RD76 - Annual Report on the Virginia Farmers Market System 2014 Report and 2015 Plan - January 2015


Executive Summary:
This report complies with § 3.2-3501 B. of the Code of Virginia which requires the Commissioner of Agriculture and Consumer Services to submit a report by February 1 of each year to the chairmen of the House Committee on Agriculture, Chesapeake and Natural Resources; the Senate Committee on Agriculture, Conservation and Natural Resources; the House Committee on Appropriations; and the Senate Committee on Finance. The report summarizes the market operators’ reports and plans for the farmers' markets operating pursuant to a contract between the Commissioner and the market operators during the preceding calendar year.

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

• The Southwest Virginia Farmers Market (SWVFM), Hillsville, is operated by the County of Carroll.

• The Eastern Shore of Virginia Farmers Market (ESVFM), Melfa, is operated by the Eastern Shore Marketing Cooperative, Inc.

• The Northern Neck of Virginia Farmers Market (NNVFM), Oak Grove, is operated by the Northern Neck Vegetable Growers Association.

•The Southeast Virginia Farmers Market (SEVFM), Courtland, is operated by Farmers Market, L.L.C.

In 2014, the Virginia Farmers Market System recorded an all-time record high of $44.6 million in sales, a 12 percent increase over the $39.8 million in 2013. While the value of sales set a record in 2014, the individual markets face functional obsolescence without major capital improvements to replace aging infrastructure, meet modern food safety compliance standards and improve operational efficiencies. In order to continue operating, packing facilities such as the farmers markets are under pressure to make significant capital investments to improve packing lines, cooling facilities, and ice machines as well as purchase/update software and other equipment related to product traceability. Each market requires capital improvements to meet modern food safety compliance standards that are becoming the norm in the produce industry.

It was determined that the Commonwealth was not in a financial position to invest in major capital improvements at the markets, and the private operators of the markets are unable to secure financing for major capital improvements to properties that are state owned. One solution put forth to address this issue was the possible sale of certain markets. During the past year, the Department of Agriculture and Consumer Services received authorization to sell the NNVFM and the SWVFM. The NNVFM is currently listed for sale with a commercial real estate broker. The SWVFM is in the process of executing deed restriction provisions prior to being placed in the commercial market.

The numerical breakdown of sales and clients served by the Virginia Farmers Market System in 2014 is as follows:

• The markets served 8,773 acres of production in 2014, which was slightly below the 2013 acreage of 9,280.

• The system served 32 brokers and 681major retail stores and institutional buyers, which was slightly higher than the number of brokers and buyers in 2013.

• A total of 270 producers marketed product or used market services at the four markets. The established goal was 227 producers for 2014.

• Gross value of products marketed was $44.6 million, representing 3.6 million product units as compared to $39.8 million in 2013, representing 3.01 million product units.