Minnesotans Cash In On “Truck Farming”

Minnesotans Cash In On “Truck Farming”

Increased demand for locally grown produce is feeding a budding industry of growers attempting to nurture hobbies or family traditions into a viable revenue stream.

EVERY FRIDAY AND SATURDAY NIGHT as the sun begins to set, Shur Yang and his family head to their 40-acre farm near Hammond, Wisconsin, to hand-pick a variety of fresh greens and vegetables. Yang, his four siblings, and their parents work through the night loading trucks that, as soon as the sun rises, transport their crops 50 miles west to three vegetable stands at the Minneapolis Farmers Market.

“We struggle with getting to the market early,” Yang says. “My parents believe picking fresh is better; they don’t like the idea of a cooler. My dad says, ‘As soon as you think cooler, you become lazy.’ ” Lack of refrigeration requires vegetables be picked fresh so they arrive at market looking better than the competitions’ every summer weekend morning.

Yang, 27, is a third-generation Hmong vegetable farmer and a business student at Metropolitan State University in Minneapolis. His maternal grandparents emigrated from Laos to Minnesota in the early 1980s and started farming with the help of a University of Minnesota extension program. His grandfather, Sing Pao Lor, leased farmland off Highway 61 near Hastings. When Lor’s daughter Xa married Kao Yang, cultural norms dictated Lor’s new son-in-law help his wife’s parents with the farm. Already a full-time welder, Kao Yang worked weekends and evenings during the growing season for his in-laws. By the mid-1990s, he had saved enough money to buy his own 40-acre plot near Hammond.

Today, Kao and Xa Yang are able to pay cash to put their five children through college by working their full-time jobs (he continues to weld; she works as an early childhood development teacher) and operating their farm on weekends. “My dad likes to pay everything forward. He doesn’t like to take out loans,” says Shur Yang. “The farm is like a fundraiser for us kids to go to college.”

 

Trend Turned Industry
The Yangs are among hundreds of Minnesota families who are now toiling to cash in on the budding industry of “truck farming”—growing fresh fruits and vegetables and quickly trucking them to local buyers. Here and elsewhere in the country, consumers increasingly want fresh, locally grown foods either for home consumption or while dining out.

Truck farming was an extensive business in the Twin Cities area before World War II, when local growers supplied local grocers. With the rise and then dominance of supermarkets, along with the expansion of suburban development into farmland, truck farming all but disappeared in the next quarter-century.

The 1970s saw a fresh interest in locally grown produce; natural-foods co-ops and farmers markets sprang up across the Twin Cities. Meanwhile, tens of thousands of families across the United States fled urban life to live on their own mini-farms, also called hobby farms, usually within 30 to 50 miles of a major city.

In more recent years, the sustainability and organic foods movements, and efforts by employers and the federal government to help Americans better understand nutrition have propelled U.S. consumer desire for fresh and local foods. There’s even a new word for this increasing segment of American consumerism: “locavores”—people whose diet consists of food grown or produced within an area most commonly bound by a 100-mile radius of their home.

This demand has led to a quadrupling of Minnesota farmers markets during the last 10 years to 148 today. It’s fed a spike in the number of restaurant offerings made from locally grown ingredients (the top menu trend in 2012 is locally sourced foods, according to the National Restaurant Association). It’s moved grocery stores ranging from St. Cloud–based Coborn’s to Hopkins-based Cub to market more locally produced foods. And it’s attracting a growing number of Minnesotans looking to make money by serving such markets.

In 2007, the most recent years figures are available, there were 4,293 growers in Minnesota selling directly to consumers, a 37 percent increase since 1997, according to the U.S. Census on Agriculture. Annual sales during that same 10-year period rose 144 percent to $34.7 million, and average annual sales for these types of farms nearly doubled, to $8,075.

 

Types of Growers
Growers serving the state’s 148 farmers markets—as well as local restaurants and other customers with such interests—typically fall into three categories: recent immigrants, legacy farms, and back-to-the land or hippie growers, according to David Nicholson, principal at North Node Consulting in Minneapolis. Nicholson was instrumental in restarting the Kingfield market and starting the Fulton market (both in Minneapolis). He also is working to increase access to healthy food for low-income consumers.

Most work at their craft only part time, but when the last of a season’s crops are marketed, they keep busy. “After October, they have a good month of working in their fields to prepare for the next year. For those who have greenhouses, they need to re-cover them with plastic every two to four years,” says Larry Cermak, manager of the Minneapolis Farmers Market. “They then take it relatively easy during the month of December, but in January they start looking forward to getting seed orders in. Most have greenhouses, or work with a greenhouse, to start vegetables growing around February 15.”

About half of the vendors that serve the Minneapolis Farmers Market fall into the “recent immigrant” category, which primarily comprises Hmong families, Cermak says. Across the river at the St. Paul Farmers’ Market in Lowertown, the numbers are similar. The Hmong, who came from rural backgrounds in Southeast Asia, made an easy transition to truck farming in the United States.
 

Many of these farmers work with one person, Chang Vang, to have their seedlings grown under greenhouse protection during Minnesota’s winter months. Vang owns five acres in Hastings. On about one-quarter acre, he operates six greenhouses in which he germinates seedlings during February, March, and April for approximately 100 area families. He says about 80 of his customers are of the truck farming variety, while the other 20 raise crops just for themselves and perhaps a small group of friends or relatives. About two acres of his land are for his own garden, he says, and “the rest is just my backyard.”

Vang came to Minnesota from Laos in 1991 with a family of four children. He earned a high school diploma and then went to vocational technical college for two years to learn a trade. “I graduated in 1997 and went to work in auto body shops until I quit in 2006 and became self-employed.” He did so by purchasing the property in Hastings and training himself to pick the best vegetable seeds for planting, and to learn exactly when to plant them so that they would produce seedlings ready for customers to transplant in April and May.

Legacy growers typically have larger farms and have been in business for decades. They tend to specialize in some way, typically have taken over their parents’ land, and have at least one family member who works full time on the farm.

One well-known legacy grower is Jerry Untiedt, who has several hundred acres in Wright County, about 45 minutes west of Minneapolis. More than half of his acres are devoted to vegetables; he also grows field corn, soybeans, and wheat. The farm supports him and his wife, as well as his two married daughters and their families. His two daughters’ husbands also work on the farm full time. And unlike many legacy growers, Untiedt is a first-generation farmer.

“When we bought our first farm in 1971, we bought 50 acres and we started with sweet corn and pumpkins,” he says. “We started selling at the Minneapolis market shortly thereafter. The learning curve has been fairly steep and long.”

Besides a fresh-vegetable stand, Untiedt runs a large concession stand at the Minneapolis market, mainly known for its roasted corn on the cob. “It has morphed into a larger enterprise,” says Untiedt. “We started to do bratwurst, and then people wanted something to drink. I didn’t want to sell pop, so we started selling fresh-squeezed lemonade and orange juice, and then people wanted caramel rolls to go with their orange juice, and then coffee.” He grows the corn and the garnish of garlic, onion, and peppers he serves on the brats and sells fresh to consumers. “In our case, it probably wouldn’t work without having both the [vegetable] stand and the concessions,” he says. “They are so intertwined.” He also furnishes all of the sweet corn to the roasted corn stand at the Minnesota State Fair.

Another legacy grower is Bonnie Dehn, co-owner of Dehn’s Gardens in Andover. Dehn, the current president of the Central Minnesota Vegetable Growers Association, has been working at the Minneapolis Farmers Market since she was about five; her parents, grandfather, and great-grandfather all sold at the market. Dehn and her husband, Bob, bought their first 10 acres from her parents in 1978. At the time, her husband had stage-four Hodgkin’s lymphoma, and Dehn needed to do something that could sustain the family through his illness.

“I and the girls, who were very young at the time, could farm and make a market garden something that could work for us,” says Dehn. When her husband recovered, they expanded. “We bought land as we could afford it,” she says. Today, the Dehns specialize in herbs and small vegetables on 105 acres of land. “We are really known for our carrots,” she says. “They are the best, most flavorful carrots in Minnesota.” When most market-goers think of Dehn’s, however, they think herbs.

Dehn estimates that her family’s farm grosses $125,000 per year. The farm grows more than 300 varieties of herbs and vegetables and in addition to open fields has 18 high-hoop greenhouses, costing between $6,000 and $75,000 each, which extend the growing season. The farm supports her and her husband and provides the sole source of income to the families of their two daughters, who also work on the farm.

The Dehns have a tractor, pot filler, and dirt cooker to rid the soil of bacteria, and several golf carts so that they can travel quickly from field to field, but the operation involves mostly handwork. “We go through 100 pairs of scissors in a season because we harvest so many herbs,” says Dehn. “Our accountant says [we] aren’t paid enough for the hours [we] put in.” The Dehns’ sole marketing channel is the Minneapolis market.

The third type of grower, which Nicholson refers to as “back-to-the-land” or “hippie,” comprises newer, mostly younger farmers who’ve latched on the locavore boom. They’ve also been encouraged by the loosening of restrictions on urban farms and market gardens that the Minneapolis City Council approved in March.

Eric Larsen, manager of finance and administration for Stone’s Throw Urban Farm, could be considered a “back-to-the-land” grower, but with an urban twist. Larsen, 26, and his five partners farm 15 vacant lots in the Uptown and Phillips neighborhoods in Minneapolis and in the Frogtown neighborhood in St. Paul. Two of his partners are under age 24 and others are 30-somethings. “We’ve been individually farming in the Twin Cities for the past three years with different farms that came together to form a single farm last fall,” he says.

The three farms that merged were Uptown Farms, Pig’s Eye Urban Farm, and Concrete Beach Farmers. Each was selling at a different market; this year, the newly formed team will sell only to two: Mill City Farmers Market and Midtown Farmers Market, both in Minneapolis.

“We all live in the community we farm in,” says Larsen. “The lots that we farm are generally leased from individuals or organizations. The lot is sitting empty, and we approach the owner. In exchange, the owners don’t have to worry about maintaining the lot. Some lots we pay rent for, and others we use for free.”

Stone’s Throw Urban Farm grows salad-mix greens, carrots, beets, and heirloom and cherry tomatoes for the markets. “Previous to the merger, we weren’t making a significant wage,” says Larsen. “We were just covering expenses and having a little pocket change left over.”
 

Larsen and his partners plan to pay themselves $10 per hour beginning this season. For some of the partners, it will be their only job. Others have off-farm jobs and will work 20 to 30 hours per week during the season, rotating shifts through the markets.

Last year, the three farms together grossed $50,000. This year, Larsen projects revenue of $80,000 to $100,000. He estimates that the markets generate 25 to 35 percent of the group’s revenue. Another 5 percent comes from wholesale accounts, and the rest of their revenue comes from selling shares in community supported agriculture (CSA).

 

Growers’ Markets
Growers that provide fresh, local food can sell retail at the metro area’s markets; wholesale to restaurants, grocery stores, and food distributors; or through shares in their produce through CSA programs. A CSA share is typically split among one household, and one share usually sells for $575. Shareholders receive fresh produce weekly during the season, and the grower receives an advance payment that helps pay for seed and pre-season expenses.

“Farmers love CSAs. They get the money up front,” says Glen Hill, executive director of the Minnesota Food Association, a nonprofit based in Marine on St. Croix that provides training to recent immigrant farmers. “But they need to be able to grow eight to 12 different crops and have them ripe and ready each week for 18 weeks, which is very difficult to do. They also have to have computer skills; they need to use a spreadsheet to keep track of everything they have.”

Many growers also sell wholesale, or direct to restaurants and local grocery stores. “To sell wholesale, you need to produce large volumes, and you get eight to 10 large checks in return between August, September, and October, so you need to be able to manage cash flow,” says Hill.

Lori Valenziano, the food buyer for Lucia’s, an Uptown restaurant that has served fresh, local fare for nearly three decades, buys primarily direct from local growers and from distributors like Coop Partners, which buys direct from farmers. “For the past couple of years, I’ve gone to the Fulton Farmers Market on a regular basis, not to buy necessarily, but to ask the growers what they had that I could get the next day.” Valenziano says. “I like to use the farmers markets as a way to find farmers who want to sell to us, so I can buy more later on.”

At the end of the day during market season, Lenny Russo, owner and chef at Heartland Restaurant and Farm Direct Market, says he will either invite growers from the St. Paul market in Lowertown to his restaurant across the street, or he’ll walk over to see what the growers want for their leftover produce.

“We can’t buy retail,” says Russo. “We need a wholesale price.” While wholesale prices are about half of what retail can bring, growers can still benefit because they don’t have to haul their produce back to the farm or try to sell it elsewhere if they don’t have coolers. “And we get it at a price that works for us,” says Russo.

Russo’s indoor, year-round Heartland Farm Direct Market sells fresh produce, eggs, dairy, and locally raised meat, fish, and poultry. “The customers of the market want number-one quality tomatoes, no blemishes,” says Russo. “We don’t care about that [at the restaurant] because we are going to process them. So I’ll buy number-2 heirloom tomatoes for $1 to $1.50 per pound.” By contrast, perfect tomatoes can cost upward of $3 per pound.

 

Can They Make Money?
As noted, sales are surging here for truck farmers, nearly doubling per average farmer from 10 years ago. But making a profit can be a challenge.

Most experts agree that the more acres growers farm, the more markets they can serve and the greater the chances are they will succeed. Growers who own their own land are considered land-secure unless, of course, the land is highly leveraged. Those who have five-year leases are also considered secure, but most leases are renewed annually.

“The biggest obstacle for us has been access to land,” says Larsen of Stone’s Throw. “There is not a big consciousness in the public to have vacant land be used for farming.” While his group hopes to begin paying themselves an hourly wage this season, others are skeptical that the operation’s size will generate high enough returns after costs.

Most of the hippie-type growers remain in business for only three to five years, according to Nicholson. “Often if they buy land, they can’t make enough to pay for it, so they go under in the long run,” he says. Without land, their situation is even more precarious. Growers working part time also typically do not make the leap to farming full time because of the time commitment involved, high cost of buying land, and low returns.

At a farmers market, Hill says vegetable growers typically make between $300 and $1,000 a week. Some markets including those in Minneapolis, St. Paul, Edina, and White Bear Lake, are more lucrative than others. At these coveted markets growers can make $500 a day or more, but the markets have long waiting lists for open spots. For Dehn, $500 a day is break-even. Other markets have less foot traffic and some cater to low-income consumers. “In these markets, you might only make $50 a day,” says Hill.
 

Mhonpaj Lee, 27, a graduate of Hill’s program, runs Mhonpaj’s Garden. Her parents emigrated from Laos in 1981 and began farming part time. Today, the family grows vegetables on seven leased acres of land. Lee runs the business part-time. As the first certified-organic Hmong grower in the state, Mhonpaj’s Garden is making full use of a varied market portfolio. The business sells at the St. Paul Lowertown and White Bear markets as well as direct to local grocery stores and offers shares in a CSA. Still, Lee says vegetable farming will never provide a full-time living for anyone in her family.

Rob King, professor in the Department of Applied Economics at the University of Minnesota, coauthored a report that compared the performance of local and conventional farmers. “One issue we saw when farmers sell to farmers markets, especially for some, is that oftentimes they have significant costs, up to 35 percent of income, in stall fees, labor at the market, and transportation to and from the market,” says King. “They do a lot more work selling at the market than selling wholesale.”

Both the Untiedt and Dehn family operations are large enough to be economically sustainable moving forward, but land values are threatening these operations. Farmland nearby Dehn’s operation recently received an offer of more than $40,000 per acre from a developer, and Delano land values are not far behind. “For legacy farms there will be a great incentive to sell the land and cash out, because you can’t make enough money and you can’t shelter yourself from risk,” says Nicholson.

Risk is a factor all of the growers face. Nao Tou Yang, a successful second-generation Hmong grower, owns a 50-acre farm near Rosemount, where he grows mostly garlic. He came to the United States at age 13 and works full time for Metro Transit. Last year, he says, he lost most of his crop to bad weather, and his children are not all that interested in farming.

“You can’t make a full-time living because of the weather,” says Tou Yang. “You only have two to three months. If you have a greenhouse or high tunnels [high-hoop houses], maybe you can. If you have lots of acres and a specialty crop, maybe you can, but on three to five acres in the summer months, it is impossible.”

Competition is also increasing as the number of markets skyrockets. “A lot of families are doing it now. When my parents started, there were only a few families farming,” says Tou Yang. “There are too many markets and too much competition. I’m about to quit.” The number of markets has forced some growers to lower their prices.

“The last three years, we’ve seen amazing growth in the number of farmers markets. There are a lot of contributing factors. Communities are looking to build community or bring traffic to their downtowns,” says Paul Hugunin, head of the state agriculture department’s Minnesota Grown program. “As the number of farmers markets has increased, it is often a challenge for a new market to find enough growers. Farmers who used to go to one or two markets are now going to four or five.” And that means paying more family members to sit at multiple markets.

With so many markets, and returns as low as they are for vendors, North Code Consulting’s Nicholson worries about the viability of markets moving forward, especially those in low-income communities. “Fifteen years from now, markets could all look like the Mill City market, with high-end, specialized producers who appeal to well-educated people with money,” he says. “Products could be mainly certified organic, biodynamic, and value-added like specialty jams and cheeses.”

The future of the markets doesn’t worry Shur Yang, though. “There is always high competition—people going in, going out, and going back in,” he says. “In Hmong culture even if you are not a farmer, you have to know how to do it, to keep yourself busy so you aren’t in trouble and to really know yourself. Do you have the patience or endurance to go through something?” Basically, as long as there are Hmong families there will be Hmong vegetable growers in Minnesota, he says.

So will vegetable farming eventually become Shur Yang’s full-time vocation? “That’s the great debate,” he says. “It’s pretty labor intensive. I can’t move or go anywhere. I can’t go to weddings or funerals in the summer. The idea of me running the farm is in the future. I’ll do it, but not as intense as it is right now.”

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