September 23, 2020

Boom or Bust Time

Creative selling and and a spike in CSA orders are lifting the spirits of local farmers — but will it be enough to buoy their ledgers?
By Craig Manning | May 9, 2020

What do you do if your favorite restaurant is closed, and you’re wary about wandering into a grocery store? For many local households, the answer has been to rely more heavily on northern Michigan farms.

While the North’s agriculture industry is facing its own challenges and uncertainties right now — restaurant demand has shrunk significantly, and farmers markets are unlikely to return in their usual in-person format any time soon — many small farms have seen huge growth in their direct-to-consumer sales since COVID-19 impacted the United States. The Northern Express reached out to a dozen local farmers to find out how they’re weathering the pandemic, what they’ve done to pivot their selling strategies — and if the changes will be enough to keep them profitable.

INITIAL IMPACT
Although it’s early in the pandemic and the planting season, COVID-19 is already making an impact at local farms — some more than others. One example is Leelanau Peninsula’s Loma Farm, which grows vegetables, herbs, and small fruits. According to owner Nicholas Tyson, 80 percent of Loma’s revenues come from wholesale accounts, including grocery stores and especially restaurants. The farm’s local produce helps form the backbone of many farm-to-table menus in the area, from Alliance in Downtown Traverse City to The Tribune in Northport to The Boathouse on Old Mission Peninsula. Since COVID-19 has forced restaurants to shut down their dining rooms and pivot to takeout (if not close entirely), that substantial segment of Loma’s business is in doubt.

“It's hard to say right now [how hard COVID-19 will hit us], because it's still early in the year for a vegetable farm,” Tyson told Express. “Nothing is growing outside yet. Our season is really May through December or January. So, it’s hard to know where we stand. If all the restaurants that are closed right now are still closed in June, we're going to feel it. It's really going to hit us hard.”
Even for farmers who don’t rely on the local restaurant scene to make the lion’s share of their profits, the pandemic has created unforeseen roadblocks. Outside of wholesale accounts like restaurants and grocery stores, a huge source of revenue for area farms is the local farmers market scene. Each Wednesday from June through October, dozens of farmers from throughout the region flock to Parking Lot B in Downtown Traverse City for the Sara Hardy Downtown Farmers Market.

The Village at Grand Traverse Commons also hosts a weekly farmers market throughout the year, including an indoor market at The Mercato that runs from November through April. But The Village indoor market closed down early this season due to COVID-19, and Traverse City’s Downtown Development Authority (DDA) — which operates the Sara Hardy Downtown Farmers Market — has postponed all in-person events until at least June.

REDIRECTING MARKET TRAFFIC
The DDA is attempting to ease the blow of a month’s worth of missed farmers markets by taking the Sara Hardy market virtual. The online marketplace can be found at sarahardyfarmersmarket.localfoodmarketplace.com and allows customers to purchase much of the same produce, dairy, eggs, meat, and honey that they would find at the market in-person. Ordering for each week closes at 10am on Thursdays, and product pickups are scheduled for each Saturday at Parking Lot B.

For various reasons, some local farmers are frustrated about the DDA’s decision to postpone the start of in-person farmers market events. One example is Reid Johnston, who owns the Cedar-based Second Spring Farm. Johnston, whose farm relies on farmers market events to make the majority of its direct-to-consumer sales, believes that canceling the Sara Hardy market doesn’t make any more sense than closing down local grocery stores would.

“We feel that the market should be treated as any other grocery store,” Johnston said. “Being open-air, we feel it is potentially an even safer environment to shop in.”

Chelsea Huddleston, meanwhile, takes issue with the virtual farmers market for a different reason. Huddleston and her partner, Traverse City native Nick Olson, moved to northern Michigan from Pittsburgh in December and established Huddleson Farm in Kewadin. The two were counting on the Downtown Traverse City farmers market as a way to engage with customers face-to-face and introduce their brand to a wider audience. Huddleston says that an online market, while better than nothing, does not provide the same opportunities for growing a customer base.

“It's a tough situation for a first-year farmer,” Huddleston said. “We don't have the name recognition where people are going to go to our website or go to the Farmers Market website and feel loyalty to the Huddleson Farm brand. So we don't really anticipate a lot of success there.”

Throughout the shutdown, the Boyne City farmers market has maintained a list of its winter market vendors, along with contact and ordering information for each able to fulfill orders, on its Facebook page and here. Starting May 16, 8am–noon, it will open its usual spring market, but with some significant changes: Only one single masked shopper per family is allowed to enter, make their selection and exit, and everyone is highly encouraged to place their orders in advance.
 
Leelanau Farmers Markets — hosted in Empire, Suttons Bay, Glen Arbor, Northport, and Leland — has not yet announced how the markets will open but indicate they will; the group has been accepting vendor applications and all but Suttons Bay have pegged opening days in June. The organization is requesting shoppers consider donating $25 to become a Friend of the Market to help adapt and open in a safe and timely manner. The Downtown Gaylord Farm Market is sticking to its traditional Memorial Day weekend opening, May 23 this year, but like with many farmers market around the region, details aren’t yet available.
 
UNEXPECTED BOON
One area where most local farms are seeing a surprising amount of success is with their community supported agriculture (CSA) programs. A CSA program allows a customer to make an upfront lump sum investment in a local farm at the outset of the season. These programs are good for farms because they provide a stimulus of funds during the beginning of the growing season — a time when farmers’ costs are high and income is low. In return, customers who buy a CSA membership (or “share,” as it’s referred to in the industry) receive weekly shipments of produce from the farm they elected to support, usually at a discounted rate.

Many local farms have offered CSA programs for years, but most have never seen as much demand for those programs as they have this spring. Adam Brown, who co-owns UnderToe Farms in Kewadin, says his farm has been selling out of its last winter storage crops and has nearly doubled its number of summer CSA memberships compared to last year. Kelly Doyle of Daybreak Dreamfarm in East Jordan says her farm expanded its CSA program by 10 slots this year and still sold out quickly. Huddleson Farm and Loma Farm have both sold out their 2020 CSAs as well.

“We decided that we would expand the CSA program from 50 slots to 75 this year, which has not been difficult,” Tyson said. “There has been demand that we have never seen, especially so early. Generally, we have about half of our CSA shares sold by the end of April, and people trickle in after that. Our CSA starts the first week of June, and we're usually sold out by that first pickup. But this year, April has seen just a ton of CSA sales, and a lot of them are coming from people we don't know. It's not just people who have been members in the past, or who shop with us at the farmers market. We've had a lot of inquiries and a lot of purchasing from new people, and it's pretty unsolicited. The only place that we really put the word out about the CSA is on our website.”

When asked why she thinks CSA sales have skyrocketed the way they have this spring, Doyle points directly to COVID-19. By closing restaurants, the pandemic has forced more people to stay in and get creative with their own food prep. By devastating the economy, it’s encouraged a groundswell of pride and support for local businesses. By creating fear of heavy-traffic public spaces, it’s left people eager to minimize their trips to the grocery store. All these factors (and others) make a program that delivers weekly fresh produce that much more attractive.

“We're seeing a great trend toward local food right now, and I'm optimistic that the trend will continue,” Doyle said. “The sentiment that we've been echoing for years, about the importance of local food and local economy, is now really starting to settle into people's psyches, now that there’s some more question about long-term food security and more hesitation about walking into a grocery store. We've been really grateful — and a little overwhelmed — by the amount of demand we're seeing so early in the growing season, and it's really given us a lot of hope moving forward.”

NO STANDARD SHARE
Every CSA is a little bit different. Price points, delivery options, included produce, length of season, and overall program flexibility vary from one program to the next. The “Cream of the Crop” CSA program at 9 Bean Rows in Suttons Bay, for instance, is one of the most extensive available in the area, incorporating fresh fruits, veggies, herbs, salad greens, eggs, and fresh-baked bread. UnderToe Farm this year added a “support a family in need” program to its CSA, allowing customers to send fresh produce boxes to households in need. Huddleson Farm is differentiating itself by offering a flexible “gift card” CSA model — one that allows members to select the types and quantities of produce they want each week, skip shipments without penalty, and customize their investment more fluidly.

While many local CSA programs have already sold out for the 2020 season, numerous other farms still have shares available. Second Spring Farm, Providence Organic & CSA (located in Central Lake), and the Traverse City-based O’k CSA Cooperative are all still open to new members, as is Petoskey’s Bear Creek Organic Farm, which offers an annual membership program that is similar to a CSA. Other currently sold-out CSAs could potentially expand as the season moves forward, depending on how quickly the economy opens up again post-coronavirus. Tyson, for instance, says he initially planned to double his CSA program to 100 shares this year — and still could, if restaurant business remains slow into the summer.

“I kind of got cold feet about doubling the CSA, because I really don't want a scenario where restaurants open — those long-term partnerships that we've had — and we don't have the supply to serve them,” Tyson said. “And so I'm willing to take a bit of a risk by keeping CSA numbers a little lower for now. However, I don't think we'll have any problems selling shares come June if restaurants still aren't open.”

BUT WILL IT BE ENOUGH?
Despite the major growth of interest for CSA programs, farms aren’t immune to the economic blow that COVID-19 has dealt. Restaurant sales and farmers markets remain two huge pillars of business for the small-ag industry, and without them, the coming months could be rocky for some local farms — even if direct-to-consumer sales remain on the rise.

“The minor increase in CSA sales that we’ve seen won’t come close to the loss in revenue we will experience if the farmers markets don’t open back up,” Johnston said, of Second Spring Farm. “Even then, the social distancing measures that will likely be enacted [at markets] will not be conducive to the volume of sales that we are used to doing in the past. We stand to lose a lot of revenue. And unfortunately, due to the seasonal nature of farming, we already incurred the majority of our costs for the growing season — in the way of inputs like seed and fertilizer — before COVID was a reality. The future of Second Spring Farm is definitely in peril.”

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