The USDA has long championed the growth of local and regional food systems through programs like the Value-Added Producer Grants, Farmers Market and Local Food Promotion Grants, and Regional Food System Partnership grants. Recent evaluations and data from the 2022 Agricultural Census offer a clearer picture of the impact these investments have had on regional food economies, showing significant growth in both the number of farms engaged in local food sales and the revenue generated from these markets.
The 2022 Census reveals a promising increase in local and regional food systems, highlighting a 16% increase in direct-to-consumer sales since 2017, amounting to over $3.26 billion. Despite fewer farms reporting direct sales due in part to a general decline in the total number of farms in the U.S. the value of these direct sales has risen dramatically, marking a 150% increase since 2012. The percentage of farms reporting direct sales, however, remained relatively stable, hovering around 6% of all U.S. farms. This shows that while the number of farms engaged in direct sales may have decreased, the financial impact of these sales has grown significantly.
In addition to direct-to-consumer sales, there has been a notable rise in sales to retail markets, institutions, and food hubs for local or regionally branded products. In 2022, 60,332 farms reported over $14.2 billion in sales to these markets an increase of more than $5 billion since 2017. This growth is a strong indicator of the rising demand for locally sourced foods and suggests that regional food systems are benefiting both farmers and consumers. The number of farms reporting local and regional sales more than doubled from 2017 to 2022, increasing from just under 1.5% to over 3% of all farms in the U.S.
The success of these food systems is rooted in their economic impact, as spending in regional food markets acts as a multiplier, boosting local economies. Each dollar spent in these systems has far-reaching effects, benefitting not only the farmers but also other community members. The growth in local food systems also creates more resilient markets and offers healthier food choices for communities. As farmers engage more with these markets, they diversify their income sources, which helps buffer against market volatility and contributes to the long-term sustainability of their operations.
Programs like the Farmers Market Promotion Program (FMPP) and the Local Food Promotion Program (LFPP) have played a key role in supporting these developments. The FMPP helps establish or expand farmers markets and supports consumer outreach, while the LFPP strengthens the infrastructure needed for regional food systems, including aggregation, storage, and processing facilities. These investments have allowed farmers to reach more consumers and expand their market reach, fostering the growth of local food economies.
The 2022 Census also shows encouraging trends in revenue growth for farms involved in direct sales. A greater percentage of farms that engage in direct-to-consumer sales are earning higher revenues, with the number of farms generating $10,000 or more in direct sales rising from 14% in 2012 to over 21% in 2022. Additionally, farms with local or regional sales have seen growth in the $1,000 to $49,000 revenue categories. This suggests that while many farms still see relatively modest revenue from direct sales, there is a growing number of farmers earning more significant income through local food channels.
Another promising development is the increase in the number of farms reporting value-added product sales. From 2017 to 2022, the number of farms selling processed or value-added goods rose by 13%, with the value of those sales growing by 42%. As the overall number of farms in the country has decreased, the proportion of farms reporting value-added sales has increased, signaling that farmers are increasingly tapping into opportunities to add value to their products and generate additional income. Programs such as the Value-Added Producer Grant (VAPG) are instrumental in supporting this trend by helping farmers fund the business planning, processing, and marketing of value-added goods.
The rapid growth of regional food systems highlighted by the 2022 Agricultural Census underscores the success of USDA-supported programs and illustrates the increasing importance of these systems in providing farm viability, strengthening local economies, and meeting consumer demand for fresh, locally sourced food. However, there is still much work to be done to further invest in infrastructure, outreach, and support for underserved producers. To continue building on the momentum of local and regional food systems, ongoing efforts are necessary to ensure that these systems can reach their full potential, creating a more resilient, equitable, and sustainable food system for both farmers and consumers alike.
