Market trends explored at Colorado ag conference
Market trends explored at Colorado ag conference
GREELEY, CO -- Agricultural commodity producers in Colorado learned more about market trends that can have a positive bottom-line impact during this year's Colorado Agriculture "Big & Small" Conference & Trade Show.
Tom Lipetzky, director of the Division of Markets of the Colorado Department of Agriculture, was the keynote speaker at the event, talking on the topic, "Today's Driving Trends and How You Can Position Your Operation to Benefit from Today's Trends."
Mr. Lipetzky addressed attendees Feb. 21 at the Island Grove Park, here. The four-day event was comprised of the Colorado Organic Producers Association Farm Tour, the Colorado Organic Conference, Colorado Produce Conference and Small Acreage Conference.
According to Mr. Lipetzky, five trends are shaping today's marketplace. First is the rise of what Mr. Lipetzky termed the locavore. "More consumers are seeking out locally grown product," he said. "There's a perception that local means fresher."
He went on to say that consumers are becoming more knowledgeable about the concept of food miles, and increased interest in local product has also translated to increased interest in organic product.
In response to a survey conducted by CDA in June 2006, Mr. Lipetzky said that 92 percent of respondents indicated they would buy local product if it were available. Referring to the same survey, he noted that respondents said having input about agricultural producers and products is important to them.
This is the 24th year that CDA has published its annual "Colorado Farm Fresh Directory." Mr. Lipetzky told attendees that the directory is gaining in popularity as a resource for consumers and retailers. Directory listings provide information about Community Supported Agriculture Farms, farmers markets, greenhouse operations, on-farm sales, roadside markets, U-pick operations, and whether product is conventional or organic certified. Detailed information about specific commodities is also included.
In the late 1990s, he said, 30 agricultural producers were listed in the directory. The number swelled to 70 in 2007.
"[Among restaurants], locally grown produce ranked second in food trends," Mr. Lipetzky said. "Organic ranked third. Retailers are investing significant dollars to promote locally grown [product]."
The second significant market trend is food safety. According to Mr. Lipetzky, stories about food contamination are becoming more prevalent in the media. "All this is raising the anxiety for consumers," he said. Retailers and wholesalers are looking for product branding and source/process verification. "The number of branding products is expanding," he said.
Sysco, North America's leading foodservice marketer and distributor, has adopted third-party certification for all suppliers, and Mr. Lipetzky said that Wal-Mart is expected to follow suit in the near future.
"All this develops an opportunity to create for consumers," he said of company stories about specific commodities, which can be used as marketing tools to address food safety standards and practices.
The third market-shaping trend is technology. Mr. Lipetzky said that the ease of technology access and associated low costs give producers a way to reach more consumers. This summer, CDA will launch "Market Maker" to help connect Colorado consumers and producers. The project is a joint venture with Colorado State University and will replace the existing agriculture supplier directory. The database will be searchable, and Mr. Lipetzky said that these searches can be customized and highly refined to get people the information they need about locally available product. A mapping function will also be included to locate producers.
"We're excited about 'Market Maker'," he told the audience.
Mr. Lipetzky said that producers should not overlook the fourth market trend: global opportunities. "One of every three Colorado food and agricultural companies sells to the international market," he said, adding that 95 percent of the world's customers are located outside the United States. "This may very well be an opportune time to consider the foreign market."
Last year, he said, the Centennial State sold $900 million in agricultural commodities to international markets.
The final trend Mr. Lipetzky spoke about was the revamping of the farm bill. "In many ways, the farm bill will be historic," he noted.
The reauthorization is expected to provide mandatory funding for the Farmer Marketing Assistance Program and the Specialty Crops Block Grant Program. "That could translate to half a million dollars coming to Colorado for fruit and vegetable producers," he said.
To capitalize on these major market trends, Mr. Lipetzky encouraged participants to become members of the "Colorado Proud" program. Membership allows producers to use the "Colorado Proud" logo on commodities. The program currently has 900 members statewide. According to Mr. Lipetzky, the logo has a recognition rate of approximately 66 percent among Colorado consumers.
Other driving forces affecting market dynamics include water policy, land use and immigration, Mr. Lipetzky added.
He concluded his presentation by saying that Colorado agriculture continues to change, and these changes can work for the state's producers.
Tom Lipetzky, director of the Division of Markets of the Colorado Department of Agriculture, was the keynote speaker at the event, talking on the topic, "Today's Driving Trends and How You Can Position Your Operation to Benefit from Today's Trends."
Mr. Lipetzky addressed attendees Feb. 21 at the Island Grove Park, here. The four-day event was comprised of the Colorado Organic Producers Association Farm Tour, the Colorado Organic Conference, Colorado Produce Conference and Small Acreage Conference.
According to Mr. Lipetzky, five trends are shaping today's marketplace. First is the rise of what Mr. Lipetzky termed the locavore. "More consumers are seeking out locally grown product," he said. "There's a perception that local means fresher."
He went on to say that consumers are becoming more knowledgeable about the concept of food miles, and increased interest in local product has also translated to increased interest in organic product.
In response to a survey conducted by CDA in June 2006, Mr. Lipetzky said that 92 percent of respondents indicated they would buy local product if it were available. Referring to the same survey, he noted that respondents said having input about agricultural producers and products is important to them.
This is the 24th year that CDA has published its annual "Colorado Farm Fresh Directory." Mr. Lipetzky told attendees that the directory is gaining in popularity as a resource for consumers and retailers. Directory listings provide information about Community Supported Agriculture Farms, farmers markets, greenhouse operations, on-farm sales, roadside markets, U-pick operations, and whether product is conventional or organic certified. Detailed information about specific commodities is also included.
In the late 1990s, he said, 30 agricultural producers were listed in the directory. The number swelled to 70 in 2007.
"[Among restaurants], locally grown produce ranked second in food trends," Mr. Lipetzky said. "Organic ranked third. Retailers are investing significant dollars to promote locally grown [product]."
The second significant market trend is food safety. According to Mr. Lipetzky, stories about food contamination are becoming more prevalent in the media. "All this is raising the anxiety for consumers," he said. Retailers and wholesalers are looking for product branding and source/process verification. "The number of branding products is expanding," he said.
Sysco, North America's leading foodservice marketer and distributor, has adopted third-party certification for all suppliers, and Mr. Lipetzky said that Wal-Mart is expected to follow suit in the near future.
"All this develops an opportunity to create for consumers," he said of company stories about specific commodities, which can be used as marketing tools to address food safety standards and practices.
The third market-shaping trend is technology. Mr. Lipetzky said that the ease of technology access and associated low costs give producers a way to reach more consumers. This summer, CDA will launch "Market Maker" to help connect Colorado consumers and producers. The project is a joint venture with Colorado State University and will replace the existing agriculture supplier directory. The database will be searchable, and Mr. Lipetzky said that these searches can be customized and highly refined to get people the information they need about locally available product. A mapping function will also be included to locate producers.
"We're excited about 'Market Maker'," he told the audience.
Mr. Lipetzky said that producers should not overlook the fourth market trend: global opportunities. "One of every three Colorado food and agricultural companies sells to the international market," he said, adding that 95 percent of the world's customers are located outside the United States. "This may very well be an opportune time to consider the foreign market."
Last year, he said, the Centennial State sold $900 million in agricultural commodities to international markets.
The final trend Mr. Lipetzky spoke about was the revamping of the farm bill. "In many ways, the farm bill will be historic," he noted.
The reauthorization is expected to provide mandatory funding for the Farmer Marketing Assistance Program and the Specialty Crops Block Grant Program. "That could translate to half a million dollars coming to Colorado for fruit and vegetable producers," he said.
To capitalize on these major market trends, Mr. Lipetzky encouraged participants to become members of the "Colorado Proud" program. Membership allows producers to use the "Colorado Proud" logo on commodities. The program currently has 900 members statewide. According to Mr. Lipetzky, the logo has a recognition rate of approximately 66 percent among Colorado consumers.
Other driving forces affecting market dynamics include water policy, land use and immigration, Mr. Lipetzky added.
He concluded his presentation by saying that Colorado agriculture continues to change, and these changes can work for the state's producers.
