Tens of millions of pounds of American-grown produce is rotting in fields as food banks across the country scramble to meet a massive surge in demand, a two-pronged disaster that has deprived farmers of billions of dollars in revenue while millions of newly jobless Americans struggle to feed their families.
While other federal agencies quickly adapted their programs to the coronavirus crisis, the Agriculture Department took more than a month to make its first significant move to buy up surplus fruits and vegetables — despite repeated entreaties.
“It’s frustrating,” said Nikki Fried, commissioner of agriculture in Florida. Fried, who is a Democrat, and much of the Florida congressional delegation asked Agriculture Secretary Sonny Perdue nearly a month ago to use his broad authority and funding to get more Florida farmers plugged into federal food purchasing and distribution programs as the food service market collapsed. “Unfortunately, USDA didn’t move until [last week].”
Tom Vilsack, who served as agriculture secretary during the Obama administration, put it this way: “It’s not a lack of food, it’s that the food is in one place and the demand is somewhere else and they haven’t been able to connect the dots. You’ve got to galvanize people.”
It has been six weeks since President Donald Trump and the Centers for Disease Control and Prevention first urged Americans to avoid restaurants as part of national social distancing guidelines to slow the spread of Covid-19 — a move that immediately severed demand for millions of pounds of food earmarked for professional kitchens across the country.
Just 50 miles from Trump’s home in Mar-a-Lago, Florida growers, much of whose produce was destined for restaurant chains, faced an immediate crisis: Find customers for surplus crops or plow the fields under to avoid attracting pests.
Images of farmers destroying tomatoes, piling up squash, burying onions and dumping milk shocked many Americans who remain fearful of supply shortages. At the same time, people who recently lost their jobs lined up for miles outside some food banks, raising questions about why there has been no coordinated response at the federal level to get the surplus of perishable food to more people in need, even as commodity groups, state leaders and lawmakers repeatedly urged the Agriculture Department to step in.
Demand at food banks has increased an average of 70 percent, according to Feeding America, which represents about 200 major food banks across the country. The group estimates that 40 percent of those being served are new to the system.
In mid-April, USDA unveiled a long-awaited $19 billion aid program with $3 billion set aside to buy excess food, a pot of money that would cover a major ramp-up of fresh produce purchases, along with dairy and meats. But federal officials predicted it would take the better part of a month before that food is packed and shipped to food banks and other nonprofits in need. At that point, it will be too late for many produce growers who saw a huge drop in demand right at the peak of their season.
“By the time that comes through, it won’t help Florida,” said Brittany Lee, a blueberry farmer and executive director of the Florida Blueberry Growers Association. Blueberry prices are about half of what they were this time last year, she said.
The Agriculture Department said it has moved expeditiously to respond to the crisis.
“USDA is committed to maximizing our services and flexibilities to ensure children and others who need food can get it during this coronavirus epidemic,” Secretary Sonny Perdue said in a statement to POLITICO. “This is a challenging time for many Americans, but it is reassuring to see President Trump and our fellow Americans stepping up to the challenges facing us to make sure kids and those facing hunger are fed.”
Department officials declined requests to discuss the government’s approach to capturing the perishable food glut. A spokesperson noted that the department distributes about $2 billion in agricultural products every year to schools, food banks, tribal organizations and others. That number doubled to $4 billion last year as USDA bought up more commodities to help compensate farmers harmed by the trade war.
Nonetheless, the coronavirus catastrophe has laid bare just how tied up in red tape the USDA’s commodity buying system can be. The process typically takes months from start to finish. And the department has historically focused on buying foods that can be stored for long periods — like canned fruit and meats and cheeses — and so is not accustomed to handling an influx of fresh food.
Sudden plunge in demand
In March, about a week after much of the country shut down restaurants, events and other food-service businesses, several produce groups wrote to USDA with an urgent plea to buy perishable commodities because at least $1 billion was “sitting stagnant in the supply chain.”
“There is no reason these high-quality, nutritious, farmer-grown products should be left in facilities to rot when there are so many American families who are suddenly faced with food insecurity,” the groups wrote to Perdue. “These growers and companies are already donating to food banks and others in need and will continue … but they are also facing their own economic crises.”
The department did not make any fresh purchases in response to that request, according to USDA records. Perdue has yet to respond to the letter.
Shutting down restaurants, cruise ships, hotels and schools may have been crucial for stopping the spread of the virus, but it quickly became a train wreck for the food system. The food-service sector represents about half of the food dollars spent and a quarter of food consumed in the country. Some 40 percent of the country’s fresh produce goes into food service, as consumers increasingly prefer to eat vegetables if someone else is preparing them.
The precipitous drop in demand left many growers with no choice but to trash excess food or leave it in the fields because the cost of picking, packing and storing the crops would only put them further in the hole. Some with more resources in hand took on the cost of harvesting and donating the food themselves, but the gut-wrenching reality is that crops are being abandoned on an unprecedented scale.
A handful of states, including Florida and California, set up online clearinghouses to try to match up excess food with need in their area, but the high volumes of surplus produce often can’t be absorbed by local food banks alone, making national distribution important for making even a dent in the waste.
Paul Allen, co-owner of RC Hatton Farms, is currently disking hundreds of acres of cabbage — a process that grinds crops into the soil — because there’s simply no market for it. It’s heartbreaking to watch, but the cabbage he grows is typically used for coleslaw at restaurant chains like KFC. Allen estimates he’s left about 8 million pounds of cabbage and 4.5 million pounds of green beans in the fields.
“We’ve been devastated,” Allen said. His company has already donated hundreds of thousands of pounds of vegetables to food banks. The company also sent containers of produce to the Bahamas and paid for the cost of harvesting to make it all happen.
Now, Allen says, he must decide how many of his crops are better left unpicked, not knowing when much of his customer base will be able to reopen for business. “Do I keep taking on more losses?” he said, noting that vegetable growers have already spent several thousands of dollars per acre before harvest. “But if I stop growing food for our country, that’s a bigger problem yet.”
Growers take aim at USDA
Produce industry leaders, including Allen, are also furious that USDA plans to impose payment limits for the rest of its aid to farmers affected by coronavirus. The department said in mid-April that agricultural producers would be limited to $125,000 per commodity or $250,000 total to help compensate them for damages as it hands out $16 billion in direct payments.
“We begged them not to put a cap on it,” Allen said. Farmers who grow fruits and vegetables have extremely high costs per acre and often plant at such a large scale that the payments won’t even begin to cover their losses. It typically costs less than $700 per acre to grow commodity soybeans. It costs more than $4,000 per acre to grow cabbage. “What is fair is not always equal,” he said.
While $250,000 is a lot of money for most Americans, it represents about one day’s harvest for RC Hatton.
Nearly a third of lawmakers in the House recently asked Perdue to scrap the limits citing “unprecedented damage.”
The scale of produce waste is staggering. Farmers in Florida, which provides much of the fresh produce to the eastern half of the U.S. during the winter and spring, left about 75 percent of the lettuce crop unharvested, along with significant portions of the state’s sweet corn, cabbage and squash. Up to 250 million pounds of tomatoes could end up left in the fields, according to the Florida Department of Agriculture & Consumer Services. Florida officials estimate produce growers there have taken a half a billion dollar hit. In California, the industry is projected to lose more than $1 billion per month.
Tony DiMare, who’s been in the produce business for almost 40 years, said he’s never experienced such a dramatic disruption in demand. “It came to a screeching halt,” he said. It was especially devastating for growers of Florida tomatoes, 80 percent of which are sold into food service.
Toby Basore, a grower based in Western Palm Beach County, Fla., estimates his company disced somewhere between 8 and 10 million pounds of lettuce into the ground in recent weeks due to lack of demand.
“We had a chance of having a really good season before this hit,” said Basore. “You just can’t plan for something like this.”
The dairy industry, for its part, estimates that its supply is currently 10 percent greater than domestic demand, in part because of the closure of thousands of K-12 schools, which are usually significant consumers of milk. The upheaval has strained dairy processors’ ability to turn milk into more storable products like cheese. The International Dairy Foods Association says about 5 percent of the country’s milk is currently being dumped.
Now, the problems in Florida are expected to migrate to other major growing areas that are just beginning their harvest seasons, including California, Georgia and South Carolina.
An attempt to make good
USDA’s new aid package is aimed at cushioning the blow. The department says it will spend about $100 million per month on fresh fruits and vegetables, as well as $100 million each for dairy and cooked meat products every month for the next six months. The products will be sorted into variety boxes — reminiscent of the Trump administration’s widely-panned “Harvest Box” plan, which aimed to transfer a portion of food stamp benefits into a pre-selected box of shelf stable and canned foods.
It’s not yet clear exactly what will go into the boxes. Officials have listed several likely possibilities, including precooked pork and chicken; yogurt, butter and milk; and various produce items, including apples, oranges, tomatoes, blueberries and salad mixes.
USDA officials said that they are trying to get the boxes out the door as quickly as possible. The normal procurement process is complicated enough that it requires a flow chart to outline the steps a business must take to become a supplier.
“We are attempting to move at lightning speed,” David Tuckwiller, director of commodity and procurement at the USDA’s Agricultural Marketing Service, said last week. The department is greatly compressing its typical procurement timeline with the goal of shipping the first food boxes by May 15, officials said.
At that point, it will have been two months since the food service supply chain blew up.
Industry groups praised the new program as a step in the right direction and a down payment on the type of aid they need, but most stakeholders seem to agree it’s not nearly enough.
The United Fresh Produce Association estimates its members are losing out on $1 billion per week.
“We are super frustrated that they’re not being aggressive enough,” said Dennis Nuxoll, a top lobbyist for Western Growers. USDA has the money and the authority to buy several times more than what they’ve outlined, Nuxoll said. “It’s a sound idea, but it doesn’t match the magnitude of need.”
“This thing is a joke,” said DiMare, who listened to the USDA’s recent briefing on the purchase program. He appreciates the department’s intentions, he said, but quickly counts off the program’s deficiencies: It’s not clear how many companies are set up to pack mixed varieties of produce into boxes. What happens to highly specialized growers? If a business only grows tomatoes, will it have to go find other vegetables for the box, or will everyone sell to a third party? Most painfully, the program simply won’t be up and running in time to help Florida, where the season is winding down.
DiMare’s company, DiMare Fresh, has donated over a million pounds of tomatoes to food banks in his area, but he still had to leave some 10 million pounds in the field, he said.
Meanwhile, he said he continues to get calls from food banks elsewhere in the country that need produce, but don’t have the money to cover the costs of harvest, packing and shipping it to where they need it.
Some growers have gotten creative. When Idaho farmer Ryan Cranney suddenly found himself with millions of potatoes he couldn’t sell, he decided to pile them up outside and invite the public to come take what they’d like for free.
“At first I thought we’d have maybe 20 people,” Cranney said in an interview. Thousands of people have now driven to Cranney Farms in Oakley, a town of 700, to take him up on the offer. “About 60,000 people could have about a 10 pound bag a piece … we saw people from as far away as Las Vegas, which is an eight-hour drive from here.”
“If we as a country have more understanding of our food chain and where our food comes from and really what that means to farmers and the distribution system, maybe we’ll be able to change things where we’re not quite as vulnerable going forward,” he said.