Support for Supply-Chain Resilience of Locally Sourced Foods

Support for Supply-Chain Resilience of Locally Sourced Foods

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June 23, 2021
Support for Supply-Chain Resilience of Locally Sourced Foods
Over the past decade, food policy in the United States has
aquaponic facilities (e.g., growing fish and plants together
responded to ongoing shifts in consumer preferences and
in an integrated system).
producer trends that favor local food systems (including
Limited data are available on the role of locally sourced
regional and urban food systems). Congress expanded
foods in the U.S. food industry. Available data from
support for a range of programs supporting local food
USDA’s 2017 Census of Agriculture cover direct food sales
systems in omnibus farm legislation, most recently in the
including (1) direct-to-consumer sales (e.g., food sold from
Agriculture Improvement Act of 2018 (2018 farm bill; P.L.
farms directly to consumers at farmers’ markets, roadside
115-334). Congress has provided additional financial
stands, on-farm stores, and CSAs) and (2) direct-to-retail
support for U.S. agricultural producers, including local food
market sales (e.g., food sold from farms directly to retail
systems, as part of pandemic assistance in response to
markets, institutions, and food hubs for locally or regionaly
economic upheaval and agricultural supply chain
branded products). Based on these data, USDA reports the
disruptions related to Coronavirus Disease 2019 (COVID-
farm-level value of these direct food sales totaled $11.8
19). Table 1 summarizes existing USDA program support
billion in 2017 (3% of the total value of U.S. agricultural
and additional supplemental appropriations and other
production), reflecting sales from nearly 159,000 farmers
pandemic-related funding for selected programs across all
(8% of all U.S. farms). More than 90% of farms selling
agricultural products and markets, including local foods.
food products directly to consumers are considered small
farms (i.e., annual sales of less than $50,000).
Currently, more than 30 grant and loan programs
administered by the U.S. Department of Agriculture
COVID-19 Supply Chain Disruptions
(USDA) provide support and assistance for local food
The pandemic caused unprecedented shifts and disruptions
producers and producer groups. These programs may be
in economic activity and supply chains in the U.S. food and
grouped into several broad program categories, including
agricultural sectors, affecting farmers, farm-input suppliers,
marketing and promotion; business assistance and
value-added food processors, marketing and distribution
agricultural research; rural and community development;
channels, and the food system infrastructure. In a June 2021
urban and indoor production; nutrition and education; and
press release, USDA stated that the pandemic “exposed a
farmland conservation. Examples include farmers’ market
food system that was rigid, consolidated, and fragile.”
and local food promotion programs, rural cooperative grant
However, a study by researchers at Colorado State
and loan programs, child nutrition programs, and USDA’s
University indicated that “in some cases local and regional
research and extension activities. Other USDA grant
food systems innovated more quickly to respond to market
programs provide specific support for urban agricultural
demand and policy changes when compared to national
systems and related research. Annually, roughly more than
food systems during the pandemic.” The text box below
$100 million is available in USDA grants and loans to
summarizes the study’s findings, highlighting some of the
support local and urban food systems. For information on
leading factors thought to have contributed to greater
these USDA programs, see CRS Report R46538, Local and
resiliency of the local food system, in some cases.
Urban Food Systems: Selected Farm Bill and Other
Federal Programs.
Local Food Systems During COVID-19
Market for Locally Sourced Foods
A Colorado State University study identified the fol owing
A wide variety of farm businesses are considered to be
factors thought to have contributed to the ability of some local
engaged in producing local foods. These include direct-to-
food systems to innovate and respond during COVID-19:
consumer marketing, farmers ’ markets, community-

Local food markets often have shorter supply chains that
supported agriculture (CSA), community/school gardens,
al ow for greater flexibility and quicker response times, as
and food hubs (referring to a centralized facility that
wel as the ability to communicate directly with the local
supports the aggregation, storage, processing, distribution,
food customer base and adapt quickly to changing needs.
and marketing of locally produced foods). Other types of

Many local producers moved online to better serve
operations include on-farm sales/stores, internet sales, food
consumers during the pandemic (e.g., using an order-and-
deliver model similar to national grocery chains), al owing
cooperatives and buying clubs, roadside stands, “pick-your-
own” operations, urban farms, community kitchens, small-
local food markets to streamline the purchase process,
which often resulted in larger orders from local buyers.
scale food processing, and agritourism activities. Urban

farming operations also include a diverse range of systems

Regulatory agencies relaxed policies in response to the
pandemic, al owing for new flexibilities by moving some
and practices, including large-scale innovative systems and
USDA program benefits online and al owing products that
capital-intensive operations, vertical and rooftop farms,
original y had been marked for wholesale (e.g., larger
hydroponic greenhouses (e.g., soilless systems), and
product boxes) to be sold directly to consumers.
https://crsreports.congress.gov

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Source: Adapted from D. Thilmany et al., “Local Food Supply
Chain Dynamics and Resilience during COVID-19,” Applied
Economic Perspectives and Policy, vol. 43, issue 1, October 2020.

Table 1. Selected Farm Bill Authorizations and COVID-19 Pandemic Assistance
Mandatory
Discretionary
Selected Programs: Agriculture Improvement Act of 2018
F
u
n
d
ing
Authorizations
Notes
(2018 farm bill; P.L. 115-334 )
($millions, FY2022)

Local Agriculture Market Program (LAMP)
50.00a
SSAN
P.L. 115-334, §10102
Specialty Crop Block Grant Program (SCBGP)
11.75
—

Local Agriculture Market Program (LAMP)
11.75
—

Value Added Producer Grants (VAPG)
17.50
—

Regional Food System Partnerships (RFSP)
5.00
—

Specialty Crop Block Grant Program (SCBGP)
85.00b
—
P.L. 115-334, §10101
Farming Opportunities Training and Outreach (FOTO)
40.00a
50.00
P.L. 115-334, §12301
Section 2501 Program
20.00
25.00

Beginning Farmer and Rancher Development Program
20.00
25.00

The Emergency Food Assistance Program (TEFAP) Farm
4.00
—
P.L. 115-334, §4018(b)
to Food Bank Projects
Selected Supplemental COVID-19 Assistance
Appropriations ($millions, years vary)
Notes

Coronavirus Aid, Relief, and Economic Security Act (CARES Act; P.L. 116-136)
Office of the USDA Secretaryc
9,500.00 (TRAUE)
Division B, Title I
Agricultural Marketing Service, Marketing Services
45.00 (available until Sept. 30, 2021)
Division B, Title I

Consolidated Appropriations Act, 2021 (P.L. 116-260)
Office of the USDA Secretaryd
11,187.50 (TRAUE) Division N, Title VII, §751
Specialty Crop Block Grant Program (SCBGP)
100.00 (TRAUE) Division N, Title VII, §752
Local Agriculture Market Program (LAMP)
100.00 (TRAUE) Division N, Title VII, §753
Farming Opportunities Training and Outreach (FOTO)
75.00 (TRAUE) Division N, Title VII, §754
Emergency Food Assistance Program
400.00 (available until Sept. 30, 2021) Division N, Title VII, §711

American Rescue Plan Act of 2021 (ARPA; P.L. 117-2)
Food Supply Chain and Agriculture Pandemic Responsee
4,000.00 (TRAUE)
Title I, Subtitle A, §1001
Farm Loan Assistance for SDFRs
SSAN (TRAUE)
Title I, Subtitle A, §1005
Assistance and Support for SDFRs, Forestland Owners, etc.
1,010.00 (TRAUE)
Title I, Subtitle A, §1006
Source: CRS from the 2018 farm bil (P.L. 115-334), ARPA (P.L. 117-2), FY2021 Appropriations (P.L. 116-260), and the CARES Act (P.L. 116-136). Excludes
certain pandemic assistance, including most nutrition and domestic food program assistance, assistance for specific commodities (including use of Commodity
Credit Corporation funds), research and rural business assistance, and USDA administration and oversight funds.
Notes: TRAUE=To Remain Available Until Expended; SSAN=Such Sums As Necessary; SDFRs=Social y Disadvantaged Farmers or Ranchers.
a.
LAMP and FOTO al ocations across subprograms are based on formulas specified in the 2018 farm bil (excl uding administrative expenses).
b.
SCBGP does not explicitly support local y produced foods. However, previous state-level program awards often have supported local food systems (such as
local food production/processing and agritourism), and some state programs have supported local y branded products.
c.
This funding covered al U.S. agricultural products and markets while targeting an unspecified amount for “producers that supply local food systems, including
farmers markets,” among other groups. See CRS Report R46347, COVID-19, U.S. Agriculture, and USDA’s Coronavirus Food Assistance Program (CFAP) .
d.
This funding covered al U.S. agricultural products and markets while targeting an unspecified amount for “producers and growers of specialty crops, non -
specialty crops, dairy, livestock, and poultry, and producers that supply local food systems, including farmers markets,” among others.
e.
This funding targeted al types of USDA purchases of food and agricultural commodities to “individuals in need” while targeting “grants and loans for smal or
midsized food processors or distributors, seafood processing facilities and processing vessels, farmers markets, producers” a nd other assistance. For more
background, see CRS Report R46432, Food Banks and Other Emergency Feeding Organizations: Federal Aid and the Response to COVID -19.
Considerations for Congress
initiative is expected to use $4 billion in enacted pandemic-
Supplemental pandemic-related assistance shown in Table
related assistance to examine food production, processing,
1 covers all U.S. agricultural products and markets and does
distribution, and consumer markets. USDA’s stated
not exclusively support local food systems. However,
priorities related to food distribution and aggregation will
legislative language regarding this supplemental assistance
support investments in food system infrastructure to
often specifically highlighted the need to support local food
improve resiliency, flexibility, and responsiveness
systems (see Table 1 notes). USDA’s ongoing efforts to
(including an unspecified portion for local food systems).
address pandemic-related disruptions in the U.S. food and
USDA’s initiative also seeks to expand access to markets
agricultural sectors similarly include local food systems
for a diversity of growers (including socially disadvantaged,
among other products and markets. In April 2021, USDA
and small and mid-sized producers) and consumer access to
announced it was evaluating ways to strengthen food and
healthy foods. Congress is likely to continue to oversee
agricultural supply chains (86 Federal Register 75), stating
these and other pandemic-related initiatives at USDA.
it was “particularly interested in comments addressing local
Congress also could consider other policy options to
and regional food systems .” USDA’s Build Back Better
strengthen supply chains in the food and agriculture sectors.
https://crsreports.congress.gov

Support for Supply-Chain Resilience of Local y Sourced Foods
This could involve changes to existing USDA programs or
Renée Johnson, Specialist in Agricultural Policy
proposals for new programs , including a review of federal
procurement authorities related to USDA food purchases to
IF11863
grant preference for locally sourced foods and products.

Disclaimer
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