Niche markets a growing economic opportunity

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Stoddard County ranks in the top three annually in the state in terms of total sales of agriculture products and number one for crop sales. That means agriculture is big business to county residents.

Van Ayers, Ed.D., community development specialist with the University of Missouri Extension Service, spoke to board members of the Bootheel Regional Planning and Economic Development Commission (BRPC) Thursday about economic opportunities for smaller growers in what he termed “niche markets.”

Ayers cited McKastle Farms in Braggadicio, Mo., Hamra Farms in Morehouse, Mo., and Family Friendly Farms near Cape Girardeau as examples of businesses that are successfully selling locally-grown products. There is a trend among consumers to prefer organic, locally grown food products over those mass produced, said Ayers.

Ayers noted that it did not take a large amount of land to be successful in these ventures. He said a series of meetings to promote smaller agriculture ventures in the six-county area served by the BRPC was not well attended. He said the area is dominated by large scale production of row crops, which makes the smaller market operations less attractive.

The Missouri Bootheel Local Foods Initiative, sponsored by DAEOC and the Delta Regional Authority, did a market survey of the buying practices of school districts, nursing homes, 27 local restaurants and 32 grocery stores in the Bootheel.

Ayers noted that the USDA has many rules and regulations for selling produce to commercial establishments, but these deal with overall quality, and not health and safety. He explained that the health and safety regulations come into play when the food is processed.

Ayers said some restaurants prefer to buy their produce locally, and do so. That is particularly true in larger cities where niche farming is really taking hold. Nursing homes were also found to be favorable to buying locally.

Ayers cited statistics showing school districts in the area feed 25,000 students lunches during the school year, and 15,000 students eat breakfast. That is a large market. Of the school districts surveyed, 14 were under contract with a company for food service and 10 were independent. The independent districts were open to buying local produce, while the private contractors who serve the other districts have their own individual policies.

Opaa! Food Management is under contract to provide food services at many school districts in the area. Other companies are Aramark and Chartwell.

Opaa! actually prefers to buy produce locally. Ayers said the new regulations governing food service in schools has put more emphasis on vegetables and fruits, which means more have to be purchased. One of the easiest ways to meet these standards is a salad bar, Ayers said.

Hamra Farms is a hydroponic growing operation growing lettuce, cucumbers, tomatoes and bell peppers. They were able to sell their products to Opaa! which goes into 44 school districts from the Bootheel to near Springfield.

McKastle Farms sells organic rice and popcorn. They have landed a contract with a national restaurant chain and doing “very well,” said Ayers. Their potential is limited only by their ability to produce the needed organic products.

Family Friendly Farms sells free-range chickens, and have been very successful. He said the quality of the product is attractive to restaurants and grocers. While it is more expensive, consumers are willing to pay more for freshness and quality.

Another venture that is getting underway is Heckemeyer Sweet Sorghum, which makes 100 percent sorghum. He said this operation has the potential to become big.

Ayers conceded there were some limitations. Opaa! and many grocery stores require a $2 million liability standard, in addition to GAP (Good Agricultural Practices) standards. He said neither requirement is prohibitive, and some buyers do not require the GAP standards.

Another drawback is that contracts signed with school districts require delivery of goods for a nine-month period, even through the non-growing months of winter.

Ayers said he found produce managers in some grocery stores have the ability to buy a certain amount of local produce without going through corporate approvals. He said it is an asset for grocers to feature local produce when in season. The “Grow Your Farm” program will be starting up in St. Louis soon to help develop niche markets.

Grants are available for help in starting up these types of businesses. The USDA has several grant programs, for which Ayers has helped write grant proposals. There are other financial options available in certain geographic areas.

Ayers conceded he was frustrated with the lack of interest in these operations in the Bootheel. He suggested that these opportunities should be discussed with local FFAs and 4-H groups, and they should be encouraged to pursue these opportunities. He noted that one local teen sold locally grown tomatoes to a grocer, and managed to make more income than if he had mowed yards all summer.

Ayers’ office is in the old courthouse in Bloomfield. He may be reached by calling 573-568-3344 or emailing him at [email protected]

Other action

The BRPC Board elected new officers at their meeting Thursday. The new officers were Chairperson David Wilkerson, a former Pemiscot County commissioner; Vice Chairman Lonnie Thurmond, city administrator at East Prairie; Secretary Ron Eskew, city administrator at Scott City; Treasurer Bill Hampton, director of the Three Rivers Dexter Center; and Assistant Treasurer Marilyn Fiddler, city clerk at Malden.