‘Buy local’ programs deceive U.S. consumers
As local-food sales grow into a $20 billion industry, a USA TODAY NETWORK investigation found that state branding programs designed to inform consumers and support local farmers are deceptive and virtually unregulated.
These “buy local” programs purport to connect shoppers with food from their states by affixing logos and stickers.
Yet most state food-branding programs certify products as “local” even if half the ingredients come
from another state or country. Many states have no minimum ingredient requirement.
Think of it like this: Coffee beans don’t grow in Utah. They must be imported. “But if you roast the beans here, you’re qualified for the program,” said Wayne Bradshaw, marketing and economic development division director for the Utah Department of Agriculture and Food, which runs the “Utah’s Own” program.
The same is true for tea brewed in Alabama, peanut butter processed in Oklahoma and potato chips cooked and bagged in Virginia. The main ingredient can come from around the world or across the country.
Over the past four months, USA TODAY NETWORK reporters reviewed food-branding programs in the 45 states that have them. They analyzed rules, enforcement actions and the criteria each state requires to be considered local.
They found:
18 states set no minimum on the percentage of locally grown ingredients a product must contain to get a state brand.
20 states brand food as local as long as the company making it is headquartered within the state.
36 states have no formal annual review process to check whether companies are following program rules. About two dozen states let companies sign up and call their food local without verifying the source of ingredients.
40 states have no record of enforcement actions in the past five years and no record of removing specific companies from their programs.
Program officials in nearly every state say they aren’t attempting to fool consumers by tapping the farm-to-table-movement. But they acknowledge the programs are more about marketing efforts to promote the local economy and create jobs.
“It’s a way for small to medium-sized businesses to inform consumers that their products are locally made,” said Lori Panda, director of the “Ohio Proud” program. “It’s a good way for consumers to feel good about supporting the local economy.”
But many programs emphasize food in slick marketing campaigns that food and farm researchers say make shoppers think they are buying products that are made with local ingredients or come from local farms.
Across the country, 20 programs use the words “grown” or “fresh” in their names. The rest of the programs trade on that concept with “made,” “proud,” “taste” and “preferred” in their titles.
Brochures and websites often picture crisp produce, cultivated fields and profiles of farmers.
Click on the “Georgia Grown” website, and you are transported to an agricultural display of in-season crops, farmer’s-market bulletins and directories about Georgia pecans.
“Georgia Grown is also a brand with deep roots in sustainability, quality and integrity,” according to the website.
The program requires that produce be grown in the state to use the label. But Georgia officials do not annually inspect farms or verify food sources. The Georgia Grown label can be put on products manufactured in the state, so long as the “key ingredient” or at least 50 percent of ingredients in processed food comes from Georgia.
The visibility of these state brands depends on where you live. Shoppers in Arizona might have trouble finding branded items in stores. In Kentucky, however, some grocery stores feature kiosks crammed with branded products.
The overwhelming majority of state branding programs rely on taxpayer funds and are managed by state departments of agriculture.
Budgets are supported primarily through a combination of state funds and membership fees paid by farmers or business that use the labeling.
Some food researchers say the lack of uniform regulations and the number of food-branding programs not only undermine consumer confidence, but also devalue the meaning of “local” food.
“The word ‘local’ is chic; it sells things,” said Cindy Fake, horticulture and small-farms adviser for the University of California Cooperative Extension. “So it’s used by everybody and anybody.”
Fake said the word “local” has no clear definition and consumers are easily misled.
“They are likely to be deceived,” she said. “Consumers are thinking one way, and the marketers know that. They know consumers want local, so they say it’s local.”
‘Local’ may not mean local
Most states allow food products to be labeled “local” even when ingredients are trucked in from elsewhere.
Milo’s Tea Co. in Alabama makes iced tea. A lot of it. The family-owned company distributes as many as 100 semi loads of tea across the country every day. Its gallon jugs with their distinctive red labels can be found in most major stores.
The company’s signature sweet tea has three key ingredients: water, pure cane sugar and tea. Every day, it goes through 7 tons of tea leaves, which are recycled and turned over to the city of Bessemer for composting.
But Milo’s doesn’t get its tea leaves from Alabama farmers.
The leaves come from South America and India, according to company brand manager Alison Pierce.
That’s not an issue for “Buy Alabama’s Best,” the state branding program, which promotes Milo’s on its website and provides the company a logo to use in store displays.
Local ingredients are not a requirement to be a member of Alabama’s program. Because Milo’s makes its tea in Alabama, it qualifies for membership.
“In recent years, there has been a national trend of consumer interest in locally-made products,” Pierce said in an email. “(Buy Alabama’s Best) has also been instrumental in communicating to consumers in Alabama, that when they buy a Milo’s item they are supporting a family-owned company and helping create jobs in their home state.”
Alabama is not unique. Each state imposes its own standards and minimums on ingredients, from none to 100 percent. “There is a huge diversity across states about what is local,” said Gail Feenstra, deputy director of the Sustainable Agriculture Research and Education Program at the University of California Division of Agriculture and Natural Resources.
Feenstra said there is more transparency on fresh produce because it’s easier for consumers to identify where it came from and recognize regional products on store shelves.
But shoppers need to do their research, she said.
Remember those coffee beans shipped to Utah roasting companies?
Park City Coffee Roaster is one of several coffee companies promoted through the Utah’s Own branding program.
Founded in 1997, the small-batch roaster is located in the upscale resort community, which hosted events during the 2002 Winter Olympics.
Park City gets its beans primarily from South America and Africa. The company’s website emphasizes that it does all its roasting locally.
That’s enough to qualify for membership in the Utah’s Own food-branding program, said Bradshaw at the Department of Agriculture.
Bradshaw said Utah’s Own’s mission is to educate food lovers about the economic impact of supporting local, small food producers and showcasing producers.
“For Utah’s Own, it’s anything locally grown or produced,” he said. “Our boundaries for local are the state of Utah.”
He said Utah recently revamped its program with a new website, a more diverse budget, a stricter application process and an annual membership fee. The program’s goal is to connect consumers with local producers.
“There is a consumer awareness of Utah’s Own,” Bradshaw said. “We did a survey, and 90 percent of people ... had an accurate sense of what Utah’s Own means.”
He acknowledged Utah’s Own doesn’t act as a regulatory agency and doesn’t monitor companies once they are approved.
“We don’t have the staff to go out and police everyone,” he said. “We only respond to instances where somebody has reported misuse of the label.”
Ga. peanuts, Okla. peanut butter
Consumers opting to reach for peanut butter on grocery-store shelves in Oklahoma are often willing to pay more for jars branded as “fresh” and “local.”
Drought and other rising farm prices have decimated Oklahoma’s once-burgeoning peanut crop. The state once boasted a half-million acres of peanut farms and has been reduced to about 16,000 acres, according to reports.
Peanut-butter manufacturers who once grew their own peanuts are buying them from companies in other states, mostly in the Southeast.
Out-of-state peanuts don’t prevent companies from putting the “Made in Oklahoma” label on their products. Or charging more for the products as a local specialty.
“You can bring in peanuts from out of state, and as long as you’re processing them into peanut butter in Oklahoma, it can be labeled as Made in Oklahoma,” said Jamie Cummings, market development coordinator for the state Department of Agriculture, Food and Forestry.
Snider Farms Peanut Barn says on its website, “We only use fresh, locally grown peanuts.” But owner Stephanie Snider said the family stopped growing peanuts a few years ago and now gets them from a Virginia company.
The peanuts come mostly from Georgia and Virginia. They are shipped to a distributor just a few miles across the state line, in the Texas Panhandle, Snider said.
The Peanut Barn buys raw shelled peanuts to cook and flavor or grind into paste for its handcrafted and popular Natural Peanut Butter.
“We manufacture everything in Oklahoma,” she said. “Everything we do to (peanuts), we do in Oklahoma.”
Snider said they sell the peanut butter at farmer’s markets, in small batches to gift stores and wholesale to retailers throughout the state.
She said the Peanut Barn sells 16ounce jars directly for about $5. “Most of our business is wholesale and they will sell it for $6 or $7. More than we do.”
She said the Made in Oklahoma brand definitely boosts sales. She said local customers respond to the local label and seek out products made in the state, even if the price is higher.
“A lot of the larger stores we sell to like the Made in Oklahoma label,” she said. “That’s what they are pushing.”
Shoppers pay a premium
Local peanut butter isn’t the only product for which consumers will pay extra.
Ohio sums it up starkly on its “Ohio Proud” website. It said a survey found people “would be willing to pay up to 50 cents more for items made in Ohio.” Likewise, South Carolina found people would pay a 27.5 percent price premium for state-grown produce.
Is that what Ohio and South Carolina are delivering? Not always.
Both states put their brands on products only partially produced there.
To become an Ohio Proud member, a food maker’s product must be made up of at least 50 percent of ingredients “raised, grown or processed in Ohio.” That means half the ingredients can come from another state or country.
South Carolina has no minimum on ingredients. The “Certified South Carolina Product” program includes agricultural and food products, manufactured or processed in the state, that “may or may not” include ingredients grown exclusively in South Carolina.
Produce must be grown in the state to be qualify as “Certified South Carolina Grown.”
Shane Burgman, 30, said he knows locally produced food is pricier. He looks to purchase berries, eggs and other items produced in his home county around Melbourne, Florida, but said a state logo isn’t important.
“You pay a premium,” he said. “Sometimes it’s worth it, sometimes it’s not.”
Researchers at the University of Minnesota Extension, in a 2014 study, said “there is no professional or academic consensus on the term ‘local food.’ ” Some define it by the distance between the farm and the market. Others politically, by state boundaries. Still others define “local” ethically — by the way food is produced, distributed and consumed, researchers said.
There is, however, consensus on the bottom line. Multiple state branding programs point to a U.S. Department of Agriculture study on the explosion of local food sales.
It found sales increased to $1.2 billion in 2007, from $511 million in 1997.
According to a study by food industry research firm Packaged Facts, local food sales are projected to jump to $20 billion in 2019.
State programs maintain that buying local helps to create jobs, build sustainable communities and protect agriculture resources.
But slick marketing efforts to capture revenue risk alienating consumers, according to researchers.
“The idea of relatively homogenized programs seems counterproductive to the motives of why people turn to local food,” said Matthew Mars, assistant professor of agricultural leadership and motivation at the University of Arizona.
“It creates an inherent conflict,” Mars said, adding the lack of uniform regulations and guidelines undermine consumer confidence. “From that you could say they are deceived.”