February 19, 2014

‘Food Hubs’ Improve Local Economy, Cornell Study Shows

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In response to an increased demand for locally sourced food, “food hubs” — local networks for distributing produce — have become more common in the region, which can serve as links between farmers and their expanding customer bases, according to a Cornell study.

According to Prof. Todd Schmit, applied economics and management, medium-scale farmers have faced barriers in distributing a sufficient amount of produce because farmer’s markets — such as the Cornell Farmers’ Market — do not address a wide enough audience.“Farmers overwhelmingly reported that they can sell more products because of food hubs.” — Becca Jablonski grad

“There’s renewed interest in the types of organizations that can aggregate, market and distribute products from a number of producers,” he said. “So we’re seeing more financing and public policy attention towards developing food hubs.”

Schmit — who worked with Becca Jablonski grad and David Kay M.S. ’93 — published in December the results of a three-year study on the local economic impact of food hubs.

The study focused on New York food hub Regional Access as part of their assessment, and the researchers interviewed producers and consumers across New York with whom the hub interacted with.

According to Jablonski, the researchers found that food hubs can improve local economies, which benefit farmers and customers alike.

“Farmers overwhelmingly reported that they can sell more products because of food hubs,” Jablonski said. “We talked to over 300 business customers and individual households, and they reported that they had better access to local food. So overall it improved the picture.”

The goal of the study was to develop a methodology for assessing the impact of food hubs, which had not previously existed, according to Schmit.

“What we wanted to do was develop a framework for evaluation of [food hubs] with particular attention to the economic multiplier impacts and impacts on communities,” he said.

Food hubs did have a negative effect on distributors of nonlocal food — for every dollar sale made by food hubs, 11 cents were lost to other distributors — the overall effect on local economies was positive, Jablonski said.

“As a farmer selling to a food hub you now have to plant more acreage. In order to plant that acreage you have to buy more seeds, you’re getting more labor probably too, and you’re paying those laborers wages and those wages are spent then in the local economy,” Jablonski said. “So think about all of that additional spending, all of that economic impact that occurs because of these additional sales.”

The study did not assess whether farmers’ market sales were offset by food hub sales, Jablonski said. Farmers’ markets do not qualify as food hubs because they serve as a central location where customers go to buy produce rather than transporting and distributing goods to customers.

Jacob Miller ’14, co-president of the Cornell Farmers’ Market, said he believed that farmers’ markets are still extremely valuable despite reaching a smaller consumer base than food hubs do.

“There’s so much passion that exists in a farmer’s market that I [don’t] necessarily feel that I’ve been exposed to [in other contexts],” Miller said.