Many hard-pressed US farmers resorting to direct marketing. Skipping middlemen puts more cash, sooner, in producers' pockets
Livingston, Calif. — An agricultural revolution is taking place in this central San Joaquin Valley farming town. It's happening just off Highway 99, across the street from the Rocket Caf'e. There, at a once-abandoned gas station, broken windows and parking lot weeds have been replaced by new paint, ruffled curtains, and fruit, nuts, and vegetable displays.
The sign overhead reads: Yamato Colony Farmer's Market.
Yamato Colony, better known in these parts as the Livingston Farmers Association, is typical of the expanding number of US farmers who go directly to consumers or wholesalers with all or part of their crops.
They're skirting traditional middlemen, they tell you, because tough times demand it. The Yamato Colony will see several of its 75 members lose their farms in coming months, general manger Rick Kindle says.
In March the association began roadside retail sales of fruits and nuts, Mr. Kindle explains. Like other direct marketers, the Livingston group will still ship a percentage of its production through traditional channels.
Growers are attracted to direct marketing, says Joan Randall, a research associate in applied behavior at the University of California, Davis, because it gives them a say over their destiny.
``It's rare in the agricultural industry,'' says Ms. Randall, for growers to be able to say, ``This is what I want for my crop.''
Cash flow, she adds, is ``another attractive aspect'' of direct selling. It enables farmers to avoid waiting 30, 60, 90 days, or even longer for payment, as they must often do when dealing with traditional handlers.
``Nationally, direct marketing is becoming quite important,'' says the university's Roberta Cook, a cooperative extension market economist.
Dr. Cook says increasing numbers of farmers in California, Massachusetts, New York, Iowa, and parts of the South are using direct marketing to help beat the hard times.
Beginning at zero in the late 1970s, California growers pushed the total number of state-certified farmers' markets to nearly 100. (Figures for other types of direct marketers are not available.)
Convinced that farmers' markets are both culturally and economically important, some large metropolitan areas across the country actively promote their establishment.
One of the most aggressive programs is in New York, where communities wishing to establish markets get state assistance on site selection and other steps. The state offers a toll-free marketing hot line for buyers and sellers and publishes a directory which lists farmers interested in direct marketing.
Direct marketers of all types sold well over $100 million in crops and livestock in New York in 1985, up significantly from a few years ago, says Robert Lewis, the state's chief marketing representative.
Mr. Lewis says farmers' markets in his state number 125 today, up from 100 in 1980.
Three years ago, when Jim Hightower was elected Commissioner of Agriculture in Texas, no direct marketing cooperatives existed, and there were only a handful of farmers' markets. With Mr. Hightower's backing, that has all changed. Today there are 10 direct marketing co-ops and 50 farmers' markets. Thousands of farmers are involved.
The Valley Farmers Cooperative, located in the arid Rio Grande Valley of Texas, is an example of the key role of marketing cooperatives here. Born out of the economic hardships of its Hispanic members, the co-op gives producers marketing muscle they didn't have as individuals, says Robert Maggiani of the Texas Agricultural Department.
Historically, growers in the valley sold produce to area packing sheds in exchange for production and harvest loans. But as times worsened, growers couldn't pay off their loans. It became a vicious cycle, ``almost like they were indentured servants,'' says Mr. Maggiani.
Using money from Willie Nelson's Farm Aid Fund and relying on state expertise, the farmers set up their cooperative. Today, Maggiani says, produce from the co-op is shipped to some of the country's most important food handlers.
Cook says that as prices have cooled for traditional crops such as tobacco and peanuts, farmers in portions of the Deep South have begun looking to alternatives, like vegetables. As a result, direct marketing is beginning to boom in the region.
While direct marketing has its success stories, it is ``no panacea,'' says Bert Bussell, one of California's largest roadside ``pick your own'' operators.
The Bakersfield farmer says that although the grower receives a higher price with direct marketing, he also has many additional expenses. Depending on the form of marketing attempted, there can be transportation, employee, and processing costs commercial farmers don't have.