Byline: Susan Lightfoot Schempf and Pete Huff. Ms. Schempf and Mr. Huff are the Co-Directors of the Wallace Center, a national nonprofit organization that brings together diverse people and ideas to co-create solutions that build healthy farms, equitable economies, and resilient food systems.
The U.S. government is one of the country’s biggest grocery shoppers, and where it shops can determine who wins and loses in U.S. agriculture.
Between 2018 and 2022, the U.S. Department of Agriculture (USDA), the Department of Defense, and other federal agencies spent more than $33 billion on food, according to the U.S. Government Accountability Office. This massive grocery budget supplied military bases, school cafeterias, tribal governments, and organizations feeding some of the most vulnerable people in communities across the country.
However, a recent Federal Good Food Purchasing Coalition report finds that the biggest winners of government food contracts are often America’s largest food corporations. In 2022, USDA’s top 25 vendors—representing 8% of the total number of vendors — collectively received half of total spending. These companies largely produce commodities and processed, prepackaged foods, many of which are designed to be cheap rather than healthy. By purchasing large quantities of food from major companies, the federal government contributes to the consolidation of the agriculture and food sectors. This concentration reduces choices across the board: farmers become “price-takers” rather than “price-makers” due to a lack of competitive buyers, food chain workers have fewer employment options to negotiate better pay and working conditions, and consumers face higher prices as fewer companies dominate production, distribution, and what’s on store shelves.
We must ask ourselves: Should such a significant portion of our tax dollars fund large food corporations that, due to their operational concentration, are more susceptible to disruptions like those seen during the COVID-19 pandemic? Or should America’s money be used more strategically to transform the American food system into one that sustains small and medium-sized family-owned farms, who support shock-resistant supply chains?
Strengthening local and regional food supply chains
We’re not simply talking about values-based grocery shopping. Diversifying federal food purchases also strengthens local and regional food supply chains. When the COVID-19 shutdowns hit in March 2020, grocery store shelves emptied and the percentage of children experiencing food insecurity doubled — yet American farmers were dumping out gallons of milk and letting fields of vegetables go to rot. The Federal Trade Commission recently concluded that one of the causes was “excessively consolidated supply chains.”
Thanks to the USDA’s own actions, more nimble, diverse supply chains on local and regional levels came to the rescue. One of the agency’s pandemic-era solutions to make food supply chains more resilient recognized the importance of local and regional food supply chains. Not only that, it has proved remarkably effective. Over the past two years, the Local Food Purchase Assistance (LFPA) program, administered by the USDA Agricultural Marketing Service, has helped more than 6,000 farmers, ranchers, and producers feed their communities while bolstering local food and farm businesses and the local economies they operate in.
According to a 2023 program analysis by researchers at our organization, by the end of 2025, participating farmers, ranchers, and producers will earn a total of $691 million through LFPA. When you look at the ripple effects of these government purchases — how these farms spend their earnings and hire workers in their communities — the potential economic impact to local economies may be as much as $1.5 billion.
Yet the LFPA will sunset after 2025 if Congress doesn’t reauthorize it as part of the next Farm Bill.
Extending COVID relief to small and medium size farms
As part of the 2021 American Rescue Plan Act, the USDA allocated almost $900 million to create the LFPA. The program has since distributed funds to all 50 states, as well as three territories and 28 tribal governments.
Iowa, for example, received $5.6 million to supply food banks and tribal food sovereignty programs with fresh produce, meat, and dairy. The nonprofit Iowa Valley Resource Conservation and Development has coordinated the effort, and as of July 2024, 251 participating farms have supplied food to 819 food pantries, early care education sites, and senior centers in their own communities.
One of the Iowa farmers LFPA is helping to grow is Shaffer Ridgeway, a soil conservation specialist in Waterloo. In 2019, Ridgeway started Southern Goods, his three-acre farm, to grow sweet potatoes, okra, greens, and other Southern heritage vegetables. Before LFPA, he had never been able to sign long-term contracts with food banks or other institutions. Instead, he grew small amounts of more than 20 crops, putting in a lot of extra effort to sell his food through farm stands and farmers’ markets.
Now that 75% of Southern Goods’ produce goes to Ridgeway’s local food bank, his young business can expand. He has bought new irrigation equipment and tractor implements from local farm-supply companies. He’s hired two part time workers. And customers at the food bank have memorized his delivery schedule, clearing the shelves of Southern Goods’ healthful, culturally responsive vegetables soon after they arrive.
Like many producers participating in the program across the nation, LFPA has opened up a local market channel where he gets a fair price for his products. In Ridgeway’s own words, “A fair price equates to fair wages, equipment purchases—and happier farmers, to be honest.”
Using LFPA to build a resilient supply chain
The Local Food Purchase Assistance Program allows farmers to feed people in their own community — something small and medium–sized farms know how to do well. And it proves we can put healthy, locally grown food on the plates of schoolchildren, seniors, and vulnerable Americans.
As this vital program’s end date is approaching fast, we need Congress to take action now by permanently funding LFPA through the Farm Bill. Given the size of the federal government’s annual grocery budget, Americans have a right to demand the government spends that money more wisely to help everyone — not just the big guys.