Local Food is Boosting Iowa's Economy

Posted on 02/27/2014 at 12:00 AM by Christa Hartsook

A new report from the Leopold Center for Sustainable Agriculture shows that institutional purchases of local food added nearly $9 million to the Iowa economy in 2012.

What’s more, the report points out enormous opportunities for local foods in Iowa that could benefit rural communities and farm-based businesses.

Investigators measured significant sales from only small segment of potential markets for local foods among grocery stores, restaurants, hospitals, nursing homes, college and school food services and other institutions.

The findings are part of an evaluation of the Regional Food Systems Working Group (RFSWG) that supports local food systems in 90 of Iowa’s 99 counties. It is the first coordinated, comprehensive attempt to measure actual economic and community impacts associated with regional food system development in Iowa.

The evaluation tracked local food purchases by grocery stores, restaurants and institutions, and sales from lowa farm-based enterprises that marketed their products locally in 2012. Nearly 180 businesses and individuals participated in the data collection effort, including 74 buyers and 103 producers of local foods. The evaluation also measured job creation as a result of local food production, processing or utilization, and counted funds leveraged by the regional food groups that comprise the statewide RFSWG network.

“Most of the information we’ve had in the past came from economic models, that is, projections based on potential scenarios and assumptions, not what actually happened during a specific time period,” said Corry Bregendahl, associate scientist , who coordinated the data collection project for the Leopold Center with Leopold Center program assistant Arlene Enderton.

She said the report also differs in the type of sales information that was collected, which included data from institutional and intermediary markets, as well as direct sales.

“Most people think local food sales are only those between farmers and individual consumers, such as farmers markets or community supported agriculture (CSA) enterprises,” she explained. “We also measured sales to institutions such as hospitals and nursing homes, and schools, grocery stores and restaurants. These markets represent huge potential markets for local foods, and serve a population that needs greater access to healthy food.”

Bregendahl and the coordinators of the 15 regional food groups in the RFSWG network collaborated to gather and assess the data. The coordinators distributed surveys to area buyers and farmers they worked with to collect information about these key indicators of economic impact:

  • Local food purchases in 2012: 74 buyers reported total purchases of $8,934,126.
  • Local food sales in 2012; 103 farmers reported total sales of $10,549,296;
  • New jobs related to local food In 2012: A total 36 new jobs (24 full-time equivalent) were created in 2012 (reported by a subset of buyers and farmers).
  • Funds leveraged by eight regional food groups in 2012: $766,020.

Bregendahl said the 74 buyers spent an average $120,700 on local foods, or about 8.7 percent of their total food budget, if local food purchases were increased to 30 percent of the total food budget, an additional $21.5 million in sales would have been generated, leading to the creation of 71 new full-time buyer-based jobs. Less than half of one percent of the estimated 22,000 institutional and intermediary markets in Iowa participated in this evaluation.

[Full Report]

Categories: Local/Regional Foods