Duration: 10/01/2012 to 09/30/2017

Administrative Advisor(s):

NIFA Reps:

Non-Technical Summary

Statement of Issues and Justification

Statement of Issue(s) and Justification
Long-term USDA data clearly show that the industrialization of the U. S. food system has resulted in dramatic changes in how food products are produced and distributed. While the numbers of both small and large farms have increased, many mid-sized farms and ranches have disappeared. In the decade from 1997 to 2007, the number of farms grossing between $50,000 and $500,000 decreased by nearly 25 percent. Operations in this sales range are often too large or poorly located to direct market their products and are increasingly unable to compete successfully on price in global commodity markets. Beyond the farm level, the food processing, distribution, and retailing sectors have witnessed similar consolidations. The implications of these structural changes in the food system for stakeholders remain poorly understood.

Three previous projects, NCDC 207 (Research and Education Support for the Renewal of an Agriculture of the Middle, 2004-2006), NC 1036 (Research and Education Support for the Renewal of an Agriculture of the Middle, 2006-2010) and NCDC 223 (Advancing Research, Education, and Policy to Support Renewing an Agriculture of the Middle 2010-2012), have investigated the implications of this changing structure of U. S. agriculture and considered potential responses. More specifically, midscale values-based supply chains were examined as an alternative to local direct marketing and global commodity marketing. It is hypothesized that these midscale chains represent strategic business alliances among farms of the middle and other agrifood enterprises that: (a) handle significant volumes of high-quality, differentiated food products, (b) operate effectively at multistate, regional levels, and (c) distribute risk and profits transparently and equitably among the strategic partners. Values-based supply chain business models place emphasis on both the values associated with the food and on the values associated with the business relationships within the food supply chain.

In many conventional supply chains, business relationships are framed in win-lose terms. Relationships are constructed as competitive, even adversarial, whereby each company seeks to buy as cheaply and sell as expensively as possible. While this model may be appropriate for undifferentiated commodity supply chains, where each partys goal is profit maximization, it may not perform well for supply chains where differentiation is based primarily on product (including production methods) and relationship qualities. Framed in win-win terms, values-based supply chains are viewed as having the potential to provide commitments to the welfare of all partners in the supply chain, including fair profits, fair wages, and business agreements of appropriate, extended duration. Given the interdependence inherent in values-based food supply chains, participants should have a strategic self-interest in the performance and well-being of the other partners. In these supply chains, farmers and ranchers would be treated as strategic partners, not as interchangeable (and exploitable) input suppliers. These are all statements that can be (and to only a limited extent have been) empirically examined.

Over the last five years, project participants have increased the visibility and understanding of values-based supply chain development options through successful advocacy of changes in the language used in USDA RFPs, a series of successful research, outreach, and educational grant proposals, and a range of scientific and popular press publications. See Lyson, Stevenson, and Welsh, 2008, the publications available at http://www.agofthemiddle.org/, and the recent special issue of the Journal of Agricultural, Food Systems, and Community Development available at http://www.agdevjournal.com/volume-1-issue-4.html.

The new coordinated research effort proposed here will serve to further analyze and understand the results and potential of agriculture of the middle type values-based supply chains. The new effort will both re-examine the existing research studies from new perspectives and add additional baseline projects. Examples of the new issues to be explored are the implications of these values-based supply chains on the distribution of decision-making within the food system, the management of rural landscapes and natural resources, the well-being of rural communities, and the impact of public and private sector policies.

While specific project objectives are presented in greater detail in a separate section below, here is a summary of what will be studied within the project:

Organization/Ownership Objective: Determine key factors that influence patterns of ownership, control, and business relationships within values-based supply chains and investigate how all three influence economic performance and viability of participating farms and ranches and other chain partners.

Social Objective: Identify the community-related goals and needs of values-based supply chains and assess the impact these chains have on the communities in which they operate. Examine labor arrangements throughout these chains.

Landscape/Environmental Objective: Identify the environmental and natural resource-related goals of values-based supply chains and assess the impact these chains have on the landscapes in which they operate.

Policy Objective: Determine how existing policies in a number of areas such as commodity subsidies, conservation payments, rural development and others influence the performance of values-based supply chains, and how policies and programs could be redesigned to enhance the future performance of these chains.
We will also be identifying policy research topics that can be pursued by participants in this multistate project and others.

Technical feasibility of the research/outreach; justification of a multistate effort; impacts from successful completion of this effort

The registered members of this new research project have demonstrated their capacity to both conduct appropriate studies and provide technical assistance to agricultural sector participants. The work conducted under previous projects clearly demonstrates that excellent opportunities exist to match producers of the middle with a growing demand for high quality differentiated products but that further research is required to overcome numerous barriers. Many members have funded or potentially funded projects on topics that fit under this umbrella and recognize the benefits of a national network of academics focused through this multistate research effort.

The experience of the last five years has been that the most successful efforts have crossed geographic, disciplinary and commodity boundaries (see for example the various research projects cited above). Many of the researchers and outreach specialists who have expressed an interest in working on these topics have limited collaboration opportunities with colleagues in their own state and therefore they will benefit greatly from the opportunity to network with participants from other states and regions. The current NCDC 223 members will participate in an effort to recruit new participants to work on this topic and collectively are committed to address all project objectives.

Successful completion of this research effort will: 1) Document in much greater detail what these values-based food supply chains actually deliver; 2) Help existing values-based supply chains evaluate and improve their performance; 3) Provide models for potential values-based supply chain participants: 4) Provide guidance on the design of appropriate policies.

Related, Current and Previous Work

Related, Current, and Previous Work

The disappearance of mid-sized farms/ranches (Figure 1) has been the focus of attention of rural sociologists and agricultural economists for many years (Buttel, 1999; Buttel and LaRamee, 1991; Galeski and Wilkening (editors), 1987; Lyson, 2004; Hoppe, MacDonald, & Korb, 2010). Researchers continue to explore the connection between farm structure and community vitality in agriculturally dependent rural areas, a theme framed as early as the 1940s by the social anthropologist, Walter Goldschmidt, in his study of two California rural communities situated in differing agricultural contexts (Goldschmidt, 1978). The communities surrounded by mid-sized, family farms exhibited considerably richer and more diverse community institutions than did the communities surrounded by larger, agribusiness-owned farms. The Goldschmidt hypothesis has continued to be a focus of attention and debate (Strange, 1989; Welsch and Lyson, 2001, Lyson, 2004) and will be broadened in this research to also include environmental and landscape issues (Francis et al., 2005).


In 2003, a broad consortium including the W.K. Kellogg Foundation, the Johnson Foundation, the USDA Sustainable Agriculture Research and Education (SARE) program, the Leopold Center at Iowa State University, and the Center for Integrated Agricultural Systems at the University of Wisconsin organized a Task Force that focused on renewing an agriculture-of-the-middle (see the consortium website at www.agofthemiddle.org). These researchers drew upon a rich business literature focused on both products with unique and superior characteristics (Porter, 1990) and on supply chains based on long-term interorganizational relationships also known as extended enterprises, strategic alliances, integrated value systems, and value-added partnerships (Dyer, 2000; Handfield & Nichols, 2002). The products may be differentiated by attributes such as organic, grass fed, or regionally sourced (Brady & OBrady, 2008) or by emphasizing issues of social justice and environmental responsibility (Jaffee, Kloppenburg, & Monroy, 2004).


This effort led to formation of initially NCDC 207, then NC 1036 and most recently NCDC 223. The project participants have created a network of scientists from a range of academic disciplines focused on the complex issues related to Agriculture of the Middle. This group has collaborated on many funded projects; informed each others research topics, hypotheses, and study design; and shared interview guides, surveys and other research instruments. The group also developed a comprehensive research agenda, A Priority Research Agenda for Agriculture of the Middle (Clancy and Lehrer, 2010) that has been widely distributed and used. Each of the objectives for the current proposal were first raised in the research agenda and then refined in NCDC 223 meetings and email exchanges.


Four examples of specific accomplishments from funded projects in recent years are:
" A group of scientists coordinated by G. W. Stevenson (University of Wisconsin) explored how successful and mature values-based food supply chains deliver high quality, differentiated products from groups of mid-sized farms/ranches to regional retail and food service markets (see completed case studies at www.agofthemiddle.org and also Lev and Stevenson 2011).
" Research by David Conner (Michigan State University) and Hardesty (UC Davis) and others focused on how these chains performed in farm-to-school and other institutional purchase settings (Conner et al, 2011, Hardesty et al. 2011).
" Dawn Thilmany-McFadden (Colorado State University) led an effort to improve market access for mid-sized farms (Thilmany-McFadden, 2008).
" Robert King (University of Minnesota) and others conducted a set of case studies that compared local and mainstream supply chains and demonstrated the key role that values-based supply chains can play in the U. S. food system (King et al., 2010).


Each of the above projects also developed educational curricula to be used in formal and informal educational settings. An example of teaching materials can be found at:
http://www.agofthemiddle.org/archives/2011/07/value_chain_tea.html#more


Group members produced more than 100 publications including two edited volumes (Hinrichs and Lyson, 2007 and Lyson, Stevenson, and Welsh, 2008) and many of the articles in the recent special issue of the Journal of Agricultural, Food Systems, and Community Development focused on values-based food supply chains (http://www.agdevjournal.com/volume-1-issue-4.html).


Two overlapping annotated bibliographies do an excellent job of assembling both published research and relevant grey literature focused in this area:


University of California-Davis Sustainable Agriculture Research and Education Program: http://asi.ucdavis.edu/newsroom/blog/Food%20Hubs%20Annotated%20Biblio%20-%20FINAL%208-31.pdf


USDA/AMS: http://www.ams.usda.gov/AMSv1.0/getfile?dDocName=STELPRDC5091486


At the federal level, the AOTM group worked with USDA/AFRI staff to modify the foundational program, Prosperity of Small and MediumSized Farms and Rural Communities, by including medium-sized farms in addition to small farms, by encouraging efforts focused on complete supply chains rather than just the farm level, and by defining this as an integrated program rather than a research only program. The AOTM group has also interacted with USDA/AMS staff in the development of the food hub effort (http://www.ams.usda.gov/AMSv1.0/foodhubs) that is explicitly connected to the ongoing research and outreach on agriculture of the middle.


A review of the NIMSS database identified three recently terminated and four active multistate projects with some overlap with this proposal.
NE1011: Rural Communities, Rural Labor Markets and Public Policy; Oct. 2002 to Sept. 30, 2007; Terminated.

S1019: Fruit and Vegetable Marketing Innovations and Demand Assessment; Oct 2003 to Sept. 2009; Terminated.

NC1033: Local food choices, eating patterns, and population health; Oct. 2006 to Sept. 2011; Terminated.

NC1196: Food systems, health, and well-being: understanding complex relationships and dynamics of change; Sept. 2016; Active.

S1051: Sustainable Practices, Economic Contributions, Consumer Behavior, and Labor Management in the U.S. Environmental Horticulture Industry; Sept. 2015; Active.

NCCC065: Indicators of Social Change in the Marketplace: Producers, Retailers, and Consumers; Oct. 2011 to Sept. 2016; Active.

NE1029: Rural Change: Markets, Governance and Quality of Life; Oct. 2007 to Sept. 2012; Active.

A careful examination of the objectives of each project revealed that this proposal would complement and extend these projects rather than duplicate their efforts. None of these other projects focus specifically on mid-size farms and their supply chains.

Objectives

1. Determine key factors that influence patterns of ownership, control, and business relationships within values-based supply chains and investigate how all three influence economic performance and viability of participating farms and ranches and other chain partners.
   
2. Identify the community-related goals and needs of values-based supply chains and assess the impact these chains have on the communities in which they operate. Examine labor arrangements throughout these chains.
   
3. Identify the environmental and natural resource-related goals of values-based supply chains and assess the impact these chains have on the landscapes in which they operate.
   
4. Determine how existing policies in a number of areas such as commodity subsidies, conservation payments, rural development and others influence the performance of values-based supply chains, and how policies and programs could be redesigned to enhance the future performance of these chains. We will also be identifying policy research topics that can be pursued by participants in this multistate project and others.
   

Methods

Methods for Objective #1 will include: evaluative case studies of existing values-based supply chains; surveys and analyses of emerging values-based supply chains using targeted interviews, organizational documents, and round-table discussion approaches; interactive workshops and webinars designed and delivered to bring together researchers and practitioners to explore these key issues; and white papers and technical journal articles to summarize and publicize the results of these surveys, workshops, and webinars to reach a larger audience of key decision makers. Research methods and findings will be shared not only within the multistate teams working together on funded projects but also across teams using the sharing opportunities provided by this NIMSS project. Methods for Objective #2 will include: surveys of key community decision makers in selected communities to identify current needs and long-term goals; in-depth analysis of ten communities to assess impacts of values-based supply chains; focus groups in these same communities to gather additional information about major factors that contribute to success; and analysis and evaluation of labor conditions and arrangements in successful communities. Reevaluate existing values-based supply chain case studies to examine how community-based social concerns, including fair labor practices, are (or are not) explicitly articulated as "values" by supply chain actors. Analyze current standards and certification protocols for agrifood products that incorporate fair labor practices and other community goals into their business operations in order to identify best practice models. Research methods and findings will be shared not only within the multistate teams working together on funded projects but also across teams using the sharing opportunities provided by this NIMSS project. Methods for Objective #3 will include: surveys and interviews of people in successful communities to assess their identification of key environmental issues and goals; focus groups to identify individual and community environmental goals and assess their recognition of ecosystem services as important to the communities futures; and evaluate the awareness of communities to landscape-level issues and to how they can best exploit local resources in an efficient and sustainable manner for the long term. Research methods and findings will be shared not only within the multistate teams working together on funded projects but also across teams using the sharing opportunities provided by this NIMSS project. Methods for Objective #4 will include: analyses of a broad range of national and state legislation, policies, and regulations; dialog with bio-physical and socio-economic scientists about the information/research needed to support new legislation and/or regulations; and analyses of the political forces likely to be in support of or opposed to new legislation and/or regulations. Research methods and findings will be shared not only within the multistate teams working together on funded projects but also across teams using the sharing opportunities provided by this NIMSS project.

Measurement of Progress and Results

Outputs

• Preparation and circulation of white papers on key issues to key decision makers
• Peer-reviewed academic publications
• Presentations at professional and/or academic conferences/meetings
• Additional publications for farmers/ranchers, food processors, distributors, and retailers interested in values-based supply chains that will be added to the series developed under NC 1036 and NCDC 223.
• Technical bulletins and workshops for targeted service professionals, e.g. Cooperative Extension personnel, NRCS personnel, RC&D coordinators, high school science and vocational agricultural educators, and for key educators in agricultural universities and liberal arts colleges.

Outcomes or Projected Impacts

• Increased information for mid-sized farmers/ranchers, regional food processors, distributors, and retailers that will enable them to understand the opportunities that they have to participate in values-based supply chains.
• A better understanding of the community-related implications of values-based supply chains.
• A better understanding of the environmental impacts at the landscape level of these values-based supply chains.
• Increased number of regional values-based supply chains that may provide farmers/ranchers and their supply chain partners with greater economic rewards and food consumers greater information and choice regarding their food purchases, communities with important social contributions, and affected rural landscapes with improved environmental performance.
• Increased contribution by values-based supply chains to the long-term stabilization and renewal of an agriculture-of-the-middle.

Milestones

(2013): For all four objectives(some funded projects will have begun one or more years into this five year cycle: Form team, conduct background research, and write funding proposal. Attend annual meeting of the multistate project to share experiences and lessons learned about the funding process.

(2014): For all four objectives(some funded projects will have begun one or more years into this five year cycle): Initiate data collection and interactive engagement activities. Attend annual meeting of the multistate project to share questionnaires and interactive engagement formats.

(2015): For all four objectives(some funded projects will have begun one or more years into this five year cycle): Continue data collection and analyze data. Attend annual meeting of the multistate project to share data analysis approaches and results.

(2016): For all four objectives(some funded projects will have begun one or more years into this five year cycle): Finalize analysis and make presentations at professional meetings. Attend annual meeting of the multistate project to compare results.

(2017): For all four objectives(some funded projects will have begun one or more years into this five year cycle): Produce cross project comparisons and finalize journal articles. Attend annual meeting of the multistate project to decide on next steps.

Projected Participation

View Appendix E: Participation

Outreach Plan

Most efforts coordinated under this multistate project are "integrated projects" so outreach (and education)activities are directly linked with research. In addition to the outreach products described above under Outputs, this multistate research effort will collaborate closely with the diverse organizations (The USDA, state departments of agriculture, The Association for Family Farms, The Wallace Center, regional working groups and others) working on similar topics.

Two ongoing sets of outreach activities provide models for future work:

The team coordinated by Stevenson (University of Wisconsin) and Lev (Oregon State University) produced long and condensed versions of each case study available through multiple web sites and conducted regional outreach workshops that featured the case study practitioners.

Gwin(Oregon State University)is leading an eXtension Community of Practice, The Niche Meat Processor Assistance Network (NMPAN), that is a national network of university extension faculty, state and federal regulators, NGOs, processors, and livestock producers interested in creating and supporting appropriate-scale meat processing infrastructure for local and regional niche meat markets.

NMPAN conducted 10 webinars in 2010-2011, on topics ranging from laws and regulations to business tools to how producers and processors can partner effectively to serve local & regional markets. Its Recent publications include a Mobile Slaughter Unit Manual, Small Meat Processors Business Planning Guide, and State-by-State Guide to Poultry Processing Regulations.

NMPAN has state affiliates (point people; primarily extension faculty) in 39 states.NMPAN listserve has more than 500 members and is an active community that posts and answers questions weekly and sometimes daily. NMPAN publishes a newsletter 10 times each year, and sends a syndicated news page to 12 state and regional meat processor associations around the country.

Overall this new multistate project will continue to produce and distribute outreach materials interned for diverse audiences and use a variety of media to achieve this goal.

Organization/Governance

This multi-state research/education committee will be organized nationally with opportunities for working groups to emerge along both content and geographic lines. Research areas will be defined and scientists will self-select into clusters of interest. One of the major objectives of these smaller groups will be to obtain additional funding. Outreach will be conducted on state, regional, and national levels. The committee will meet annually and between-meeting communication will be achieved through email list-serves and teleconferences. Clusters may seek to meet in conjunction with other professional meetings/conferences which most members attend. The national committee will be facilitated by a chair, vice-chair, and secretary elected for up to three year terms. The administrative advisor for the proposed multi-state committee will be Joe Coletti from Iowa State University.

Literature Cited

Brady, Eileen and Caitlin OBrady. (2008). Consumer considerations and the agriculture of the middle. In T. Lyson, G. Stevenson, & R. Welsh (Eds.), Food and the Mid-level Farm: Renewing an Agriculture of the Middle. Cambridge, MA: The MIT Press.

Buttel, Frederick and P. LaRamee. 1991. The Disappearing Middle: A Sociological Perspective. In Towards a New Political Economy of Agriculture. William Friedland, L. Busch, F. Buttel and A. Rudy (eds.) Westview Special Studies in Agricultural Science and Policy: Westview Press.

Buttel, Frederick. 1999. Wisconsin Agriculture in the 1990s: Perspectives from the 1997 Census of Agriculture. Program on Agricultural Technology Studies, Madison, WI: University of Wisconsin.

Conner, David S., Andrew Nowak, JoAnne Berkenkamp, Gail W. Feenstra, Julia Van Soelen Kim, Toni Liquori, and Michael W. Hamm. 2011. Value Chains for Sustainable Procurement in Large School Districts: Fostering Partnerships. Journal of Agriculture, Food Systems, and Community Development. 1(4): 55-68.


Dyer, Jeffrey. 2000. Collaborative Advantage: Winning through Extended Enterprise Supplier Networks. New York: Oxford University Press.


Feenstra, Gail, Patricia Allen, Shermain Hardesty, Jeri Ohmart, and Jan Perez. 2011. Using a Supply Chain Analysis To Assess the Sustainability of Farm-to-Institution Programs. Journal of Agriculture, Food Systems, and Community Development. 1(4): 69-84.

Francis, C., G. Lieblein, H. Steinsholt, T.A. Breland, J. Helenius, N. Sriskandarajah, and L. Salomonsson. 2005. Food Systems and Environment: Building Positive Rural-Urban Linkages. Human Ecology Review 12(1):60-71.

Galeski, Boguslaw and E. Wilkening (eds.). 1987. Family Farming in Europe and America. The Rural Studies Series of the Rural Sociological Society. Boulder, Co: Westview Press.

Goldschmidt, Walter. 1978. As You Sow: Three Studies in the Social Consequences of Agribusiness. Montclair, NJ: Allanheld, Osmun. (Originally published in 1947.)

Handfield, Robert, and Ernest Nichols. 2002. Supply Chain Redesign: Transforming Supply Chains into Integrated Value Systems. Upper Saddle River, NJ: Prentice Hall.

Hinrichs, C. Clare, and Thomas Lyson. 2007. Remaking the North American Food System: Strategies for Sustainability. Lincoln, Ne: University of Nebraska Press.

Hoppe, R., MacDonald, J., & Korb, P. 2010. Small Farms in the United States: Persistence under Pressure. EIB-63. United States Department of Agriculture, Economic Research Service.


Jaffee, D., Kloppenburg, J., & Monroy, M. 2004. Bringing the Moral Charge Home: Fair Trade within the North and within the South. RuralSociology, 69(2): 169197.


King. Robert P, Michael S. Hand, Gigi DiGiacomo, Kate Clancy, Miguel. I. Gómez, Shermain. D. Hardesty, Larry Lev, and Edward W. McLaughlin. 2010. Comparing the Structure, Size, and Performance of Local and Mainstream Food Supply Chains. USDA/ Economic Research Report No. (ERR-99) 81 pp.

Lev, Larry and G. W. Stevenson. 2011. Acting Collectively To Develop Midscale Food Value Chains. Journal of Agriculture, Food Systems, and Community Development. 1(4): 119-128.

Lyson, Thomas. 2004. Civic Agriculture: Reconnecting Farm, Food, and Community. Medford, MA: Tufts University Press.

Lyson, Thomas, G. W. Stevenson, and Rick Welsh. 2008. Food and the Mid-Level Farm. Cambridge, MA: MIT Press.

Porter, Michael. 1990. The Competitive Advantage of Nations. New York: Free Press.

Strange, Marty. 1989. Family Farming: A New Economic Vision. Lincoln, NE: University of Nebraska Press.

Thilmany McFadden, D. 2008. Local marketing systems: The Role of Family Farms in Reinventing Food Supply Chains. Article in USDA-CSREES Family Farm Forum. October.

Welsch, Rick and T. Lyson, 2001. Anti-Corporate Farming Laws, the Goldschmidt Hypothesis, and Rural Community Welfare, Paper presented at the Rural Sociological Society, Albuquerque, NM.

Attachments

Land Grant Participating States/Institutions

AL, CA, CO, GA, IA, KY, MA, MI, MN, MO, MT, NC, NE, OR, PA, VT, WA, WI

Non Land Grant Participating States/Institutions

Ecotrust, Independent Food Systems Consultant, NIFA, Ohio University, Oregon State University, Renewing the Countryside, University of Chicago, University of Wisconsin-Madison, USDA, USDA/ERS