Can local farmers benefit from expensive gas?

No one has to say it; we all know that gas prices have been rising steadily over the last couple of months. Crude oil has jumped dramatically given the unrest in the Middle East and our own economic troubles. So besides paying through the nose for fuel how else does this affect farmers?

Well, food prices have also made a huge jump in prices based not only on fuel prices and the economy but also poor growing seasons last year around the world and an ever-increasing demand for cheap food. With all this information I have to wonder: can organic/local producers use these numbers to their advantage?

I would say yes, but carefully. One of the great draws to local foods is the fact that it is ‘local’. It’s grown near where you consume it. So it would stand to reason that this would give local producers the rare chance to bring their prices on par with cheap commodity produce. It would take some planning, but if the local producer can keep their inputs low, and try and absorb the cost of fuel, it would stand to reason that they could maintain prices, while the ‘big guys’ pay big money to ship their goods in from all over the world.

This theory can also be applied to organic producers. The cost of industrial fertilizers are also tied tightly to fuel prices because many of them come directly from petroleum products, and they all require fuel to be transported. So hopefully these factors can help the local/organic producers in our area.

There is one big problem with this theory however.  As the cost of everything goes up and the economy goes down, people may be less likely to spend more for organic food. I personally would love to see the prices at farmers markets be cheaper than a grocery store, offering a higher quality product, and supporting local growers. Is that realistic? I don’t know, but it will be interesting to see this summer how this plays out.

The key to using our current situation to the advantage of local producers is to avoid the temptation to raise prices at the same rate as commodity prices. I would argue that by each producer maintaining their bottom line, staying local, and advertising this plan, it could be possible for local food to rival industrially produced food prices and to introduce more people to farmers markets and local food.

Tyler Albers

No comments:

Post a Comment