Editor’s Note: This is Part 1 of a three-part series on food production in Hawaii. Parts 2 and 3 will cover food in public schools and the challenges facing island farmers. It stems from the experience this reporter shared in a diary of his attempt to meet the Kanu Hawaii Eat Local Challenge.

Hawaii’s consumers are looking for locally-grown food options, and they’re finding them where they’ve always gotten their food: the supermarket.

Grocery stores, historically in the business of importing food from the mainland or Asia, are starting to dip their collective toe into a different type of model as the locavore movement has taken hold in the islands.

“(Grocery stores) are the entrée point to most kitchens,” said Claire Sullivan, Community and Vendor Relations Coordinator for Whole Foods Markets‘ two Hawaii locations. As the “main distribution channel” for food in Hawaii, supermarkets have a responsibility to support both local agricultural operations and other local food companies, she said.

During a conversation at a table inside the Whole Foods Market in the Kahala Mall, surrounded by customers eating food prepared in-house, Sullivan offered a simple timeline of the evolution of local food in Hawaii:

In the 1980s, a diversified agriculture system began to emerge from the ashes of the sugarcane and pineapple operations that had long dominated the landscape, Sullivan said. In the 1990s, local chefs like Roy Yamaguchi and Alan Wong made locally-grown food a part of their menu, and the early 2000s saw a resurgence in the popularity of farmers markets. But high-end restaurants and farmers markets have a limited reach, and Sullivan sees the rise of local produce in grocery stores in the last few years as an important step.

Of course, smaller operations like Down to Earth, Kokua Market and Umeke Market have been established in Hawaii for decades. But Sullivan’s timeline puts emphasis on Whole Foods’ arrival in Hawaii with the opening of the Kahala store in 2008. In February 2010, a second market was opened in Kahului, Maui, and Whole Foods lists Kailua among its stores in development.

Other major companies are starting to branch into the local food sector as well. Both Whole Foods and Foodland were partners in Kanu Hawaii’s Eat Local Challenge between Sept. 26 and Oct. 2.

“There’s been an example set that’s being emulated by other folks and that’s great,” Sullivan said. The inclusion of other stores in the local food movement can provide Whole Foods the “competitive pressure to keep improving your game.”

Local for the Masses

Foodland operates more than 30 grocery stores across the state, two of which have been branded as “Foodland Farms.” The first opened in Mauna Lani on the Big Island in late 2007, nearly a year before Whole Foods Market Kahala opened its doors. In February 2010, Foodland Farms opened a second store in Aina Haina.

The Foodland Farms grocery store in Aina Haina sells some local produce.

The store’s interior is essentially the same as a typical Foodland. Green decor, employees in faux-denim, and plenty of shipped-in, pre-packaged products like chips, soda and frozen pizza. But the Foodland Farms market also includes a wider variety of island-grown, organic and gourmet food items like Naked Cow butter and four varieties of Hawaiian sea salt.

But while Foodland Farms is described as a “specialty market,” the company is still a market for the general public, and is engaged in competition with other chains like Safeway and Times. And that competition creates financial realities.

“At the end of the day, what we try to do is buy local whenever humanly possible, but it has to make financial sense,” Corporate Chef Keoni Chang said during a tour of the Aina Haina Foodland Farms last week. “I think people want local, of course they want local, but the question is how much more are they willing to pay?”

Foodland carries local products at all of its locations, not just the Foodland Farms stores. There’s local milk, local eggs, Hamakua Springs tomatoes and Hawaiian Crown “Sweet Gold” pineapple. “If you need to buy local, you can come to our store and have a positive experience,” Chang said.

But those local items often sit right next to the imported version, and there can be a steep price difference.

“Sometimes it can be a challenge to hit something that people are going to buy,” Chang said in reference to the price points. Foodland tries to have something for everyone, so Chang said the store “will sell whatever people want to buy.”

Whole Foods has taken a different tack to the something-for-everyone approach. Over 30 years, the company has carved out a niche with a chain of some 270 natural and organic markets in 40 U.S. states and the U.K.

Sullivan said that the decision for many customers comes down not to more local versus more affordable but instead more local versus more organic. There is a store-wide ban on artificial flavors, colors and hormones, and no food products contains antibiotics or preservatives. There are no local eggs on the shelves because Whole Foods as a company purchases only cage-free, and no Hawaii farms can meet that standard. Those rules are not motivated by sales but are philosophical choices, Sullivan said.

Whole Foods carries grass-fed beef from Maui in its fresh case.

Because of the strict standards and the higher prices that accompany them, Whole Foods is generally thought to attract a certain type of upscale, finicky shopper.

Sullivan bristled at the suggestion that Whole Foods is more expensive than other stores, railing against the derisive nickname of “Whole Paycheck.” She argued Whole Foods is competitive with the local chains on many items and it’s unfair to compare prices of items that may look alike but are in fact quite different if the Whole Foods version is organic, local and cruelty-free.

What Is ‘Local’?

Like many consumers, grocery stores have wrestled with the definition of “local.”

For Whole Foods, items are tagged local if they’re grown or made in the state of Hawaii, Sullivan said. For the mainland locations, the company has ruled that an item can be labeled as local only if its ride to the store is seven hours or shorter. Each store manager has the discretion to define the term more strictly, but seven hours is the outside limit, she said.

The Kahala location has identified many of its fish as “Caught in Hawaiian Waters” — meaning it was purchased at the local fish auction. An employee behind the fish counter said Hawaii-based long-line fishing operations stay within 100 miles of the islands.

Many fish caught within 100 miles of Hawaii are sold at Whole Foods Market.

Sullivan said Whole Foods buys from more than 250 local suppliers, including more than 50 local food farms. In the past year, 33 percent of the dollars spent by the Kahala produce department went to local companies, she said. On Maui, that figure was 44 percent because there are more small farms there that can sell to the Maui store but can’t ship inter-island.

Foodland also tries to buy local.

“It speaks to the debate about globalization and efficiency,” Chang said. “We’re able to support a lot of local companies in the food chain.”

One of those local companies is Foodland itself. Started more than 60 years ago and still owned and operated by the Sullivan family1, Foodland often boasts that it’s “Hawaii’s largest locally-owned and -operated grocery retailer.” Corporate Communications Director Sheryl Toda said she makes it a point to include that phrase in every company press release.

But while the company is proud of its local roots, it takes few steps to highlight the local-ness of its products in the store. During the tour of the Aina Haina Foodland Farms, Chang, who designs the recipes for the prepared food items behind the deli counter, pointed to a tofu salad that includes local tomatoes but isn’t advertised as local.

He said that’s because the recipes vary based on the availability and price of local produce, and changing the sign each time the food is made would become unwieldy.

This tofu salad at Foodland Farms has some local ingredients, but isn’t labeled as such.

Elsewhere in the store, items are identified as being from the U.S.A., per federal country-of-origin regulations. But there’s often no indication of whether that means it’s from Hawaii, California or somewhere else.

Whole Foods has taken steps to make sure customers know whether an item is local. Sullivan said the store employs a full-time sign-maker who works on chalkboards and signage for hundreds upon hundreds of items. In the salad bar, some items include detailed descriptions that tell consumers specifically which ingredients are locally sourced — for example, the daikon radish in a daikon and carrot salad.

Chicken or the Egg?

Telling customers where their food comes from is only half the battle. Convincing them they should pay the premium for local food is the hard part.

A number of factors force up the price of local food, but the most important is the limit on land in Hawaii and the fact that huge farms on the mainland can take advantage of the economies of scale to drive down the per-unit price.

There’s also an added cost associated with dealing with dozens of small, local farmers rather than a handful of distributors that can bring in an entire store’s worth of food on their own. Sullivan, the Whole Foods buyer, said she’s listened to many a sob story from local farmers who, for one reason or another, couldn’t ship product as scheduled.

So if a a shopper sees two similar products on the shelf with different prices, they need a good reason to splurge for the local item. It becomes an even tougher sell when local products don’t meet customer expectations for color and size. And if a product — subject to the whims of weather, pests and other harsh realities — becomes unavailable, customers are going to run to the competition.

Striking the balance between satisfying existing demand and shaping future demand has become a chicken-or-egg conundrum for the stores.

Whole Foods works with farmers to find solutions, Sullivan said. The store is currently working on a deal with a local producer to grow organic local Williams bananas — those are the big ones, not apple bananas. It’s moved beyond a “wish list,” with the parties starting to discuss the volume of the market and the purchase price. Armed with a promise — “If you grow it, I’ll use it” — the farmers can move forward on a larger land lease or infrastructure purchase with confidence, Sullivan said.

Foodland has struck deals with some local growers, including Nalo Farms of Waimanalo. But some partnerships haven’t gone as well. When Foodland Farms started purchasing Kauai shrimp, it was only able to sell 10 percent of its stock, so they stopped carrying it, Chang said. Big Island-grown steaks don’t move in high enough quantities and need to be frozen so they don’t go bad waiting on the shelf.

Foodland Farms carries local beef and steak, some frozen and some fresh.

Both stores have started to be pro-active. In addition to including local items in prepared food and offering promotions, coupons and price breaks for some local items, stores can use demos to make customers more familiar with an item or to show them the best way to use it. Sullivan describes that process as “expanding the community’s palate.”

“There’s a ton of inertia” to overcome, she said. “Effecting change takes time, effort and education.”

With locally-grown and locally-made food now available on grocery shelves across the state, it’s up to consumers to decide how they want to spend their hard-earned dollar. And how they make that decision will shape the future of food in Hawaii.

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