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by Morgan Gramlich and Dr. Renee Threlfall - December 20, 2019
Check out this guest post from Horticulture graduate student Morgan Gramlich as she
shares results from a study she performed this past year with value-added products
from farmer's markets!
My name is Morgan, and I am a graduate student in the Department of Horticulture at
the University of Arkansas, Fayetteville. The purpose of this study was to determine
if it is economically feasible to develop value-added products from farmers market
surplus. Our goal was to use value added product development as a way to reduce food
waste while increasing revenue for produce vendors. The data collected was used to
determine if it was possible to develop products from the surplus produce at a small
farmers market in Arkansas and to assess economic feasibility of these product development
efforts. The farmers market studied was The Original Rogers Farmers Market located
in Rogers, Arkansas.
The Original Rogers Farmers Market had about 20 vendors from Arkansas and Oklahoma,
and 4-8 of these vendors sold produce in any given week. Produce was collected on
market days (Wednesdays and Saturdays) for fourteen weeks (Jun 1-Sept 5) during the
2018 market season. At the end of every market, surplus produce was collected from
vendors. Produce that could be prepped for long term (4-8 months) freezer storage
(e.g., tomato, onion, peppers, etc.) was targeted rather than produce that was not
suitable for processing and storage (e.g., lettuce, kale, leafy greens, etc.).
Picture 2. Pre-processed produce ready for flash freezing at The Arkansas Food Innovation
Picture 3. Flash frozen produce at The Arkansas Food Innovation Center (2018)
A walk-in refrigerator (2°C) was used to store surplus produce received, and a walk-in
freezer (-10°C) was used to store pre-processed surplus. The recipe and product development
for the surplus produce were completed at AFIC using typical kitchen-type equipment
(blenders, food processors, and stove). The equipment used for large-scale product
processing included an Electrolux Air-o-chill Flash Freezer (Model AOFP101CU), ULTRAVAC
Vacuum Sealer (Model ULTRAVAC 500), Hobart Food Preparation Machine (Model FP400),
an Urschel Comitrol Processor, 150 gallon (568 liters) stainless steel steam kettle
(model N1991), and an Airtac Piston Filling Machine (Model SGF500-J). The produce
was filled into 16 oz (473 mL) economy clear glass jars with 70-450 mm continuous
thread gold-buff button top lids.
We spent $2,460 to purchase 924 kg (2,036 lbs) of surplus produce from The Original
Rogers Farmers Market during the 2018 market season. About 19% of the collected produce
was donated, and 11% of the donated produce was used for the value-added production
of tomato sauce.
At the end of the farmers market season, the total amount of pre-processed and frozen
produce was evaluated for a potential recipe based on what types of produce had been
collected and the quantities. A recipe for tomato sauce was developed, although other
possible products could have been a squash/zucchini flour or herb packets. The tomato
sauce was the primary product developed for this project.
Recipe testing and development was initiated using the weights of each frozen produce
item. The initial recipes were evaluated in small batches (9 kg or 20 lbs). Table
1 shows the final recipe used for sauce production that included tomatoes, cherry
tomatoes, bell peppers, onions, green onions, eggplant, corn, carrots, jalapenos,
and hot peppers with the addition of white vinegar, salt, sugar, and basil. The recipe
was developed with the goal to have a flavorful, self-stable, and food-safe sauce.
One of the key food safety goals was to have a final pH (acidity) of about 4.0 or
Table 1. Recipe for tomato sauce produced at the Arkansas Food Innovation Center,
Fayetteville from farmers market surplus produce (2018).
Tomato sauce production occurred after the recipe was finalized. The day before processing,
the produce for production was removed from the freezer and weighed in the appropriate
ratios according to the recipe. The produce was thawed at room temperature (21°C)
for 24 hours.
The following day, the produce was chopped using the Hobart Food Preparation Machine.
The chopped produce was collected in food grade buckets and then poured into the Urschel
Comitrol Processor to reduce the produce to the consistency of a puree.
After cooking, the base of the kettle was connected to the Airtac Piston Filling Machine
to hot fill two 16 oz jars, simultaneously. Once filled, the jars were sealed with
lids by hand, inverted for two minutes to sterilize the inside of the lids, and then
placed upright on a table to cool. After 24 hours, the jars were packaged into boxes.
Within a month, the labels were applied to the jars. The final product was evaluated
for pH, soluble solids (sugar level), and consistency. The sauce was submitted and
received Process Authority Certification.
The economic feasibility of creating value added products from farmer’s market surplus
was evaluated by analyzing the product development costs and potential revenues documented
during the project. Table 2 shows a realistic cost analysis for implementing this
project at a farmer’s market. The project could be implemented at a farmer’s market
by the market manager, an individual hired by the farmers market, a group of vendors
from the market, or an outside organization. Implementing this project at a farmer’s
market may not be economically profitable using these estimates of cost, but is logistically
Sales. About 600 16 oz jars of tomato sauce were produced from surplus produce collected
at the farmer’s market. The anticipated market value of the sauce was $3,600 ($6.00/jar).
Cost of Goods Sold. The jars and lids represent the wholesale price of purchasing 600 jars and lids.
The freezer storage bags represent the wholesale price of purchasing storage bags
for the produce (over half still remain). The ingredients represent the cost of purchasing
additional ingredients (vinegar, salt, sugar, and dried basil) for production of the
sauce. Fresh produce costs are entered as zero because product development uses produce
that would otherwise be discarded. The labels are the price of purchasing product
labels for the jars at $0.50 a label for 600 jars.
Other expenses. The insurance is the cost of food liability insurance that must be purchased yearly
for clients of AFIC. The facility rental was calculated based on the hourly cost associated
with the use of AFIC. The rental cost for the hours needed to implement this project
included $840 for collection and pre-processing produce (2 hours at the end of every
farmers market × 2 times a week × 14 weeks × $15.00/hour), $30 for preparation prior
to production (2 hours × $15.00/hour), and $120 for day of production (8 hours × $15.00/hour).
Labor cost was also calculated as $777 for one person spending 30-45 minutes collecting
the produce at the end of the farmers market, driving to AFIC and pre-processing the
produce (3 hours at the end of the market × 2 times a week × 14 weeks × $9.25/hour),
$18.50 the day prior to production (2 hours × $9.25/hour), and $222 the day of production
(3 people × 8 hours × $9.25/hour). The freezer storage was calculated based on the
cost of storage for one pallet of product stored in the AFIC freezer at $20.00/month
for four months (market season).
Startup Costs. The label design could be a cost consideration if a person is hired to professionally
design a produce jar label and would cost $100.00- $300.00, but an individual could
also design a label using computer software on a home computer. The nutritional facts
panel represents the cost to develop a nutritional facts panel (one-time cost) that
is required for the label. The process authority certification is the price associated
to get the product certified with the Food and Drug Administration (one-time cost)
for a product of this type. The Arkansas Department of Health permit is required
for the production of a commercial food produce and has an initial cost of $85.00
and $35.00 every year after.
Projected Net Income. Under this model for the use of surplus produce from a farmer
market to create a value-added product there would be an anticipated projected profit
of $132.57 in the first year $362.57 in the second year.
There are potential ways to improve cost and logistic feasibility of the use of farmers
market surplus to create commercial food products. Some suggestions include:
One of the key factors for success would be to engage a farmer’s market (manager and
vendors) willing to implement unique methods to reduce overall produce surplus/waste
to provide a locally made product from local ingredients. Overall, there are many
ways this project could be made economically feasible to generate additional income
for farmers market vendors or for farmers markets. Our project was able to demonstrate
that surplus produce captured at a farmer’s market can be turned into a value-added
product that would save this produce from otherwise going to waste.
This project was funded by a Specialty Crop Block Grant from the Arkansas Agriculture
Department, USDA (AM170100XXXXG030).