RD83 - Annual Report on the Virginia Farmers Market System -- 2004 Report and 2005 Plan


Executive Summary:
The Virginia Farmers Market System includes four shipping point farmers markets, each operating under a contract between the Commonwealth of Virginia and private sector and/or county government organizations:

• The Southwest Virginia Farmers Market, Hillsville, is operated by the County of Carroll

• The Eastern Shore of Virginia Farmers Market, Melfa is operated by a producer cooperative

• The Northern Neck of Virginia Farmers Market, Oak Grove is operated by local vegetable producer association

• The Southeast Virginia Farmers Market, Courtland is operated by local vegetable producer association

For the 2004 harvest year:

• 284 producers marketed product and/or used market services at the four markets (combined), compared to 280 producers in 2003

• Gross value of products marketed was over $23.05 million representing over 2.08 million product units, compared to $14.298 million in 2003

• The markets served 5,854 acres in 2004, compared to 7,087 acres in 2003

• The system served 55 brokers and 463 major retail stores and institutional buyers, compared to 68 brokers and 444 retail stores and institutional buyers in 2003

Significant factors affecting production and marketing volumes for the past year as cited by the market operators in 2004 were, on the negative side:

• Extreme weather volatility with a cold wet spring followed by four mid to late summer tropical storms and remnants from those storms

• Continued increase in buyer trends toward purchasing local produce which enhanced more local marketing and sales opportunities, thus decreasing the need for sale to wholesalers

• Slow economic recovery in some regions of the state

• Continued produce buyer consolidations resulting from mergers and buyouts, a trend that shows no sign of ending

• Tighter competition, particularly from other domestic and international supplier sources, another continuing trend

• Market windows growing more narrow, thereby stopping or compressing product movement

• Increased input costs due in large part to increased fuel costs (a key factor to watch in 2005)

• Ever changing consumer demand on product mix and varieties

• Continued downward trend producer numbers and acreage, "suburbanization" of production areas is becoming a key factor

• Labor continues to play a significant role, two of four markets report that their producers use migrant labor. Labor supply and housing consume an extraordinary amount of time for two of the system's markets (Eastern Shore and Northern Neck)

On the positive side:

• Higher produce prices due to extremely limited supplies

• Virginia producers continue to be adept at changing both the volume and varieties of their product mix to meet consumer demand

• Production meetings and grower educational sessions are held in regions served by all markets during winter months to educate growers on market demand and production techniques

• Good Agricultural Practices (GAP) and Food Safety Training Workshops were held in several market areas to enable markets and producers to attain consistent product quality and food safety standards which are being required by an increasing number of wholesale buyers

• The Eastern Shore of Virginia Farmers Market continued as an agricultural service center. The cooperative operator operates and manages the wholesale market and manages the Southeastern Potato Marketing Committee. Eastern Shore's cotton gin, Shore Gin & Cotton, Inc., renewed a lease on one brokerage office on the market site and outside management will oversee cotton ginning operations

• The Southwest Virginia Farmers Market has traditionally served as a traditional wholesale regional product operation in season and brokered non-regional product out of season. Tenants on the market have been able to improve regional producer's ability to enter the marketplace by maintaining a year-round presence in the marketplace

• The Northern Neck of Virginia Farmers Market moves a moderate amount of non-regional product in early spring prior to Virginia's harvest season

• The Southeast Virginia Farmers Market, designed to serve producers in Southeast Virginia and Northeastern North Carolina, entered into a new contract for market operator in November, 2003; 2004 represents their first full year of operation.