In 2017, the USDA Agricultural Marketing Service reported farmers markets in the U.S. are increasing in popularity since it began tracking them in 1994. USDA’s Local Food Directories listed 8,687 farmers markets in 2017, an increase of approximately 42 percent from 2010. USDA estimates farmers markets in the U.S. contribute annual sales of around $1 billion.
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Explore This IssueAugust/September 2019
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In the U.S., foods made in the home and other venues not considered a regulated commercial kitchen (also called a “food establishment”) go by different names such as cottage foods, farmers market foods, homestead foods, home processed products, home foods, home caterer products, or homemade foods. For purposes of this article, “cottage foods” is used to denote those foods not prepared in a regulated commercial facility. As of this writing, all states, except New Jersey, legalized the production and sale of foods produced in the home. New Jersey restricted the sale of cottage foods to religious and charity
bake sales only, but in 2019, legislation was introduced to expand the types of food and the venues where they may be sold.
By supporting cottage foods, farmers market shoppers demonstrate their support for local farmers, which is especially relevant for about one-fourth of all U.S. farmers markets vendors who depend on those sales as their sole source of income. Shopping at farmers markets also encourages local businesses to be successful and stimulates the economic development of the local community.
At the downtown farmers market in Salt Lake City, for example, Jorge Fierro started selling homemade refried beans when he could not find an acceptable product. Shoppers liked his refried beans and his success encouraged him to introduce other new products. With a micro-loan, he opened a small market to sell his refried beans and 40 other products. Today, his products are sold in different retail venues in Utah. He also recently opened an upscale restaurant.
According to the Farmers Market Coalition, growers who sell locally create 13 full-time jobs for every $1 million in earned revenues compared to three full-time jobs created by growers who do not sell locally. Farmers markets with locally owned retailers give back more than three times as much of their sales to the local economy as chain competitors do. About 60 percent of farmers market shoppers in low-income areas also reported those prices were more attractive than prices at their grocery stores. Shoppers further enjoy the pleasant social environment found in farmers markets, where about 15 to 20 interactions occur per visit, creating a strong sense of belonging that improves community life.
American Cottage Food Laws
Cottage food laws in the U.S. are not all the same. Although states have sovereign power on all matters affecting the public health and safety of their residents as well as commerce within the state, the federal government provides guidance to the states through the Food Code (also called the Model Food Code) that is the best advice of FDA on the safety and protection of food at retail and in food service. The Food Code is updated every four years, and as of this writing, the most recent version is Food Code 2017. It contains a uniform system of provisions that are non-binding unless the state or local government adopts it by enacting it into a statute, by promulgating it as a regulation, or by adopting it as an ordinance.
Some states have stand-alone cottage food laws to make the rules convenient and clear to cottage food producers. Although the resulting state or local statutes, regulations, and ordinances are different in scope, design, specificity, and degree of completeness, U.S. food safety laws look similar to one another because of the Food Code.
As an example of how cottage foods are regulated by a state, the Hawaii Administrative Rules Title 11 Chapter 50 Food Safety Code do not use the term “cottage food” but instead define “home kitchen” and “homemade food products.” The Hawaii Food Safety Code allows only non-TCS foods (where TCS means time/temperature control for safety, formerly called potentially hazardous foods) including certain pre-packaged foods and hand-pounded poi, and only when sold directly to consumers. Closely patterned after Food Code 2017, it prohibits the sale of products it considers high-risk unless a waiver is obtained. There are additional requirements of a food handler training course, the typical food ingredient labeling, and a special labeling for hand-pounded poi. All cottage foods sold in Hawaii must also bear a label with the following consumer advisory: “Made in a home kitchen not routinely inspected by the Department of Health.”
Food safety. For food safety purposes, the Food Code categorizes operations as “low risk” and “high risk,” where the latter refers to the handling of TCS foods including sensitive raw ingredients, cooking, hot and cold holding, and reheating. Annex 3 of the Food Code on “Public Health Reasons/Administrative Guidelines” distinguishes “food establishment” that provides food directly to consumers and for which the Food Code applies, from “food processing plant” that provides food to other business entities. The Food Code further defines food as TCS due to its ability to limit pathogen growth or toxin formation, by evaluating its pH, aw, pH-aw interaction, heat treatment, and packaging.
To date, almost half of the states allow cottage foods to comprise only low-risk foods or “non-potentially hazardous foods,” and some states qualify this definition with a list that explicitly includes or excludes certain foods. Almost an equal number of states and the District of Columbia allow the sale only of the cottage foods defined in their provided lists. Some of the lists allow thermally processed acidified foods that, if acidification to pH<4.6 is incomplete, may result in high-risk products. Some states possess tiered cottage food systems to further differentiate cottage foods from other similarly prepared foods, complicating the definition of a low-risk food.
Some states require registration, permit, or license for the premises and others do not. Other states require, in addition, the completion of food safety or food handler course by the operator. Some states require only a food safety training course.
Point of sale. Cottage foods are sold by some states directly to consumers and mostly at farmers markets, while others are limited for sale at specific venues. Other states allow indirect sales of cottage foods, such as in restaurants and at wholesale.
Selling at farmers markets is seen as the end goal for some food producers and as the first step toward a bigger business for others. Thus, there is much discussion on allowable sales at farmers markets. Most states do not cap the maximum sales earned at farmers markets, whereas other states have set maximum sales at $10,000 or less, $10,001-$30,000, and $30,001-$50,000.
Labeling. Most states require basic food labeling. Other states allow only limited labeling requirements (e.g., contact information), while other states do not have any labeling requirements at all.
Food freedom laws. Although cottage food laws in the U.S. are intentionally crafted to be not as stringent as those for food establishments, a few states enacted even broader food freedom laws. Through these laws, the preparation and sale of almost any food and beverage is allowed within the state without licensing or food safety inspection. Wyoming, for example, allows any low- or high-risk food or beverage, including animal products, fish, and rabbit. It does not require licensing, permitting, certification, packaging, or food labeling when sold directly to an “informed end consumer” at a farmers market, or a producer’s ranch, farm, or home, as long as the sold foods are for home consumption only.
North Dakota and Illinois passed their versions of a food freedom law but prohibited the sale of most TCS foods that are also provided in explicit lists. Illinois also requires labeling, has a cap on sales, and in 2018 allowed the sale by a small home-based business of any food or beverage not in the exception list. Maine authorized its local governments in developing their own ordinances to exempt producers of any food directly sold to consumers from food safety regulations (except for meat and poultry operations that remain under federal inspection and licensing).
Cottage Foods Outside the U.S.
Europe. In Europe, farmers markets are also increasing in popularity and for some of the same reasons as in the U.S. About 71 percent of farmers market shoppers in Italy perceived the products are of “high quality” and offer “guarantees of safety.” Consumers are focused on health, their well-being, and the environment. For the shoppers, buying cottage foods eliminates the middle salespeople, making prices attractive, supporting the local business economy, and allowing them to provide instant product feedback through this direct relationship with the farmer or product manufacturer. Farmers markets also offer pleasant social venues with entertainment, cultural, and educational activities.
Italy is the European country with the largest network of farmers markets. According to the leading farmer organization, Campagna Amica, Italian farmers markets contribute an estimated sale of €6 billion. Campagna Amica represents about 500,000 farmers and has 130,000 farm members selling directly to consumers, in addition to other direct-to-consumer markets in many other cities. In Sicily, a regional law authorized municipalities to define the locations and methods of direct sales. Farmers are encouraged to inform shoppers of the direct link with the terroir where the produce or animal was grown and the product was manufactured. The link establishes the specificity of each farmers market, a feature likely to be adopted by other farmers markets in Italy.
Farmers markets in Italy, Spain, and France offer direct-to-consumer sales of regional products that are prepared under established traditions. In Portugal and Greece, farmers markets further inject industrial conventions to their regional and traditionally made products. Although farmers markets in Sweden, the Netherlands, and Germany are more “modern” and commercial, they also sell directly to consumers and address environmental sustainability and animal welfare.
In post-Communist countries such as Russia, Croatia, Latvia, Slovakia, Hungary, Poland, and the Czech Republic, the farmers market, or “villagers market” as it is called in Albania, remains as the traditional channel for local food. Supermarkets are a newer food channel in Albania, being introduced in 2005, and are perceived as “trusted sources of food” but not as the primary sources of organic and good-quality fruits and vegetables. Just as traditional farmers markets are in industrialized countries, supermarkets (i.e. the newer markets) are also used as social places of entertainment. In both the industrialized and post-Communist countries, farmers or producers sell their locally grown or manufactured products directly to consumers.
U.K. Just as with the rest of the world, farmers markets are also popular in the U.K. Farmers markets address U.K. shoppers’ growing interest in locally produced foods they perceive offer better taste and connect them to a “rural heritage” and “culinary traditions,” resulting in a 30 percent sales increase from 2011-2015.
Although supermarkets are commonplace in the U.K., they are seen negatively by some Green consumers. As a result, many shoppers turn to farmers markets to buy locally produced goods they assume are organic, natural, and Green. Shoppers also prefer farmers markets to align with their social, environmental, ethical, and moral values such as fair trade, animal welfare, support and trust in local producers, small-scale agriculture, health, and food safety. Thus, sales of organic food in farmers markets in the U.K. increased by 3.5 percent in 2013 compared to an increase of only 1.2 percent in supermarkets during the same time period. To farmers market shoppers, organic fruits and vegetables are “tastier,” “local, healthy, and environmentally friendly,” and “free of pesticides and hormones” making them “Greener” consumers.
Asia. Although farmers markets around the world aim toward a similar goal of supporting local food production and the health and well-being of the community, the proliferation of markets seems to be related to the demand for organic foods. Most of the information on farmers markets are from studies from North America and Western Europe, and there is little organized information on farmers markets in Asia, Latin America, and Africa.
Although agriculture is especially important to Central Asia economies, their shares of agriculture exports to China, Russia, and the European Union remain limited. These economies believe most of the food eaten in the world is produced by “small-scale food producers and family farmers” who sell their products in local and territorial markets. They further believe they can meet their sustainable development goals at direct-to-consumer markets, such as community-supported agriculture, community-supported fisheries, and farmers markets. But a key factor responsible for the slow increase in exports to China, Russia, and the EU is the slow use of food safety standards.
In 2014, the China Environmental Ministry reported 20 percent of its farming area was alarmingly polluted. China is a country where small-scale agriculture still dominates, and industrialized agriculture comprises only 5 percent of all agriculture. In addition, recent major food scandals such as melamine found in dairy products and cadmium found in rice caused about 72 percent of its residents to be suspicious of the food grown, harvested, and prepared in their country. As a result, its residents searched for food with no pesticides and other “chemicals,” catapulting the organic food market in China to grow 30-fold over the past decade.
In China, as well as in Eastern and Western Europe, short supply chains such as farmers markets are developing fast. Younger farmers using agro-ecological methods bring fresh, “healthy” local produce directly to consumers. Farmers markets in China are seen as building trust-based, direct-to-consumer relations between sustainable family farms and consumers. But many issues remain to be addressed. The organic certification process to verify that food was grown, harvested, and prepared following their strict organic standards must be implemented, and legislation defining how to keep the foods safe must be developed.
Australia. Farmers markets in Australia are also growing in popularity. The Australia New Zealand Food Standards Code—also called The Code—refers to such foods simply as “food” and does not use the term “cottage foods.” The Code focuses on the operation that produces these foods (called a “food business”) and the food produced. A food business in Australia is almost the same as a temporary food establishment in the U.S. Anyone who sells food, including offering free food samples or food prizes and giveaways, is defined as a food business.
The Code defines the national requirements that a food business must meet, including those selling cottage foods. But just as in the U.S. and other parts of the world, the states (or local governments) may have specific exemptions to the national requirements to ease compliance of certain businesses when preparing cottage foods. Exemptions are also not the same and may have different specificity for each state.
Food for Thought
Cottage foods are defined in many different ways and the laws regulating their production and sales, if any, are just as varied anywhere in the world. But food safety remains the first and foremost issue to protect public health since many of the cottage foods are prepared in facilities seldom inspected by a recognized public health agency, and often are not prepared under the same strict guidelines. For example:
- Preparation of high-risk foods to be sold commercially mandates the use of commercial processing equipment that meets regulatory specifications, while most cottage food manufacturers use equipment for home use, such as home pressure cookers;
- Waters used for commercial processing are required to be tested, but are not when used for cottage food preparation (although some cottage food manufacturers use private water wells);
- Commercially prepared food producers in the U.S. are mandated to have a working food safety plan that demonstrates the safety of their food’s ingredients, qualification of facilities and personnel, and conditions of the environment (cottage food manufacturers are not); and
- Proper food labeling, including the declaration of allergens, is a standard requirement on commercially packaged products but is not for all cottage foods.
Since cottage foods are not subject to these requirements, there is likely no history of the hazards in the finished product (including pathogens), the sanitary conditions of the home kitchen, or food safety training of the food handlers. Although many cottage food manufacturers start with low-risk foods, it is not unusual to see line extensions with high-risk foods, such as smoked seafood and meats, beef/turkey jerky, sometimes in hermetically sealed and reduced oxygen packages, and without knowledge of proper processing, refrigeration requirements, and transportation conditions to maintain food safety. And as in many other areas, political and legislative influences could also override food safety issues, consequently limiting regulatory authority.
The underlying rationale for the sale of cottage foods is reasonable, understandable, and addresses contemporary concerns of consumers, farmers, and manufacturers. To align the food safety issues and continue supporting cottage foods, some limitations to cottage food manufacturing need to be considered. It is recommended that cottage laws permit the sale only of low-risk foods and not include thermally processed acidified foods in hermetically sealed containers, unless a waiver is obtained from the local regulator. In addition, and as much as possible, a list of low-risk foods should be provided to guide farmers and cottage food manufacturers in this business. High-risk foods may be prepared, but their public sale should be prohibited and limited to home-use only. Food safety comes before sales—if a food is not safe, it is not a food.
Dr. Saulo is a professor and extension specialist in food technology at the University of Hawaii at Manoa. Reach her at email@example.com.