Price setting, Part 1

The past few months have been a whirlwind of journalism conferences and travel. The last stops were Sicily and Istanbul, to places that made me think a lot about food, where it comes from and what we do with it. It’s hard to write about the experience and not sound like everyone else who visits Italy. But I’ll say it anyway: fresh, local food is paramount and available and, most importantly, affordable.

Here is a daily market in Palermo where the clams are so fresh they squirted water at me when I peered into the tub of water they floated in.

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In Ortiga, an island off of Syracuse at the eastern tip of Sicily, we stopped at a market stall for fresh oysters the size of a grown man’s palm and a glass of sparkling white wine — for €1.50 a person.

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The next day, they were splitting open sea urchins and scooping them out of their spiny purple shells, dousing them with a squeeze of lemon and serving them up. They were bright orange and salty.  We found a ricotta cheese that was baked, called ricotta infornata, braised brown like a loaf of bread on the outside and creamy on the inside. It was perfect with a stack of broiled peppers another merchant was selling for a few euro.

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In Lipuri, a tiny island off of Sicily, four custard and ricotta filled pastries and three cappuccini for breakfast cost €11. A lobster freshly cooked at Filipino’s cost €9. I kept wondering why the wine was expensive until it occurred to me that the prices were for bottles not by the glass. Even at one of Syracuse’s busiest restaurants, Sicily in Tavola, a fantastic white cost €13 for a bottle.

Here, you can get a glass of wine for that price and even one cappuccino would be nearly half that. Actually, we ordered two cappuccini and a pesto/hazelnut morning bun at Verve in Santa Cruz a couple days after we got back from Sicily and the price was $15. The morning but cost $5.50 alone. “We could have three arancini for that,” I muttered walking out to a table the cafe had set up in a parking lot. Everything felt bland and big after being squeezed into streets so slim two people have to brush up against each other to pass by.

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The Slow Food movement had a lot to do with the marketing and revitalization of Italy’s food traditions, as well as improving the quality of products like olive oil and balsamic vinegar. But the movement was working with an infrastructure. Every morning in Canetto, a hamlet of Lipuri, a fish vendor would roll up in his mini-truck with the day’s catch. He parked outside Sisa, Canetto’s only supermarket.

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But food is less expensive than here everywhere I have traveled in Italy.  Even when the Euro was stronger than the dollar, we spent less money on food, whether in restaurants or from produce markets. Even in Florence and Rome. Subsidies play a part. But food in the United States is also subsidized and the quality is nowhere nearly as good. So why is our food so expensive in the United States? One argument is that we pay more for pasture-raised meat and organic produce, we are paying the real unsubsidized price of food. That the market is distorted because of ag subsidies and consolidation. But it’s not that simple. It’s not uncommon for growers to set their prices at farmers markets based on the income of the neighborhood. You can buy the same bottle of olive oil or honey for less depending on where the market’s located. So who sets the floor and ceiling of prices?

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Why did Big Ag giant Cargill get $5 billion from Congress?

To my surprise, Cargill showed up on the list of the top 100 companies that dominate federal subsidies along with corporations like Bank of America and the Bank of Ireland.

Cargill ranked #93 on the list of corporations that receive federal loans, loan guarantees and bailout assistance and stands alone as the only ag-related company. Their total take was $5.1 billion. The closest neighbors on the list: #94 Synovus Financial. #92 is Best Bank.

I am just starting to check on the figures and why Cargill needed $5 billion in subsidies when the company boasts of being one of the world’s Pillars of Plenty
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The story of how Big Ag fought Obama and won

Here is a transcript (and a recording) of the beginning of the end of what would have been the toughest challenge to mega livestock and poultry corporations like Tyson and Cargill.

It was July 20, 2010 and USDA officials were nervously defending legislation at a hearing of the House Agriculture Subcommittee on Livestock, Dairy and Poultry. Most of the congressmen come from farm states, had ranches of their own in the family and had filled their re-election accounts with money from the very companies fighting the proposed laws.

The controversy started when the USDA tried to level the playing field for poultry farmers and ranchers using the agency’s authority under the Packers and Stockyards Act, a 1921 law whose power to give growers a fair deal had been growing thinner by the decade. The congressmen bristled at the provisions, which members said usurped the power of Congress. Now those provisions were back.

It’s worth noting that at the time President Obama was looking at whether Big Ag was violating anti-trust laws. Even as the USDA officials were sweating it out, their boss, Tom Vilsack, was touring rural states across the country with the head of the Justice Department, Eric Holder, and his anti-trust chief Christine Varney. Obama had sent them out to hear from farmers and ranchers about how to restore competition and fairness to farming. The trio of the USDA and DOJ was the last combination Big Ag, the packers and producers, wanted to see working together. They quickly dispatched their lobbyists. You could hear echoes of the industry’s lobbyists in the comments and questions of the subcommittee on July 20. One of the lawmakers said he regretted that farmers were having to consolidate in order to stay on the land but that’s just the way it is. Get big or get out. uncle-sam-food-garden-mid As The Grist’s Tom Laskawy put it, “To say this was a lost opportunity is a vast understatement. After all, the top four companies control 90 percent of all beef processing. In the case of pork, four companies control 70 percent of the processing, while for poultry it’s nearly 60 percent. When you get that kind of market power,* abuse becomes rampant. Indeed, ranchers all around the country now agree that it’s impossible for them to get a fair price for livestock.”

Salty Food and Belching Cows Are Winners in Budget Deal

Farmers and ranchers came out smelling pretty Saturday in the massive $1.1 trillion spending bill on its way to the desk of President Obama even though they will not have to curb the emissions of their cows or report about the effect of said emissions on the environment.

And we’re not even talking about the Farm Bill.

Farmers and ranchers were spared having to report on pollution from manure in the $1.1 trillion U.S. spending bill on its way to President Obama, according to New York Times coverage.

The gift comes in the form of a provision that says the government cannot require farmers to report “greenhouse gas emissions from manure management systems,” the Times reported:

Nor can it require ranchers to obtain greenhouse gas permits for “methane emissions” produced by bovine flatulence or belching.

The spending bill requires the E.P.A. to withdraw a new rule defining how the Clean Water Act applies to certain agricultural conservation practices. It also prevents the Army Corps of Engineers from regulating farm ponds and irrigation ditches under the Clean Water Act.

“This is a major victory for farmers and ranchers, who consistently tell many of us that they are concerned about the potential of the E.P.A. and the Army Corps of Engineers’ overreach into their operations,” Representative Mike Simpson, Republican of Idaho, said.

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Meat and methane
Mike Licht, NotionsCapital.com

In another food-related provision, the bill included a slap in the face to First Lady Michelle Obama’s push for higher nutrition standards by prohibiting the federal government from requiring less salt in school lunches and allow schools to obtain exemptions from whole-grain requirements for pasta and tortillas. “But they were a victory for food companies and some local school officials, who had sought changes in regulations that are taking effect over several years.”

USDA “setting the record straight” about inspectors

I was working on a story about how pasture-fed ranchers in California have been hit by the drought and the closing of Rancho. Accessibility to USDA slaughterhouses and especially USDA cut and wrap operators is creating a bottleneck. Consolidation, environmental rules, NIMBY (no way am I going to have a slaughterhouse in my backyard!) and federal regulations are part of the picture, according to a 2009 Food and Water Watch report, “Where’s the Local Beef.”

The authors wrote that USDA regulations are skewed to support corporate giants like Tyson, Smithfield and Cargill that can afford expensive techniques and equipment now part of government inspection requirements. USDA inspectors begin with a live animal and end with a carcass. But beginning in the 1990s, the USDA also required facilities to have food safety plans for each segment of their operation, which inspectors audit. The decision put food safety in the hands of the operators running the plants and reduced USDA oversight “beyond what was prudent and necessary for the protection of the consumer,” according to a 2000 review by the USDA’s Office of Inspector General. Here is the USDA’s Inspection 101 publication.

I asked Food and Water Watch’s Patty Lovera about how USDA staffing plays into problem. She said “They stand out in the budget,” she said, meaning the inspectors. “They have a target on them.”

Staffing is a problem, she added, “but it varies in different parts of the country. There are some USDA districts that suffer chronic inspector shortages and that’s where you hear about them having to visit multiple processing plants in a day, just to say they were there every day, but not spending a lot of time to really see what’s going on.”

I left all that out of my story. I knew nothing about the storm being kicked up by Food and Water Watch and a NY Times story, which elicited a strong response from the USDA. They refuted any suggestion that they are short-staffed and that staffing has anything to do with food safety concerns or the Rancho recall.  (It appears the NY Times has been a thorn for a while and just fyi, FSIS is an arm of the USDA.)

The question is how many inspectors are enough. Here are the numbers: USDA regulations are enforced by 7,800 inspectors responsible for overseeing the safety of billions of pounds of meat and poultry — 92.3 billion in 2011 — produced by 6,200 USDA-certified plants in the United States. (This, by the way, is all I ended up putting in the story. I  try to avoid getting stuck in the middle of arguments by considering the numbers, especially when I don’t have enough time to dig into the records and talk to operators at length before going to print.)

Here is the email from USDA and the response:

Good Afternoon – Recently, advocacy groups have alleged that fluctuations in food safety inspector staffing levels have led to food recalls and compromised food safety. FSIS posted a response to these false statements on the USDA blog at the link below. You are welcome to retweet this story as is or use the content in your own publication.

Here is what Aaron Lavallee, FSIS Deputy Assistant Administrator for the Office of Public Affairs and Consumer Education, wrote:

Recently, the New York Times published an article claiming that job vacancies in the Food Safety and Inspection Service (FSIS) are leading to more food recalls. That’s not true.  The fact is, vacancies within the agency do not mean there are less inspectors on the job in our nation’s meat plants.FSIS is legally required to have a sufficient number of inspectors present in every single meat and poultry plant in the country.  No plant in America is allowed to operate if it does not have the required number of safety inspectors in the plant at all times, and every plant currently operating in America has the necessary food inspection staff.The New York Times article was based on misleading and inaccurate information, and to the paper’s credit it ultimately ran at least a partial correction.  The article was supposedly based on data from a Freedom of Information Act (FOIA) request by an outside group called Food & Water Watch-but Food & Water Watch had not yet received that FOIA report.  Yet, they told the Times they had received it, and the Times unfortunately reported faulty information without verification.The FOIA referenced in the article is actually just being released today.  You can view it here. The report will show that, at the end of Fiscal Year 2013, there was a vacancy rate of 7.08% among FSIS’ inspectors. Food & Water Watch claimed, and the New York Times reported, that inspectors in the Raleigh District faced an 11% vacancy rate. In fact, the vacancy rate there is currently 8.27%.Like all organizations, FSIS has a vacancy rate that fluctuates as inspectors leave work or retire.  FSIS is working to fill open positions. FSIS always prioritizes food safety inspection and dedicates significant resources toward ensuring that all plants have the required number of inspectors.  Again, if a plant does not have enough inspectors, it is illegal for that plant to operate.It is irresponsible to attempt to confuse FSIS vacancy rates with plant inspector shortages and then imply that meat and poultry products are less safe as a result.  There is no connection between recent recalls and FSIS vacancy rates, and any claims that these issues are linked are false.

A new generation of farmers fighting for land in California’s parched wine country

 Rains may yet head off a full-blown drought crisis in Sonoma County. But no amount of water will solve one of the toughest problems facing America’s most picturesque, productive and pricey farmland regions. That is getting new farmers access to land.  Listen to the Story

It’s a late Saturday afternoon and the sky has been darkening all day, casting Sonoma County in a sheet of gray the color of cement. The sky means rain and that’s good news to the farmers here at the Sebastopol Grange Hall. California is in a drought, the worst in recorded history. Reserve ponds are drying up and the pastures are brown and barren.

Dairy farmers and ranchers are cutting into their slim profits just to feed their herds. They’re culling deep into their stocks, selling or butchering entire herds. The organic dairies worry they won’t be able to sell their milk because they can’t pasture the cows much longer. A liter of organic milk from one of nearby dairies already goes for $5. The ranchers have it even worse with the shutdown of the only USDA slaughterhouse within a three-hour radius. You can’t have grass fed beef and lamb without pasture. And now they’re feeding their herds and having to drive further to slaughter. This might be enough to make any farmer get out of the business. But these new farmers in skinny jeans and flannels were here because they wanted in. To farm they need land. And in Sonoma County that’s a big problem. With the average age of farmers now at 59, it’s a problem that reaches deep into the future of farming in America. IMG_1797

That’s why I have come to the Sebastopol Grange Hall, a one story sage green building on Highway 12 that runs through grasslands dotted with wooly white sheep and row after row of grapes grown for some of the country’s best known wineries. The temperature was dropping when I arrived and the wind whipped the edges of a white tent pitched outside, behind the hall. Inside the hall, a stream of women threw open their arms and lurched up to hug a man who turned out to work for the USDA, the agency that oversees our food system. Normally this would be enemy territory for the USDA. But his long blonde hair and big eyes seemed to melt resistance. “Hey! Glad to see you in the big city,” one woman said, laughing. Sebastopol is hardly a metropolis but compared to a farm, it can seem like jarringly busy.

IMG_1800They sipped glasses of Mission Hardware Old Sonoma Red and Highway 12 Sauvignon Blanc, named for the road that connects the town with the rest of Sonoma County. This was the annual meeting of the Farmers Guild, an organization catering to young farmers trying get started. So it wasn’t surprising that these young agriculturalists looked more like baristas in the Mission District in San Francisco than our classic image of farmers “straight white men on tractors” as one woman put it. No one showed up in dreadlocks but they wouldn’t have been out of place. A few wore cowboy boots but if there was a cowboy hat it would have been an ironic flourish. The crowd held plates piled with salad greens, pulled pork and meat-free maple sausage — all organic and local of course, from a place called the Happy Pig Farm.

Evan Wiig, the organizer of the event, was trying to round up the crowd for what he called farmer speed dating.IMG_1795 “This is chaos,” he said, ringing a cowbell. “It’s like herding cats.” The first time I met the red-haired Wiig he was dressed in a three-piece plaid suit that looked like it came straight from the rack of a vintage store. He wore cowboy boots and a straw cowboy hat. He left the New York publishing world for a 600 acre farm where he raised chicken and now lives on the Green Valley Village cooperative. He has 17 pigs including the litter born that morning.

“I am not sure people will be reading books in five years but they’re still be eating,” he told me on a January afternoon. The sky was cornflower blue and yaks and cows bellowed in the field behind us. The breeze made the grapevines curled around the trellis above us move just slightly. Most small growers have to subsidize their earnings with a second job or marijuana he said. “Cause you ain’t eatin’ local otherwise,” he said.

Land in Sonoma County can go for tens of thousands of dollars an acre, more if a vineyard is planted there. That’s out of reach for young farmers. “The cost of land is the number one obstacle,” Ariana Areguzzoni told me. She works for California Farm Link to help new farmers get access to land and capital. Rent and housing prices skyrocketed, she said. “And that’s really spilling over to ag land.”

People who have land to sell are holding on to it because they know they’ll get more money from a developer than a farmer. Ask anyone who has lived in Sonoma County long enough and they’ll tell you land is expensive because of city slickers moving in from San Francisco or Silicon Valley. They are chasing a back to nature fantasy of owning some land and planting a few acres of grapes to make their own wine. Vineyards are “in a whole different economic bracket. They just have more access. They have more options,” Ariana said. Some of them want to show off to their friends or make a little money. IMG_1804

The county’s agricultural commissioner, Tony Linegar, called it a dangerous hobby because when the prices of grapes go down they give them away. There are growers who rely on their grapes to make a living. Linegar said the hobbyists don’t have bonds to the community. They pick up after a few years when they get bored or disillusioned — or both — and sell off their land — for ever more money. It’s a $14 billion industry. “There’s a lot of money involved and a lot of influence,” Linegar said.

Even families whose ties to the land goes back to the Spanish-Mexican days couldn’t buy an acre today. They call themselves land rich and cash poor. The new farmers at the Grange are mostly just poor.

Like David Cooper. He works the Oak Hill Farm in Glen Ellen, a storied piece of land profiled in the book “Field Days.” Oak Hill’s 700 acres are protected because they are of the Sonoma Land Trust. Cooper could never afford to buy into Sonoma County. “Not in this area. Not a chance,” he said. It’s so expensive someone starting out couldn’t make enough money to cover the mortgage. Paul Wirtz and Bob Cannard, two of the country’s leading organic agriculturalists probably couldn’t afford their land either if they were getting started today, he said.

Owning the land means security and not losing the value that farmers put into the soil and surroundings. But Evan, David and the others like them know that 80 percent of the nation’s land is held by non-farming landlords. If you’re getting started you rent. But just getting capital to start is an uphill battle. “It’s not worth your time to talk to a bank,” a red-haired former software executive said. There are option, like Slow Money and Farm Link.

It seems like a pretty hopeless picture and land prices are troubling, which is why they’re playing a game of speed dating, after all. Yet these are some of the most optimistic people I’ve ever met. Farmers like Andrea Davis-Cetina.

She grows organic vegetables and popcorn on her Quarter Acre Farm in the Sonoma Valley. She studied agriculture at Hampshire College and started her own farm “because no one else would hire me.” Six seasons later she has expanded to three-quarters of an acre. She’s optimistic but said part of the problem is the lack of connection shoppers have with farmers. Fewer than 2 percent of Americans farm. “So it’s understandable people don’t know what a farmer looks like because they don’t know one,” she said. But to make the local food movement work shoppers need to shop from one, Andrea said. “No middle man” she said. “Get to know your farmer,” David added. They turned and walked back in side. A few minutes later the sky opened up and raindrops pinged off the cars like tin bullets.

It was a welcome sound.

First came the drought then the USDA forced Rancho in Petaluma to recall 9 million pounds of meat. I’ve been sprinting to keep up. There is so much to tell. I honestly don’t know where to find the time to write about it all for a few more days. But even though I might be invisible at times here, you can keep up with everything on Twitter —@GleasonRanch — and Facebook/gleasonranchfilm.

Here are some photos from yesterday. David Evans of Marin Sun Farms bought Rancho in record time — with some Silicon Valley tech VC dollars. A worker was already painting over the sign yesterday. IMG_1863

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Here is an interview with Evans about the recall.

Livestock growers from Mendocino, Marin and Sonoma counties I spoke to were, as one of them put it, “cautiously optimistic” about the deal because Evans now has tremendous control over the system. Translation: Evans is doing what many of the big players do: integrate all points in the process, from growing to slaughter to marketing. That’s good business but the big worry is whether, in time, he will squeeze out the independent producers. The drought was bad enough: How do you raise pure grass fed beef and making a living if there’s no pasture and you’ve culled as much as you can afford, plus you’re having trouble finding organic hay — expensive organic hay. Livestock growers are burning through gas and dollars driving to get to a slaughterhouse/cut and wrap operation. That’s not what the local food movement was supposed to accomplish. But such is the dilemma the Rancho closing created. Poultry is another story: in Northern California you go to Modesto or nowhere.

I haven’t asked Evans all these questions yet but I have been pestering his press rep for some phone time.

The recall and the takeover were the topic of conversation at the Farmers Guild meeting last night at Shed in Healdsburg (and btw walking into Shed is like being in some kind of food sensory nirvana; the place just makes you feel gorgeous and rich and like life is best with a bottle of Chardonnay). The Guild invited Evans but I think everyone understood he was busy. Still things have moved so fast, are still moving so fast, that there are many questions left unanswered about how this affects the local food system they are trying to weave. There were enough questions without the Rancho recall. Now…

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Rancho meat recall, California drought, open questions

What’s local in a CSA?

I forgot to take photos of week 1 of the CSA delivery. These are from week 2 but it is similar and includes the once-a-month meat delivery. The vegetables confused me because the band holding them together is labeled “County Line Harvest Farms/Organically Grown in Thermal, CA. USA.”

I didn’t even know where Thermal was. This is how the County Line website describes the farm: “County Line Harvest is a certified organic farm with two locations in California: one in Petaluma, Marin County, and one in Thermal, Riverside County.” I thought I was dealing only with one farm, the one in Petaluma until I looked more closely at Tara Linda’s website and read that they source from several producers, such as Strauss (along Hwy 116 in Petaluma) for dairy. Tara Linda supplies the meat. Lesson one.

But the greens and carrots were noticeably different from even the organics at Berkeley Bowl and Whole Foods. They cook differently too. I’m beginning the understand that is because of what Michael Pollan calls “supermarket organic.” The way a lot of the organic food we pay dearly for at Whole Foods etc. is grown resembles industrial farming only without (all) the chemicals. Clever marketing but hollow in the end. I’m even hesitant to say that CSA was better for fear that I’m being duped and if I were to visit the farm wouldn’t be much different than the ones supplying the big chains. And Riverside County isn’t what I think of as local. That makes me worrry.  I got a recommendation for Clark Summit Farm as multigenerational, authentic. But you can see from their How-to Buy guide they’re not as consumer friendly as Tara. And no vegetables.

Tara Firma is slicker and a different beast than Clark or Gleason. But I trust Tara Firma and the ranches are doing good work. Maybe I’m getting too wrapped in the minutia of this stuff. It’s just that I wanted to have confidence in my decision and that, as I said earlier, I am not getting slow-washed. I wanted the easy way out, I admit it, without driving to Riverside County for a scheduled visit (no drop-ins).

Postscript: I cancelled my vegetable order. I was not seeing the quality of other CSAs I looked at online or growers at the farmers’ market. And there’s only so much Russian kale I can eat. I made the best bistro beef stew from the chuck loin and carbonara from the bacon.