Rooting Wealth that Sticks! Little Rock, Arkansas

October, 2013

Introduce The Deep South Wealth Creation Network

Provide a brief overview of the

Value Chains & Forms of Wealth Provide an Overview of the Alabama/

Mississippi Value Chain Project

Alabama Partners

Mississippi Partners

Alabama Sustainable Agriculture Network (ASAN)

National Wildlife Federation

Perry County Center for Economic Development

The Cottage House

The United Christian Community Association

Children’s Defense Fund

Mississippi Action for Community Education

Quitman County Development Organization

Southern Rural Black Women’s Initiative

Winston County Cooperative

Mileston Cooperative

Tougaloo College

Supporting Partners

• McIntosh SEED

• Rural Support Partners

Funding Partners

• Ford Foundation

• Yellow Wood Associates

• Center for Rural Entrepreneurship

DEEP SOUTH WEALTH CREATION NETWORK

Accompanying Issues

Rural Mississippi: 25.8%

Rural Alabama: 21.8%

2010. USDA Economic Research Service

Apathy

Low Education Rates

Low Ranking on the Human Development Index

Limited History of Collaboration

Systemic Racism

Exodus of Youth

Depopulation

Entrenched Poverty

Systemic racism - still prevalent in many formal systems, institutions, and policies – is the underlying cause of many of these issues. It continues to hinder economic development efforts in the Deep South.

.

Nationwide, 1.3% of farm operators in the US are African-American ̶ specifically, 32,938 African-American operated farms.

Mississippi and Alabama are home to 25% of these farms.

“Land Rich but Cash Poor!”

Source

USDA 2007 Census of Agriculture

Mississippi Alabama

Total African

American Total

African American

Total # of Farms 41,959 5,409 48,753 2,789

Average Farm Size 273 acres 113 acres 185 acres 105 acres

% of Farms that earn less than $2,500 in annual sales

53% 56% 46% 53%

Potential

Minority farmers still own substantial amounts of land

Many have much more capacity on the supply side

A robust agricultural supply chain could serve markets both inside and outside the Delta

Some minority (and many white) farmers already export crops and value-added products to corporations (e.g., Mars)

If organized, producers could capture more substantial regulated market opportunities.

Anticipated Results

1. Increase income for all farmers

2. Increase income for low-wealth minority farmers,

3. Capitalize on the increase in statewide vegetable and fruit production

4. Improve, connect and fully utilize existing built capital

5. Increase financial capital within the region.

Implementation Plan

1. Utilize a systems approach to economic development. Use value chains as the vehicle to generate multiple forms of wealth.

2. Assess, plan, and measure the development of value chains by focusing on increasing the eight forms of capital, local ownership and control, and low-income livelihoods ̶ the aim of WealthWorks value chains

A network of businesses, non-profit organizations, and collaborating players who work together to

satisfy market demand for specific products or services.

Because value chains are built in response to market demand

and involve clear and constant communication,

they can be more responsive and innovative than traditional supply chains.

Moves from isolated projects to a systems approach Provides access to larger more diverse markets

Gives farmers the tools, capacities, support and

connections to significantly improve their own livelihoods

Provides opportunities for food & farm entrepreneurs

Creates multiple forms of wealth that is locally

owned, controlled and reinvested into rural communities

Working as network helps to move us beyond single-institution or single-solution approaches

Provides group members with the collective power and support necessary to deepen the impact and expand the scale of their individual efforts.

Creates an opportunity for a regional network to foster collaboration and innovation to improve the livelihoods of rural people in the Deep South.

The long-term development of networked value chains ̶ connecting sub-regional value chains across both states ̶ will lead to greater access to markets, as well as the sustainable supply of products.

Network Benefits

This is the Story of Land, Knowledge, Partnerships and Wealth Creation

Face-to-face visit with each participating organization

Face-to-Face visit with established regional non-profit grassroots organizations:

◦ Southern Echo

◦ Federation of Southern Coops

◦ Children’s Defense Fund

Tour of communities

Meetings with community members

Meetings with local farmers

McIntosh S.E.E.D. and Rural Support Partners compiled the information gained from the interviews and used it as a catalyst to formulate the implementation strategy.

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Research/analyze the various components of the value chain: product demand, production capacity, aggregation/ distribution infrastructure, etc.

Engage, inform, & connect value chain stakeholders

Discover connections, common visions and possible ways project groups can work together

Develop individual & collective action plans

Strengthen our skills, knowledge & capacities

Document tools & lessons to help other groups working to construct value chains

Assessing Processing, Aggregation, and Distribution (PAD)

Customer Demand

Who are potential buyers? Consumers?

What product(s) do the buyers want to buy?

What are the cost factors?

Certification requirements? Grading? Liability?

Environmental impact? Soil samples? EPA?

Bidding Process

Processing

What facilities already exist? Location?

Produce procurement?

Cooling systems? On-site/Facility?

Production

Access to capital?

Current production capacity?

Farm plans?

Labor needs?

Access to land?

Storage capacity?

Transportation?

Aggregation and Distribution

Producers pay system?

Infrastructure: Existing and needed?

What produce can be field processed and what needs to be facility processed?

Project Partners: Cottage House and ASAN Counties in Hot Spot:

• Macon: 127 farms,17,313 acres

• Lowndes: 134 farms, 22,342 acres

• Coffee, Geneva, Houston, Henry, Barbour, Bullock, Montgomery, Lee, Autauga

Value Chain Hotspot #1: Southeast Alabama

Potential Markets and Buyers Include:

Schools & Universities Wholesale Buyers Direct to Consumer

• Wallace Community College

• Tuskegee University

• Barbour County city and

public schools

• Autauga producers in

discussion with Alabama

State University

• Browntown producers in

discussion with Montgomery

public school district

• Dixie - Eufaula AL

• Piggly Wiggly – Clayton AL

• Food Warehouse / Super Save – Ozark AL

• Tiger Food

• Calhoun Foods

• Food Depot

• Food Outlet

• Grocery Outlet

• Save-a-Lot

• Hometown Grocery

• Walmart

• C.H. Robinson

• Cracker Barrel

• Piccadilly

• The Fresh Market – Montgomery AL:

peaches, berries, collards, and kale.

• Cottage House Youth Market

• Clayton Farmers Market

• Clio Senior Market

• Eufaula Farmers Market

• School Road Side Stand

• Fairview market

Project Partners: TUCCA, NWF, Winston County Self-Help Group

Value Chain Hotspot #2: West Alabama and East Mississippi

Potential Markets and Buyers Include:

Institutions Wholesale Buyers Direct to Consumer

• County/City School Systems

• Universities

• Area Nursing Care Facilities

• Area Hospitals

• In two AL counties, Child

Nutrition Directors need a

supply of fresh food for more

than 6,000 students daily.

• White Oak Pastures: farm retails, online

stores, Whole Food

• Tallgrass Beef Company: restaurants,

online and retail stores

• US Wellness (international)

• Fresh Market, AL

• Earth Fare, AL

• Kroger, MS,

• Rainbow Natural Food Co-op, MS

• City Meat in Jefferson County, AL

• Wal-Mart – C.H. Robinson: organic MS

blueberries & purple hull peas

• Cracker Barrel and Piccadilly

• Small local grocery stores

• Highway 45 Farmers’ Market:

Mobile & Baldwin Counties AL

• Community Supported

Agriculture

• Internet Sales

• Wholes & Halfs

• Main Street Birmingham Project

in Jefferson County, AL

Counties in Hot Spot:

West Alabama Counties East Mississippi Counties:

• Green: 118 farms, 24680 acres • Sumter: 166 farms, 26,412 acres • Perry: 134 farms, 13,284 acres • Dallas: 170 farms, 12,941 acres • Wilcox: 155 farms, 10,200 acres • Choctaw, Marengo, Hale: 134 farms, 13,774 acres • Opportunity to move into Mobile, Baldwin and Lauderdale • Birmingham/Jefferson County in the future

• Noxubee: 127 farms, 11,185 acres • Kemper: 129 farms, 20,430 acres • Lauderdale Winston

Project Partners: Children’s Defense Fund, Mileston Cooperative, and Southern Rural Black Women’s Initiative

Counties in Hot Spot:

• Hinds: 228 farms, 24,262 acres

• Madison: 186 farms, 16,542 acres

• Holmes: 198 farms, 25,310 acres

• Humphreys, Washington, Bolivar, Leflore, Quitman, Coahoma, Attala, Yazoo, Sharkey

Value Chain Hotspot #3: Mississippi Delta

Potential Markets and Buyers Include:

Institutions Wholesale Buyers Direct to Consumer

• Delta Health Alliance

• Mississippi Department of

Education

• Mississippi Department of

Health

• Opportunity to move produce

to market at the Washington

County Public Schools in

Greenville.

• Delta Fresh Foods

• Cracker Barrel

• Piccadilly

• 14 casinos across Mississippi

• Walmart - C.H. Robinson: organic

blueberries and purple hull peas

• Roadside stands

• U-Pick

• Farmers markets

Establish a regional network

Develop and move value chains

across the three hot spots

Generate additional value chain

funding & investment

Develop hands-on Value Chain

tools and processes

Identify broader local, regional

and national policies and

systems that help and hold back

these efforts

Phase II: Value Chain Construction October 2012 - June 2013

Pilot: Growing Protocols One growing season and one sub-region

• Farmers A & B followed protocols

exactly, and saw a significant increase

in product yield versus …

• Farmers C & D, who did not.

Livelihood Impact

• Project partners will start utilizing the growing protocols with local farmers

across growing seasons.

• Each will track which farmers are and are not using growing protocols.

• Growing protocols have also begun to forge unprecedented working

partnerships between farmers and horticulturalists from academia –

parties who have not traditionally worked well together in this region.

Launched three fully functioning agricultural value chains

Implemented and documented universal growing protocols

Trained and prepared farmers for GAP and GHP certifications

Partnered with existing aggregators

Partnered with city and county officials

Partnered with Tuskegee University, Tougaloo University, and Alcorn State University

Recruited additional farmers

Gained access to diverse markets

Continue to develop well-managed and sustainable value chains

Increase the participation and income of low-capacity producers

Increase efficiency and sustain The Deep South Wealth Creation Network

Document and disseminate replicable tools and processes

Develop an informed policy agenda and working relationships with regional and national policy organizations

Organized 50 small minority farmers and created entry points to wholesale markets

At close of 2013, in just one year, will collectively have generated over $250,000 in sales of collards greens, turnips, sweet potatoes, cabbages, and pink-eye peas to high-end restaurants, schools, and grocery stores

Started training on a universal farming protocol to maximized product yield

Provided mentorship opportunities for youth interested in agricultural work, closing inter-generational gaps

Begun to create job opportunities within local communities to provide on-farm support

Intellectual • Improved business skills for farmers, new skills to sell into

wholesale markets, and USDA Certification

Individual • Training and implementation of universal growing protocols

and sustainable production practices across the region

Social

• A collaborative network, stronger relationships among farmers

and organizations working across the region, and relationships

with new customers

Natural • New sustainable production practices in the region

Built • Shared access to equipment, establishment of hoop houses,

and reclaimed vacant buildings for processing sites

Political • New understanding of the policies that help or hinder

institutions from supporting growth of local food value chains

Financial • New sources of loan capital identified for the region’s farmers

and connection of value chains to new foundations investors

Capital –Building Results

Local ownership and control

Shared equipment purchases

Shared liability insurance

Market development

New local businesses

Shared labor (i.e., The “Green” Team)

Placed more underutilized acreage into production to meet market demand

Better livelihoods

$250,000 in sales already moved through the value chain

New jobs for young people- and others

New business opportunities for local residents (i.e. sale of transplants)

1) Developing value chains requires significant time and on-the-ground financial resources for both farmers and value chain intermediaries Up-front capital investment is needed for low-income farmers for tools and equipment/Up-front financial support is needed for intermediaries to manage all of the moving parts of the value chain.

2) Developing a regional network to support value chain construction, requires a foundation of trust and relationships between various value chain actors.

3) We’ve discovered a few general best practices for supporting the development of local food value chains:

Work with intermediaries whose organizational focus is in agriculture

Encourage intermediaries to offer ongoing support to farmers

Investing in a local aggregator and horticulturalist can expedite the value chain construction process

Labor is 40% of what groups need for success

MileSton bringing 2 students/farm

The Cottage House utilized prison re-entry program

“Green Team” created and travels farm-to-farm to assist growers with farming needs (e.g., planting, harvesting, equipment operation, training)

Time must be considered

Must develop and bridge a business plan with the needs of the value chain

Marketing, finances, record keeping

Be patient for building structure because the work is so multi-faceted

Want to find a better method for data collection

Important to take data that caters to value chain’s needs

Data also shows farmers that making money is possible, if they follow protocols

Protocols can potentially retain and attract farmers

Once they are informed about the level of demand in the market, compare and contrast profit based on protocols

> Following protocols can increase yield by at least 40%

> Following protocols maximize profits

> It ensures that the customer is getting what they want

Expanding to larger markets such as Belle Foods, Walmart, Sysco, and Red Diamond

Test and documenting growing protocols across the network

Train new farmers and help them attain GAP Certification

Partnering with the COADY Institute to increase visibility and recognition of the Network

Structure and expand Steering and Fundraising Committees to sustain the Network

Pride is returning to our farmers. They’re feeling

ownership.

Partnerships with other co-ops are

developing

A sense of “community” has returned

A New Way of doing economic development that shows positive impacts in the livelihoods

of low-income people living in Rural Communities!