For a long time now, we’ve advocated for local families to support local food systems.
During this time, local food prices have seemed high relative to conventional food prices as the global food conglomerates were able to sell food internationally without having to factor in the hidden cost of cheap labour and environmental degradation. But now that conventional food prices have started to soar, we all have the opportunity to see the real cost of imported fruit, vegetables and meat.
Food is a commodity, and as such, its price is calculated based on scarcity. When there’s lots of food, prices goes down. When there is very little food, prices go up. While this should be a simple reality, the truth about food prices is further confused by government subsidies and tariffs which may artificially create scarcity or abundance to control prices. The government plays a big role in keeping the livelihood of farmers stable and fair. By intervening in market forces, government bodies ensure that prices of important commodities are supported from the bottom: that is to say, they are prevented from bottoming out. This weaves a safety net for farmers, ensuring their season’s work will always bear enough income to support their families.
Buying local weaves a similar safety net for farmers. By visiting farmers’ markets, choosing local cheese, dairy and produce at the grocery store and registering for a CSA, each of us is deciding to spend our food budget close to home. By doing so, we ensure that the farmers close to us have a reliable income and promising future: enough incentive to grow more food for us in the future. For the sake of this discussion, we’re focusing on pricing. Is it fair to say that local food will taste better too? We think so, but that will have to be a separate blog post. West Side Beef buys all its meat directly from small, Southern Ontario farmers. Indeed the very concept of buying a share of WSB is built around the necessity of sharing the land, the food from that land, and the income that is generated in urban centres from the non-agrarian enterprise.
So how does buying local affect our food budget? If the food we buy is shipped from a different country, there are more market forces at work than just supply and demand. In these cases, both currency fluctuations and the price of oil will determine the price of food. Shipping food long distances gets more expensive as the price of oil goes up. Now that the price of oil is going down, we should be paying less for imported food. But we aren’t.
Part of the issue is that Canada is a petroleum-based economy. Oil is at record lows and this has dragged down the value of the Canadian dollar. If you’ve been buying chicken, pork and beef from the grocery store and those products are coming from the United States, you need a lot more Canadian dollars to continue to buy them at the same American price. When fuel prices were high, we were all told that we would see relief when fuel prices lowered. Fuel prices were blamed for high food prices. But now that fuel is low again, there is no relief in sight. Unless, that is if you’ve been buying local. Buying local combats fluctuations of oils price and other factors determining the price of food. When the food you buy is not tied to a global economy or even cross-border currency trading, you can build a family food budget that makes sense year over year.
But finding local food that is purposefully decoupled from global markets is not always as easy as it sounds. Just because a food is grown in Ontario does not mean it is priced without influence by the global market. A lot of beef in Ontario is sold internationally. The price of this Ontario beef goes up and down based on the commodity stock Index. In fact, food prices are impacted by the sale of “food futures”. Yes, there is an index where traders go short or long on the future price of food: and the ups and downs of that index determine the price of food and national grocers. The traders would have you believe that India, Brazil and China will soon eat so much food that Ontarians should and will soon pay more for pork chops.
If traders of food futures are predicting that prices should go up, how is WSB able to lower prices? Well, there are a few reasons. The first is that we’ve done a lot of leg work over the past year to line up our procurement with farmers that believe in local food systems. There are lots of farmers in Ontario that know too well that what goes up must come down. Beef, pork and chicken prices have seen disastrous price collapses in the past 20 years and while that seems like a long time, it is certainly within the working life of our farmers and they know that the current high global food prices don’t offer them long-term security. And long-term security is the bread and butter of farming. When your main asset is soil health, bankruptcy can undermine more than your bank account. Our farmers see the value in taking fair and sustained prices for a commitment to buy long-term.
I’ve been buying local meat for over 10 years and my grandfather was a cattle farmer in Woodstock. Our farmers know we pay well, we pay on time, and we demand the best product – slowly raised meat that is born and fattened on the same land as the feed they eat. Our farmers would rather secure a long-term relationship to a local market that is not fleeting in its commitment. We won’t chase cheap prices south of the border if they return — our farmers know that because we’ve been with them through that experience the last ten years. They also know we have a commitment to delicious food and we’ve often brought our farmers samples of their livestock, cut the way we prefer. Showing them how good their product is, visiting often, and paying consistently are hallmarks of our relationship.
If you’ve been buying local food for the last ten years you’ve been told that the temptingly cheap food prices at the national grocers were unsustainable. You’ve been told that this cheap food did not fairly represent the cost of exploited international labour standards and the incalculable environmental impact of large scale farming. And if you’ve been buying local for ten years, that extra money you’ve been paying was an investment in the food you should now be buying for the same price, if not cheaper, than the imported counterparts. The farmers you’ve been supporting through local markets, vegetable CSA’s, and meat-share programs like WSB are still around thanks to your support.
This brings us to the second reason we can lower our prices: volume discounts. Thanks to your continued support and willingness to tell your friends about our program, we are buying and selling more meat. And yes, market principles like buying power and volume discounts can function in the consumer’s favour, even at the local level. As our little local engine gathers steam we can share that momentum with all of you. In short, we’re lowering prices as a way of celebrating a breakthrough moment for local food. We now get to champion the positive impact of local food on your family’s budget. Keep passing the word on to your neighbours and friends. The larger our community grows, the more impact we have on our local food prices.
The third reason we can keep our prices lower than our competitors is because we buy whole animal. When you buy only one part or cut, you pay more as the farmer needs to make sure that they can cover their costs for the whole animal when they only sell some of the parts and then has to grind the rest. When we buy the whole animal, we are paying for the costs of raising that entire animal all at once, and thus the farmer gives us a better price.
