Increasing Local Food Purchasing through Forward Contracting
April 22, 2016 - Author: Abby Harper, Erin Caudell
By working with farmers to coordinate plantings and deliveries in advance, schools and early childhood programs can have a more dependable supply of local foods for their meal programs. This webinar discusses the different ways schools can use a forward contract when purchasing local foods, how to get started, and the benefits for both farmers and K-12 schools and early childhood programs.
This webinar is given by:
- Abby Harper, CRFS Farm to School Specialist
- Erin Caudell, MSU Department of Horticulture
Abby Harper: So hi everybody. Welcome to today's webinar on forward contracting. This is the third webinar in our mi farm to school spring webinar series. You can find recordings of the other webinars at mifarmtoschool.msu.edu. That is right there on the bottom right-hand side of the screen. And they're, the earlier ones we did were on local procurement regulations and garden to cafeteria. So be sure to check those ones out. On the line with me is Erin Caudell. She wears many hats. One of which is working as the Hoop House Specialist in the Department of Horticulture here at MSU. As well as a farmer and local grocer in Flint, Michigan. And she is joining me today to talk about forward contracting. My name is Abby Harper. I'm the Farm to School Specialist here at the Center For Regional Food Systems. And a couple of logistics before we get started. There is a chat box that should appear on the right side of your screen, where you can ask questions throughout the webinar. We'll be answering them at the end. But I know that I tend to forget questions if I don't write them down. So please feel free to type them in as they come up, and we'll revisit them at the end. And, as I mentioned, this webinar is being recorded and will be available on the website for future reference.
So just to go over our goals for the webinar today. We recognize that forward contracting is a new area for many of you. So we're aiming to make this webinar really a basic overview of what it is. And some preliminary steps that you can take to work towards creating forward contracts in your programs and with your partners. We'll spend a bit of time introducing the concept and discussing the benefits and opportunities, both for schools and early childhood programs as well as for farmers. And then we'll spend the bulk of the webinar discussing some preliminary steps for setting up forward contracts. And end with a couple of examples that Erin and I have seen from our work in Michigan. Part of the reason that we're doing this webinar now is that I personally haven't seen a lot of examples of this in my work in Michigan. That's not to be said that it's not being done. But I think that for many it's still a new arena. So the examples that we're going to share at the end are fairly small in scale. And are really good examples of great starting points for transitioning towards this kind of work.
Those of you who are tapped into the USDA farm to school network, they've recently done some webinars on forward contracting as well that gives some examples of some programs that are a little bit more advanced in their forward contracts. And are doing much larger scale forward contracts. So, if you need some inspiration for what it could look like down the road, definitely check those out. So "forward contracting" is a term for any contract established in advance of when the product is delivered. In reality, many contracts that you create for food service purchasing are likely well in advance of when they'll be delivered. But what really differentiates a forward contract in relation to farm to school is that it's generally established before a crop is even put in the ground. Forward contracting with farm to school means that you're working with a farmer, a processor or a distributor to secure a product ahead of time. It allows farmers to adapt their harvest and planting schedules to meet buyers' needs well in advance. And I also want to emphasize that, if you're working with a distributor or food service management company or other third party. There are a lot of opportunities for creating forward contracts there as well. They just might look slightly different. And we'll discuss that a bit over the course of the webinar. But you can definitely work with food service management companies or your distributors to help them establish forward contracts with farmers so that you can get your reliable supply of local food. And so really the main thing that differentiates forward contracting from other types of purchasing is the timeline. So there are programs that establish forward contracts on a quarterly basis. Some that do them the previous year. But it's really just setting up that purchasing strategy well in advance of when you're expecting delivery of the product. And I'd like to do a little poll. So there will be a poll coming up on your screen. And it's really just an attempt to get a better idea of where you all are in regards to forward contracting. So, if you guys wouldn't mind answering that poll that comes up on your screen. Got a few more who need to vote. All right. So it seems like most of you are pretty brand new to forward contracting. Oh, with the exception of one who has done a forward contract. So that's great. So good to know where we're all at. And we'll keep that in mind as we continue our webinar.
So to give you a couple examples of what forward contracting can look like, these are some that I've seen both in Michigan and elsewhere. One way you could use a forward contract is to secure product ahead of time for a featured event. Such as if you're featuring Harvest of the Month or Cultivate Michigan Featured Foods. For those of you who haven't heard of Cultivate Michigan, that is a local food purchasing campaign out of our Michigan Farm to Institution network. You can learn more about them at cultivatemichigan.org. But essentially they choose four products a year to feature that are Michigan products. And they develop some purchasing guides to support the purchase and use of those products in institutional food service. And we do, I know of some examples throughout the state where folks are creating events that highlight those featured foods. So a forward contract could look something like planning a year ahead of time to work with the farmer to have ample quantity of those products for those featured events. So, whereas a farmer may not typically plant those quantities, if they know ahead of time that they have an outlet for them, you can work with them to make sure you get the quantity you need. Another way a forward contract could look is by setting up consistent deliveries of one or two products on a regular basis.
Read the full Forward Contracting Webinar Transcript