RD94 - Annual Report on the Virginia Farmers Market System 2007 Report and 2008 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 entity and will be under new management in 2008.

For the 2007 harvest year, volume (units sold) was down 5 percent while the value of produce handled was up 5.6 percent when compared to 2006. Statistically the breakdown is as follows:

• 103 producers marketed product and/or used market services at the four markets (combined), compared to 270 producers in 2006. This drop in producer users can primarily be attributed to the Southwest Virginia Farmers Market, where three large wholesale tenants left the market in 2007. These wholesale tenants were served by a large number of contract growers that serviced only these three accounts.
• Gross value of products marketed through the system increased to $22.7 million, representing 2.38 million product units, compared to $21.5 million in 2006, representing 2.51 million product units.
• The markets served 5,715 acres in 2007, compared to 6,631 acres in 2006.
• The system served 47 brokers and 312 major retail stores and institutional buyers, compared to 60 brokers and 391 retail stores and institutional buyers in 2006.

Several factors affecting production and marketing volumes were cited by the market operators in 2007. Positive factors included:

• Virginia producers are showing a willingness to diversify their vegetable production, both in terms of product mix, varieties, and volume, thereby, better serving customer demand while also spreading production risk.
• Higher prices were received for some fruit and vegetable crops, due to lower than normal supplies brought about by the late spring freeze and the summer drought.
• Production meetings and grower educational sessions were held in regions served by all markets during winter months to educate growers on market demand, production recommendations and techniques.
• The Southwest Virginia Farmers Market is transitioning from a market that was primarily serving wholesalers catering to smaller stores, restaurants, and other wholesalers to one that is packing and shipping to chain stores and to companies that supply them.
• Representatives of the Northern Neck of Virginia Farmers Market attended the Produce Marketing Association Annual Meeting held in Houston, Texas and promoted the region’s vegetables while assisting in the staffing of the VDACS Virginia Grown exhibit.
• The Eastern Shore of Virginia Farmers Market continued as an agricultural service center. The cooperative operator manages the wholesale market, as well as the Southeastern Potato Committee, which manages the USDA Marketing Order that allows potato producers to export product to Canada.
• The Eastern Shore Farmers Market is attempting to meet the needs of both the small grower, whose numbers and acreage are declining, and the larger corporate grower, whose acreage is increasing, by leasing space to a large tomato operation and also to a year-round broker who buys locally.

Negative factors cited by market operators in 2007 included:

• Unfavorable weather conditions, which began with a late spring freeze and was followed by extreme heat and drought during the summer and early fall, reduced yields on most fruits and vegetable crops.
• Increased fuel and input costs continue to have a negative impact on profitability.
• Wholesale product buyers are fewer in number, as a result of consolidations and closures.
• Continued slow economic recovery in some regions of the state.
• Due to difficulty in recruiting local labor, vegetable growers in most regions are dependent on migrant labor.
The availability and high cost of migrant labor, as well as the migrant housing requirements continue to be issues of concern.
• Warm temperatures caused crop maturity convergence in several production regions of the East Coast, causing some harvest gluts and lower prices at times during the growing season.
• The traditional row crop culture and higher prices for crops, such as corn and soybeans have made it difficult to attract new growers or get additional acreage grown for the Southeast market.
• The booming real estate market on the Eastern Shore and the resulting higher prices of land have made it virtually impossible to acquire farmland for purely agricultural use. The higher prices for land have also driven up the rental rates of acreage for farming. These factors along with a production shift by many growers from vegetables to increased acreage of corn, soybeans, wheat, and to a lesser extent cotton.