Small-scale farmers find dealing with large distributors can sometimes be culture clash

DAYTON, Va. — At the wholesale-produce market in this Mennonite community, farming families arrive by horse and buggy, and pallets are stacked high with freshly harvested Shenandoah Valley onions, corn, green peppers and squash.

The setting evokes a simpler, pre-industrial era. In reality, small-scale farmers are experiencing growing pains as they adapt to the country's expanding diet for locally grown foods and the exacting demands of high-volume distributors of their produce.

Companies such as Sysco, Whole Foods and Wal-Mart want guaranteed volumes, set prices for an entire season and the ability to trace produce back to its source in the event of a food-related health scare, among other things.

However, such standards, and other formal trappings of the business world — contracts, attorneys, technology — often conflict with the ethics, and practical considerations, of small-scale farmers, especially those who are deeply religious.

"They feel they are producing something as safe and secure as their relationship with the Lord," said David Watson of the Association of Family Farms.

Moreover, growers in temperate climates don't have a 12-month supply of produce. "Trying to match what the buyers need with what's being planted" is one of the biggest challenges, said Richard Rohrer, a Mennonite farmer and manager of the Shenandoah Valley Produce Auction.

Small-scale growers

When one large buyer recently demanded insurance — which is needed in case a fruit or vegetable makes someone ill — the Dayton farmers balked.

"We deal more on the handshake, personal commitment — look the grower in the eye," said farmer Vernon Hoover, the Dayton auction's independent buyer.

Still, Amish and Mennonite and even nonreligious small-scale growers in Virginia, Pennsylvania, Ohio, Iowa, Tennessee, New York and other states are mindful of the money to be made from this emerging relationship with big distributors. And they are willing to engage in some horse trading to create business relationships.

For example, they want industry demands such as specialty boxes and company labels to be factored into their price, according to Rich Pirog, associate director of the Leopold Center for Sustainable Agriculture at Iowa State University.

And while wholesale markets, or auctions, benefit the food industry by bringing together larger numbers of growers in one location, they also make it easier for smaller growers to make connections to representatives of big companies and their resources, including refrigerated trucks and bar-code labels.

"If you have a quality product, consistently packaged, don't top dress by taking the worst and putting it on the bottom — all that is the way you build your name here at the auction," Charlie Martin, the Dayton auction's board chairman, said. He proudly stood before a large stack of unblemished yellow and green squash that his 16-year-old daughter picked that morning, wearing surgical gloves to avoid marring their flesh.

Growing demand

The demand for what small-scale farmers have to offer is burgeoning.

• Wal-Mart last month said it would sell $400 million worth of locally grown produce this year, making it the largest player in that market. Its suppliers include "many Amish and Mennonite growers" who work through third-party suppliers, spokeswoman Deisha Galberth said.

• Chipotle Mexican Grill in June pledged to purchase 25 percent of at least one produce item for each of its stores from small and mid-sized farms located within 200 miles.

• Whole Foods Market purchased 22 percent of its produce locally last year, up from the previous year's 19 percent.

By any measure, though, the nation's 50-plus Amish and Mennonite produce auctions remain a sliver of food-industry sales. Total combined retail and fresh-produce sales were $94.8 billion in 2005, according to industry and government estimates.

The Cumberland Valley Produce Auction in Shippensburg, Pa., began in 1994 with roughly 500 Amish and Mennonite growers, whose customers were primarily local grocers and restaurants. Since then, it has doubled in size, thanks in large part to the demand from large, well-known companies. Buyers come to Shippensburg from New York, Pittsburgh, Washington, D.C., and other points.

A decade ago, Cumberland Valley wrestled with many of the same issues the Mennonites of Dayton, Va., are dealing with today. Now, the auction is large enough to afford liability insurance, in case a legal action arises from a tainted product, manager George Cleary said.

Cleary said there is a simple formula for success: "Good product and plenty of it."

In northeast Ohio, the Homerville Wholesale Produce Auction has instituted a system that tracks every box of produce to the grower's field, enabling chain grocers and food distributors to know the origin of any fruit or vegetable they sell.

The Homerville auction, which began operations in 1997, has seen annual growth of 20 percent to 40 percent, says F.W. Owen, a former dairyman who manages the market. The auction sells produce grown primarily by the Amish but also has Mennonite and other growers, he said.

The auction initially attracted independent regional grocers and farmstand owners from all around — Cleveland, Akron, Wooster and Elyria. Now national chains account for 25 percent of its sales, Owen said.

Splurge on equipment

After studying the success of these other operations, the Dayton auction, which began in May 2005, has seen its annual sales top $1 million — a significant milestone for an isolated farming economy that was once based in dairy.

The growers are primarily Old Order Mennonite, many of whom get around by horse and buggy and reject modern entertainment such as a TV and radio. That said, many splurge on the latest in farm equipment, including high-end tractors that can cost tens of thousands of dollars.

Eric Bendfeldt, an agricultural-extension agent who has worked closely with the Mennonite community to get the auction up and running, said that while the agrarian-based Amish and Mennonite communities are currently grappling with the demands of a new market, they are ultimately a natural fit for the big food companies.

They know and accept the rigors of farm work and are committed to quality farm practices, and their large families provide a key element of farming: labor.

Pirog, of the Leopold Center at Iowa State, said the farm products of the emerging Amish and Mennonite growers also connect with consumers seeking foods tied to a place or a country, such as Spanish hams or Italy's Parmigiano-Reggiano cheese.

Mennonite-grown, he added, "has a certain cachet."