Covid-19 Impacts on Food Processing
Our GMM ZOOM this month included an update from County leadership and a multi-speaker presentation from Sonoma County Farm Bureau members regarding the Covid-19 impacts on Food Processing. This presentation gave us insight regarding the pricing increases and availability problems we have faced at our local grocery stores.
Our speaker list included:
- David Rabbitt – Sonoma County Supervisor: Working through phase 2 of our economic recovery. More info…
- Tawny Tesconi – SCFB Exec. Dir.: General overview and introduction of speakers. More info…
- Joe Pozzi – Pozzi Ranch: Raising natural, grass-fed lambs and cattle on pastures and grasslands throughout Sonoma and Marin County. Recently, honored by Whole Foods Market as Supplier of the Year Award for Perishable Products. More info…
- Austin Lely – BeeWell Farms: On the farm they raise cattle and honeybees, and have 3 acres of seasonal vegetable crops, pumpkins and flowers. More info…
- John Bucher – Bucher Farms: Along with their 30+ acre Russian River Valley vineyard, John manages the farm’s organic dairy with 700 milk cows and 700 replacement heifers, calves, and bulls. More Info…
- Loren Poncia– Stemple Creek Ranch: Loren oversees the entire ranching operation, with the goal of raising grass-fed beef that is tender, well-marbled, and tastes just as good as, if not better than, grain finished meat. More info…
David Rabbitt led off, addressing COVID’s impact on the county’s health and economy. Retailers, he began, “have been crushed for the last 77-78 days.” He said that Dr. Sundari Mase, County Health Officer, reports that we’re holding steady at about 40 cases per 100,000 residents. She’s following the stats closely, he said, looking for spikes, hospitalization rates and our ability to ensure care for anyone stricken by COVID. “She’s done a good job,” he said. He added that the Latino community (27% of the population) is a concern, with 71% of the confirmed cases. The good news: 85% of this community is under 50, and 65% have no underlying health condition, so most who fall ill will probably have “better outcomes.”
County leadership is “all on the same page,” he said. Contact tracing is working well. “We can find and isolate people who’ve been exposed so we can slow COVID’s spread. We have testing capacity; supply chain issues have improved.” He expressed disappointment with the tracking app mandate, saying the app should be just “highly recommended” instead. Businesses and individuals, he concluded, should all do morning health assessments, and everyone who feels unwell must absolutely stay home.
Before introducing the farmer/rancher panel, Tawny Tesconi offered perspectives on agriculture in California and Sonoma County. California is No. 1 in US ag production at $54 billion annually. Less well known is that Sonoma’s $756 million annual ag production would rank the county No. 12 in the nation if we were a state.
Ag problems widely reported when COVID struck — like euthanized animals and dumped milk — were tied to the supply chain, e.g., processing, transportation, refrigeration, storage. Farmers, she said, were not at fault.
Tesconi gave examples of how COVID has affected farmers. Farm bankruptcies are up 23%; farmers have lost 50-85% of the food-service market; 60% of California farmers have already lost revenue, a figure that will grow by fall harvest; 42% have lost the off-farm income many need to keep their operations afloat; they’ve seen a 50% price drop in fluid milk, 60% in butter, 22% in beef.
People can help farmers, she said, by buying local, supporting rural broadband access (to support e-commerce) and by working to defeat the split-role measure in November.
Tesconi then introduced the panelists. Among much else, Joe Pozzi said that businesses like his can no longer stand on their own. They need an off-farm job to support the passion for ranching/farming. It’s critical, he said, “to ensure we’re paid fairly for our premium product. We have to find opportunities to move from price taker to price giver.” To compete with less expensive food (which, he implied, is not locally produced), Sonoma County producers “have to show that our products offer added value.” He cited two of his own efforts to do this — certification by the Global Animal Partnership and the “carbon farm plan program.” He called this “connecting with consumers by showing we share their values.”
Pozzi also discussed the meat processing problem. Processors are distant from the county, and they don’t usually handle small lots. “A number of us have talked about the desirability of having a multi-species processing plant in Sonoma County or the Bay Area to handle beef, lamb, pork and chicken,” he said.
Austin Lely said creating year-round income became more challenging when COVID hit. He and his wife sell at farmers’ markets and other outlets, offer CSAs, supply “a few” restaurants, host a pumpkin patch and sell live steers. They too need off-farm income, so he also manages about 20 acres of Cabernet grapes and does farm consulting for a couple of wineries. Navigating COVID and autumn fires, he said, “is tricky. You have to plan a year ahead, and you need at least six months for work in the field. It’s hard to see the future.”
John Bucher also discussed the need to diversify. Beyond his dairy business, he grows grapes and markets composted manure. Dairies, he said, “are the ultimate price takers.” His dairying problem preceded COVID: “The wholesale price of organic milk hovers at or below our break-even point.” Grapes are a problem too, since he and his winery customers depend heavily on DTC (direct-to-consumer) sales, which are down thanks to repeated harvest-time fires, which is when Wine Country gets the heaviest influx of potential DTC visitors.
He also explained why milk had to be dumped. First, he said, 20% of all dairy products are meant for food service. So with COVID’s blow to restaurants and schools, dairy demand plunged. At the same time, cows were producing more than ever, since the pandemic hit during “spring flush” when pastures are greener and days longer, boosting production. Falling demand and rising production coincided with the start of Shelter in Place, which is exactly when the dumping took place.
Rancher Loren Poncia said he’s built his brand “around the environmental stewardship of our property. We produce super-high-quality, grass-fed/grass-finished beef, lamb and pork. We also toy around with honey, compost, education and entertainment — farm-to-table dinners. Our goal is to have people come to our ranch, taste and buy our products.”
“When COVID hit we lost our restaurant business overnight,” he said. However, COVID also “triggered tenfold growth in our online business” since people were now cooking more. Initially, however, processing was a challenge. “Before the pandemic, our beef, lamb and pork processors were cutting the meat into large pieces for restaurants. Suddenly we had to shift. Grocery stores require smaller cuts. Still, retail sales rose and our online business exploded. We’re hoping many of these new customers will stick with us in the future.”
Poncia echoed previously expressed thoughts about processing. “All the processors are within 250 miles of Sonoma County, but in different directions. We work with 12 of them to harvest the animals and create value-added products by cutting and wrapping our beef, lamb and pork. It would be amazing for ranchers to have a local processing facility for our DTC products.”