Washington State University

Small Farms Team

Farmers' share is shrinking, but consumers can call the shots

Steven M. Garrett*, August 19, 2001, Tacoma News Tribune

A July 29 article in The News Tribune about Kenyan coffee growers who receive only a penny per pound for their beans was as eye-opening as a double-tall espresso. Like the coffee I drank as I read that article, the coffee they grow is of high quality and destined for whole-bean and coffee shop markets, selling for up to $12.99 per pound. But unlike their coffee, mine pays its growers a livable wage.

One of the most sobering aspects of that article was not the penny-per-pound figure but that many others profited while the growers sank further into debt — and hunger. This situation is not limited to Kenyan coffee growers but is common with farming throughout the world today, including in our community.

Prices are global, while production costs are local

The article blames the Kenyan coffee growers' situation on corruption, as well as U.S. trade-liberalization policies that have ended pacts that stabilized the price coffee growers receive. International trade liberalization policies have also meant that U.S. farmers must compete on a global market against countries whose labor is cheaper and whose environmental standards are often lower.

This scenario is summed up by the agricultural economics axiom that "prices are global while production costs are local."

The handful of multinational food corporations (e.g., ADM, Cargill, Monsanto and Novartis) that now dominate our global food system have the economic leverage to buy food from many nations and make farmers compete against each other for lowest prices.

While this forced competition means that Americans pay less for their food (as a percentage of their income) than any other nation — and less than ever before — it also means that farmers are going broke at dramatic rates. In Pierce County alone, we lost one farmer every two weeks and 4.3 acres of farmland per day between 1992 and 1997.

One vivid case study is the plight of apple growers in Washington state. They receive around 8 cents per pound for apples, which cost nearly 15 cents per pound to produce. Why are they getting so little for their apples when the cost of apples in the supermarket has remained stable? One reason is that China now outproduces our state and its production costs are much lower.

According to Stewart Smith, professor of sustainable agricultural policy at the University of Maine, the American farmers' share of the food dollar has been steadily shrinking over the last few decades.

In 1920, the farmers' share of the food dollar was 41 percent. By 1990, it had shrunk to 9 percent, while the marketing share increased from 40 percent to 70 percent. In this case, marketing refers to advertising, processing and distribution.

The result of this obvious lack of economic return for farmers is that many are abandoning farming. If they can sell their land to developers to obtain money for retirement, then they do. If they live in areas where there is little development, as in Okanogan County, they often just let the land turn to weeds.

While farms are rapidly folding, supermarkets and food distributors and processors are still making a profit. In fact, the food industry is one of the most profitable economic sectors in the world — just not the farming part of it.

We all like to have inexpensive food (and everything else) and it appears that as consumers we are at the end of the "farm to table" food chain. So what can we really do about this modern tragedy?

The first thing we need to realize is that we are actually in charge of this food chain, even when our role is passive. What we buy and eat determines who produces our food, how it is produced and where it is produced. As Wendell Berry once wrote, "Eating is, essentially, an act of agriculture."

One way we can help farmers stay profitable is to buy food directly from farmers, so we can ensure that the farmer makes a livable wage; they and you, not the global marketplace, determine the price you pay. This also excludes the middlemen from taking their large share of your food dollar.

Information is available on the Internet. To find a local farmers market or a farmer who sells direct to the public, go to the Puget Sound Fresh Web site. To find a Community Supported Agriculture farm where you can sign up for a weekly food basket, go to the Seattle Tilth site.

To learn more about Community Supported Agriculture, see The News Tribune's July 26 article, "Living off the land."

If you want to find coffee that provides a livable wage for its growers, ask for coffee that is Fair Trade Certified or look for the certification on the label. Many South Sound area grocery stores and coffee shops carry fair trade coffee. You can find out more about this issue at:
http://www.globalexchange.org/economy/coffee

*Steven M. Garrett is an extension agent with the Washington State University Extension Service in Pierce County. He can be reached at sgarrett@wsu.edu.

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