challenges for all farmers but those who produce on a smaller scale or those who sell to local and regional markets particularly struggled due to a national food system infrastructure and safety net designed not for them but for large-scale commodity producers and agribusinesses. A farmer’s success is not only dependent on growing a crop or raising an animal. A farmer needs reliable and affordable access to feed, fertilizer, processing, storage, transportation, and much more in order to be sustainable and make a living. As Dave explains, “Being sustainable applies to the animals, the business, the farm; the whole thing has to work. I just can’t have a beautiful farm and lose money hand over fist.”
That’s why Dave is so passionate about farming and teaching people about what he does. He is always willing to talk with customers about why they farm the way they do and why their product is different and has a different price tag than what someone might find at a grocery store. He also says that customers should support local farmers, but be patient. “I can’t provide every customer with all boneless chicken breasts. The animal is more than one cut.” But when customers are able to support Dave as their local farmer, he is able to support local businesses as well. “CATHIS Farm’s whole supply chain supports small, local businesses within a three-state region. Supporting local supports the whole infrastructure and helps the local economy.”
RAFI-USA continues to advocate for COVID-19 relief programs that address the losses and additional expenses incurred by local, small-scale farms. If you are a small-scale livestock producer who struggles with access to adequate meat processing or other food system infrastructure, we encourage you to reach out to us so we can advocate for changes in local and regional food systems that support independent and viable local meat production. Contact Margaret Krome-Lukens at [email protected].