[Guest Post] At What Cost? Food Hubs, Walmart, and Local Food

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This is a guest post from our friends at the Appalachian Sustainable Agriculture Project (ASAP). To visit the original post, click here.

At What Cost? Food Hubs, Walmart, and Local Food

By Charlie Jackson and Allison Perrett
March 26, 2014

It is generally recognized that we have big problems with our food system. Industry and government policies and practices are concealed in an anonymous and largely unsustainable global economic system that degrades individual and community health, harms the environment, and is failing to sustain our farms and communities. In this pervasive global system, the effects of our food choices are hidden, and we are unable to see our impacts as consumers and citizens.

We are, though, at the emergence of a movement that holds the promise of transforming the way we produce and consume food. A movement to liberate food and agriculture from the control of impersonal economic forces, misguided policy, and corporate domination. This movement has the potential of empowering us as eaters and citizens to create a food system that is equitable, environmentally sustainable, economically viable, and health promoting.

While relatively young, the various efforts and activities that make up this emerging food liberation movement have seen tremendous growth in the last decade. As Michael Pollan noted in 2010 in the New York Times, the movement is, “… a big, lumpy tent, and sometimes the various factions beneath it work at cross-purposes.” To ensure that the “big, lumpy tent” observed by Pollan is working toward shared goals and objectives and avoiding the consequences that come from inadvertently working at “cross purposes,” there is a critical need to reflect and examine as we move forward. To achieve impact, the movement must learn and adapt as it continues to mature.

The leading front of the various efforts that are coming together to create this food movement, at least from the public perspective, is local food. Local food as a concept carries with it the aspirations of building resilient food systems that, through closer connections between producers and consumers, are responsive to the conditions and desires of the communities in which they reside. And in many cases and many places this is exactly what is occurring. But, as Branden Born and Mark Purcell warned in Avoiding the Local Trap, there is the danger of geography becoming a proxy for sustainability and a fallacy in assuming that by virtue of being “local” all of the other desirable qualities are inherent.

One prominent area of growth for local food over the last few years has been in the emergence of food hubs. Food hubs are a strategy to meet larger volume markets by aggregating and distributing local and regional “identity preserved” farm products from smaller producers. This idea is so appealing that it has increasingly come to dominate local food system building efforts and the direction of USDA and private grant funding. Currently, a great deal of effort, activity, and resources are focused on encouraging the development of food hubs as the way to “solve local.”

Food hubs have also attracted the attention and support of the world’s largest food industry players. Perhaps the biggest corporate supporter of food hubs is Walmart. In order to reduce “shipping costs,” Walmart has committed to purchasing locally grown food sourced from small and mid-sized farms. To accelerate the growth of food hubs, Walmart recently gave $3 million to support the Wallace Center’s National Good Food Network, a leading advocate of hubs, to further their work on food hub development.

Why is Walmart so interested in encouraging food hub development? Food hubs fit their corporate model and philosophy. They enable Walmart to reduce “local” to geography, to use local as a cultural shorthand for issues of social justice, environmental sustainability, and food access and as evidence of corporate responsibility.

Walmart needs this shorthand because they profit from poverty. They have achieved the status of being the country’s largest grocer by exploiting workers and driving down prices paid to producers. By virtue of their size, Walmart effectively dictates the wages paid throughout the food industry. Walmart is also the largest employer of people on food assistance, as well as being the nation’s largest redeemer of food stamps (see How Walmart’s Low Wages Cost All Americans, Not Just Its Workers).

Local Food Solved

For food hub proponents, food hubs “are the solution both to scaling up local food and ensuring its integrity.” The food hub approach aims to achieve volume through the aggregation of product from many small and mid-sized farms. Big retailers need large quantities of product, and they want to do business with a few, large suppliers. Local food, produced by smaller farms, can’t meet this need individually. The solution – pool production.

The problem with this line of reasoning is in the misunderstanding of how volume producers (and retailers) make money. It confuses scale with volume. Large producers specialize and spread out their fixed costs over large quantities of production – making profits of pennies on the pound but producing many, many pounds. Aggregating production from small producers cannot achieve the same result. Small volume producers can’t produce profitably on pennies per pound – they just don’t produce enough pounds. So food hubs might, by aggregating, achieve volume, but they rarely achieve scale. Food hubs need to pay their smaller scale producers more, particularly food hubs with environmental or social justice goals, but they still must compete in markets where price is determined by large scale production.

Walmart loves this food hub approach because it forces local food to compete on their terms – price. For Walmart and other big retailers, food hubs are the perfect solution to the “problem” with local food. It allows them to profit from interest in local but fit local into existing industry norms, effectively stripping local food of its transformative potential. Supplying product to these large volume markets, imbued with the halo of “local’ or “identity preserved,” does not challenge their standard operating practices, but instead provides them with cover (for an example, Walmart has used local food propaganda to argue for the building of stores in New York City after the city refused to let them in because of the low wages they pay their employees).

Moving the Movement Forward

The food movement has achieved a degree of success in even capturing the attention of Walmart and others of their ilk. Heart warming images and stories of family farmers abound in industry marketing now. The good news is that they know we are here. The bad news is they think we can be bought.

The job of the food movement is to move our friends and neighbors beyond the “local trap” to an understanding that food choices, the places we shop, and the way we engage civically matter and are central to creating change. As an approach to changing our food system, local food is not simply about geography, and it is not an end in and of itself. Through local connections and knowledge, local food is a way to facilitate the creation of the values that we want in our food system – values like fair pay, sustainable agriculture, healthy food for all, and resilient economies. Walmart wants geography, not values. They want us to want their food system. We need to be vigilant to defend the movement from the corrosive influence of money and the allure of being welcomed to the table of the powers that currently control our food system.

The dysfunction of our current food system is structural, pervasive, and ultimately social and cultural in nature. It cannot be “solved” through efficiency fixes – through infrastructure and technology. Aggregators and distributors of food have a place; they have been around for far longer than the the term “food hub”. There are self-sustaining “food hubs” that make the effort to ensure that retailers are not just using “local” as a marketing ploy and they are actively engaged to change the food system (see Walmart and the End of the Local Food Movement). But when, through nonprofits, government, and grant support, the cart of supply gets put in front of the horse of demand, we allow the existing food industry to dictate the terms of engagement. The work of the movement is not to “solve local” for the existing food industry, but to shift the entire discussion. We must bring the Walmarts of the world to the table on our terms.

As consumers at the register and citizens at the ballot box, we must demand a just and sustainable food system that includes not only the individuals that grow and transport our food, but also the stockers, cooks, and cashiers and the rest of the people that make up the majority of those employed in food and agriculture. Government and nonprofits need to be cautious about getting into the business of running businesses where success is measured in pounds. They need to make sure their investments are not just moving product, but moving people.

This is a critical time for the movement. It is time for the movement to define what it stands for. Is the movement about furthering the interests of narrow constituencies or is the movement about systemic transformation? Is the future of a sustainable and just food movement a collaborative effort with Walmart (and the likes of Walmart) or do we define ourselves by our opposition to the model they proffer? We need to be careful to not let the well-meaning efforts to build the infrastructure of local food get in the way of the deeper social change that will ultimately transform our food system. What we don’t need is to grow the movement only to end up looking like what we set out to transform. Walmart is not the answer, they are the problem.

About the Authors

Charlie Jackson is the Executive Director and founder of Appalachian Sustainable Agriculture Project (ASAP), one of the nation’s oldest local food advocacy nonprofits in the country. He has a MA in history from the University of Maine and nearly two decades of experience in local food system development. At ASAP he is a researcher for the Local Food Research Center, which is studying the social, economic, and environmental impacts of localizing food systems.

Allison Perrett is a program coordinator, an applied anthropologist and researcher with Appalachian Sustainable Agriculture Project. In 2013, she completed her PhD dissertation on a movement to build local food systems in the Southern Appalachians. At ASAP she directs research of the Local Food Research Center, which was launched in 2011 to study the region’s evolving food system and examine critically the social, environmental, and economic impacts of localizing food systems.

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