Tuesday, July 31, 2007

Is Local Food Cheaper?

You'd probably not get much argument if you claimed that fresh, locally-grown produce from the farmer's market tastes better than large-scale agribusiness produce picked unripe and shipped across the country or even across the ocean and sold in your nearby chain grocery. But, what if you claimed that the local produce was also a heck of a lot cheaper? It seems so counterintuitive that you'd been tempted to reject it outright with a wave of a hand, or at least I would.

The reason for the demise of small, local farmers, I've thought all along, is that with the industrial-farmed stuff shoppers get the benefit of cheaper prices due to economies of scale. In addition, because of transport from distant warm climates, fresh (or, at least, non-canned and non-frozen) vegetables and fruits are available any time of the year--breaking the tyranny of the seasons and putting in place a distribution network that can generate revenue twelve months out of the year rather than just during a seasonal harvest. The trucked-in stuff may not taste quite as good, but the cost savings more than makes up for it for the average consumer.

That was my theory, at least. Recent observation and reading is making me wonder something: could it be that small-scale, local produce is actually cheaper than the stuff you get at the supermarket? Could it be that the average shopper is paying a good bit more for a tomato or a cucumber that doesn't taste nearly as good as the real thing? Advocates of "eating local" have recently come under criticism that claims the philosophy is inherently elitist, a luxury available to those who have the extra income necessary to indulge in higher-priced specialty varieties. Could it be that the critics have it exactly backwards?

Sam Breach over at Becks & Posh raised alot of these questions not too long ago when she compared the prices from San Francisco's Ferry Plaza Farmers' Market to those at Safeway and found the farmer's market to be consistently cheaper. There's an obvious explanation for this. At a farmer's market you are cutting out the middle man, so one would expect to see lower prices. But, at the same time, the supermarket is providing the added convenience of a big parking lot, a deli with fried chicken, and many other niceties. The farmer's market (in Charleston, at least) is where you go on the weekend when you don't mind taking a while to park and browse around the various vendor stalls and take time picking out food. It's not where you go when you are racing home for work and need to pick up just a couple of things (including toothpaste, beer, and baby diapers in addition to some veggies for dinner). The farmer's market won't scale.

The overhead for a farmer's market vendor is pretty low (compare the lease on a market stall with an anchor-tenant spot in a strip mall), and the savings gets passed on to the consumer. What you are paying for in the supermarket is the convenience of getting everything in a single place, and with nice shopping carts and bagboys to boot. So, while the supermarket can "leverage economies of scale" to save on their cost of "sourcing" their vegetables (to sling a little lingo), they also have a lot higher overhead than their hippie competitors down at the farmer's market.

But the same effect seems to apply not just at outdoor markets but at regular 7-day-a-week specialty shops. Why is fresh, locally-caught medium shrimp at Mt. Pleasant Seafood on Shem Creek only five bucks a pound when in the local supermarket it's seven and at Whole Foods (aptly nicknamed "Whole Paycheck") it's up over ten? How come the Boone Hall Farms market can sell a locally-grown green bell pepper for 33 cents when it's $1.19 at Bi-Lo? I'd noticed such disparities in passing, but it's hard to extrapolate a trend for just a few random points of data--perhaps the only reason the lower cost of local stuff even caught my eye was that it was the unusual exception to the rule?

In the interest of science, I've conducted a little research, and here are the results of my price comparison between a basic slate of produce at Publix (the supermarket chain) and at the locally-owned Boone Hall Farms' produce store, which sells a lot of fruit and vegetables raised right here in Mount Pleasant on their large working farm. All the items on the list were selected prior to visiting either store, with an eye to selecting those vegetables I knew could be locally grown and were in season:

ProductBoone Hall Farms Publix
Cucumbers:$.33 each$.65 each
Red potatoes$.59/lb.$1.29/lb.
Green beans$.99/lb.$1.49/lb.
Sweet corn:$.40/ear$.50/ear
Yellow onions:$.59/lb.$1.29/lb.
Yellow squash:$.99/lb.$1.49/lb.

Across the board, the local farm store is consistently less expensive than the supermarket--ranging from 20% less to almost a third the price.

The real question is how much of this is the "local effect" and how much is due to different overhead costs. So, to try to tease that out, I compared the prices of a slate of produce that were definite NOT local:

Green leaf lettuce:$.99/each$1.49/each
Dole bananas:$.49/lb.$.49/lb.
Granny Smith apples:$.99/lb.$1.99/lb.

The results here are a little less conclusive, but it appears that the local farm market store may run a little cheaper than the supermarket, but not significantly so.

This is all very unscientific and just a preliminary survey, but based upon these figures I would hazard a hypothesis: fresh, locally-grown fruits and veggies are actually cheaper--significantly cheaper--than the nationally- and internationally-imported produce sold by your typical supermarket--at least when it is in season.

Which leads me to believe that it wasn't price at all but rather the convenience of being able to buy tomatoes in January and bell peppers in March that led us down the road of accepting the substandard quality of the long-haul version over the local, freshly-picked item. We would gladly pay twice as much for a tomato in January as we would in July, even though the flavor wasn't nearly as good--it was better than not having the tomato at all. And after a while we forgot how delicious and inexpensive local tomatoes were when they were in season and just kept buying them at the supemarket at the same consistent price year-round.

That's my working theory, at least.

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