Acting Collectively To Develop Midscale Food Value Chains

Abstract

This paper uses case studies of four innovative U.S. midscale food value chains to provide models of how midsized farms and ranches and associated processing, distribution, and retail businesses can prosper by acting collectively to construct a "third tier" in the U.S. agri-food system. Specifically we consider the importance of acting collectively at three distinct levels: horizontally among producers, vertically within food value chains, and horizontally across food value chains. These midscale food value chains represent strategic alliances among midsized farms and other agri-food enterprises that operate at regional levels, handle significant volumes of high-quality, differentiated food products, and distribute profit margins equitably among the strategic partners. From a market perspective, the key advantage of these food value chains is their ability to provide these high-quality, differentiated products that are not available through the mainstream commodity market.