Viability of CSA models in bad times
My wife and I are embarking on a small farming adventure. We have several acres of fruit trees and garden space we are working on building into a small organic, permaculture based, market farm. We are both working full time jobs that pay well and are slowly buying equipment and installing fencing and irrigation and starting a small food forest.
My question is, how viable is this model during times of real economic stress? I know a lot of people who enter into hard times and suddenly stop buying organic because of price. Most of the financial models I've looked into require charging a premium for produce in either a CSA style model or on-farm sales, farmers markets, or restaurants.
When times get rough, that really expensive raw milk herd share will be one of the first things to go for a family that suddenly just needs to focus on getting enough food on the table, regardless of quality.
I was always of the opinion that a properly designed farm which limits off-farm inputs and dependence on large scale machinery would fare better than its large ag counterparts. My concept was that my costs would stay static while the large ag costs would continue to escalate. It's a good theory, assuming I can still charge a premium for my products. It's a bad theory if I can't charge that premium and the government prints money to subsidize the industrial ag model to 'feed the people'.
Great question. My wife and I are both working as well and working on establishing a small food forest and a large garden as well as a small nursery for perennial veggies and trees. Right now the project is a money pit which is ok well we can afford it. Our thought is that, aside from it being the right thing to do, it will give us a lot of options if/when things go bad. We'll be able to supply a portion of our own food and have enough left over to sell/barter/share with neighbors, family and friends. As far as a profit model, I think if it works now and allows you to continue to invest in natural capital and infrastructure improvements, that is good enough. When the next crisis comes the fall out will be unpredictable. If fuel and fertilizer becomes expensive, that will drive up costs of Monsanto corn you will still be able to compete with your lower input costs. In that scenario, I plan to get fabulously rich off potatoes….take that wall street! If everyone looses their jobs and millions of people are homeless and hungry, there will be a lot of people willing to trade/work for food. (Also might be a few willing to kill and steal for it). The premium may not be there and you may not denominate your apples in dollars any more, but they will still have value. Becoming a primary producer is, to my mind, the single most important thing you can do to improve your resilience. You may never make enough money off your venture to fund your 401k plan, but is that really the goal?
What part of the country are you in? I might sign up for a herd share from you if you're in the NW. Way to go on working towards a positive vision of the future btw! Permaculture is where we're all going if we're going anywhere.
I think you can't go wrong starting this. If you can make it work in the current economic climate, that's a good place to start. You can always adjust as the times change. It's always good to produce in the most cost-effective way, and that's usually in sync with nature. That way your margin will be that much bigger in "good" economic times, and hopefully still OK in less good times. I think though, that when things really go south, people might be happy, if they can get any milk at all. I think current industrial AG & Food industry is doomed along with its supply chain… I think everyone who can continue to produce food, without massive fossil fuel based inputs is going to do well!
Way to go on your new venture!
The CSA model seems to be working for growers and producers now. God only knows what the future looks like and where we will all be in relation to it.
The chances of our current food supply being impacted by an unknown future event of some sort is pretty good, the consequences of being impacted are pretty high. We think it is a good place to put a little time and money, the pay off tastes great too!
Last year was our first farmers market and it was wonderful to see the support of our community for what we are trying to do. We have about an acre of veggie production and an acre of orchard. We are getting a bit of a premium for our organically grown product in the next town over. This year we are starting a Farmers Market in our own community and hope to put up a road side stand. We are using the methods of Eliot Coleman and we find that they produce a BUNCH of food. We are working on producing our own compost. All of our chicken, cow and horse manure goes into a bin with all the dried vegetation we can gather, hope to compost it for two years.
Food or lack there in, is one of those basic needs that can drive a perfectly good person to do things they would not normally do. I am a pretty honorable guy and if I am honest with myself, I do not know what I am capable of doing to feed my kids. In the worst case scenario I would sure love to have an abundance of food to share with hungry neighbors, I would sure rather feed them than shoot them.
It is great to see the number of postings increasing in this forum! As important as wealth preservation is, I was a bit worried that there was too much chatter about gold and silver and not enough about DIRT.
KEEP POSTING. Tell us how your project is coming along!
Franklin Sanders has a great quote:
"The worlds economy may crash. But the next morning 7 billion people will wake up and want breakfast."
I'm overwhelmed by the number and quality of responses. Thanks everyone. I'll respond to these and post a little more information on our plan when I get a chance today.
Thank you for mentioning 'natural capital'. The 5 forms of capital, as a concept, really resonates with me. I do often forget about it though after being caught up in the world of dollars and paper assets.
I do believe there is much more investing I can do on the social capital side. I happen to live about a mile from an active grange hall and my wife and I have been planning on joining and participating but just haven't found the time yet.
I'm in Oregon's Willamette Valley about 20 miles from Eugene/Springfield. We don't have the land currently to start a mob grazing style cattle operation. We are currently members of a herd share with a farm that is only a mile down the street from us, which is why I mentioned it. It is expensive, I think with some better financial management it can be much less expensive, but if times got rough for me personally I might have to say goodbye to my raw milk although it is pure heaven.
I have been judiciously studying anything that Allen Savory or Greg Judy put out. I'm continually amazed by the more conventional (old school?) farmers around me who still buy an incredible amount of hay and turn over and replant pasture year after year with ginormous green machines. Because I live in in the grass seed capital of the world, where I can't kick over a piece of dirt and not have grass growing on it in a matter of days, I don't understand why so many of these fields are managed this way.
Thanks Heinzi, I tend to agree. I watched a great BBC series not long ago called Wartime Farm. I think its easily available on YouTube. One of my concerns in a collapse scenario is actually losing my land because I'm not farming it the way that the USDA wants me to farm it to maximize yield.
I think there is some historical precedence for governments stepping in during food crises and micromanaging farms under the banner of a food crisis. It definitely happened in England.
That being said, that is something tough to plan for.
I'm a huge fan of permaculture, even got my permaculture design certificate from Geoff Lawton a few years ago. I am, however, worried about the term being targeted in the future and have learned since that when talking to some of the farming extension services or researching or applying for grants using terms like agroforestry is much more ideal.
Another thought that occured to me would be to keep the farm split up in separate legal entities owning smaller blocks of land assuming that if regulations did filter down there would be a cutoff based on acreage.
Thanks Rob, I agree, some of the local farms who seem to being doing the best have a large part of their revenue coming from CSA. A farm about an hour from us, Working Hands Farm, does an incredible CSA and they also happen to do a fantastic job of leveraging social media as well.
I think a diversified model consisting of farmers markets and other revenue streams has got to be the most ideal.
I do agree that food is one of those things that will take even the highest minded individual and turn them into a savage. I don't think there is a realistic limit to what I might do if I was forced to look at my two children as they starved.
For Christmas, I received a book I'd been wanting for awhile by Joseph Tainter called The Collapse of Complex Societies. I was particular interested in the evidence from some of the early Egyptian dynasties where the farmers had to wear shields and carry weapons while working in the fields. I believe we are all conditioned to the last 50 or 60 years of unbelievable abundance and have a difficult time thinking seriously about the alternative.
If you have read any of Ferfal's accounts of the collapse in Argentina, it was the rural farm areas that were at serious risk because people eventually realized that that is where the food was. What made it worse, is that the law enforcement pulled back to protect the wealthy neighborhoods in the cities and there was no response in rural areas. This is basically true for the county I live in where there may only be one sheriff on patrol in the entire county, and its a sizeable one.
I do buy a little silver every month, but I do agree that an investment in some metal in my safe is not as good as investment in the BCS tractor and implements I purchased this year or perennial fruit and nut trees that produce a sizeable dividend every year.
I'm also a fan of Eliot. I've bought several collinear hoes and have started building soil blocks (with mixed success) and standardized on 30" beds etc.
Another thought that occurred to me would be to keep the farm split up in separate legal entities owning smaller blocks of land assuming that if regulations did filter down there would be a cutoff based on acreage.
While there may be an acreage cutoff, there may also be a regulatory burden per farm. If so, that strategy will make things worse. But then, there is no way to know for sure. All I know is that the 8-page form the USDA sent me about what my "farm" grew was very, very invasive. (And it's not a farm, it's a suburban kitchen garden.)
There is more than one way to skirt the acreage issue. While we only have a kitchen garden in a suburban yard, there is a forest, pond, and grassland behind out property flanking and under a utility right-of-way. People are encouraged to grow things under the grassy are under the high tension wires, since it keeps the weeds and saplings down – just leave a lane for trucks on one side and the areas under the electrical towers clear. And while they don't want you cutting down trees, they have no objection to you planting them. So we've been replacing storm-felled oaks with Chinese chestnuts. Neighbors have rows of veggies there. This will only increase as times get tougher, but we prefer permaculture solutions: they are less likely to be stripped at harvest since they look like part of the landscape.
I'm continually amazed by the more conventional (old school?) farmers around me who still buy an incredible amount of hay and turn over and replant pasture year after year with ginormous green machines.
As to the grass, hay and pasture thing: I hear you. Here in SC we have two strategies for idle agricultural land: perennial Bermuda hay, or forested southern pines. There are numerous beef cattle ranches nearby and horse farms quite close, and none of them plow pasture; they just rotate their herds through various fenced pastures. It's the same way in PA, where I was born.
I suppose it might be somewhat useful for farmers that turn over and replant pasture if they till something like alfalfa into the soil. But animal dung is a much better source of nitrogen, and it's no-till. So I share your confusion.
Finally, I am going to take Geoff Lawton's permaculture course this year. Was it as good as it sounds?