State departments are concerned that Hawaii’s food producers cannot produce enough to meet their increasing demands, according to a new report.

All 18 state departments were charged with increasing their spending on Hawaii grown produce last year as part of Act 176, which works on a graduated scheme that would eventually see their consumption increase to at least 50% by 2050.

In the first annual report, delivered to the Legislature on Wednesday, the departments raised doubt over whether Hawaii’s producers could meet their demand, the relative expense of local food and general issues over delineating local purchases from their general spending.

The seven departments that did purchase local produce reported they had spent just under $2.65 million. Those seven spent almost $23 million in total on food and value-added products.

Local produce for sale at the Pearlridge Farmer's Market held near Sears. Saturday. 13 feb 2015. photograph Cory Lum/Civil Beat
Farmers tend to find selling their produce through farmers markets or directly to restaurants is easier than supplying state departments because of fewer regulations. Cory Lum/Civil Beat/2015

A shared concern for the state agencies — the departments of education, health, public safety, defense, agriculture, human services and the University of Hawaii — was ensuring there was enough supply to meet the eventual goal, given local produce was generally more expensive than imported foods.

Rep. Scot Matayoshi, who introduced the bill that became Act 176, acknowledges that local produce is more expensive, but helping farmers to increase their supply was integral to one of the bill’s core functions: To increase the amount of locally grown food in Hawaii.

“It’s kind of a chicken or egg thing,” Matayoshi said.

Some departments have existing agreements with suppliers, which do not necessarily trace produce on the basis of its origin and are often charged with taking contracts with the lowest offer. Many state institutions are also pressed to go for the lowest possible price.

Most of Hawaii’s farms are small. Of the 7,300 farms in Hawaii, 80% earn less than $25,000 annually. And while the number of farms increased by about 5% between 2012 and 2017, according to U.S. census statistics, the value of the sector dropped by almost 15% from $661 million to $564 million.

UH Waimanalo Farm Hawaii grown Farmers. Instructor discusses the proper way to harvest Green Onions.
Green onions are among many staple ingredients grown in Hawaii. Cory Lum/Civil Beat/2021

Matayoshi says scaling up farmers’ operations could help lower prices, which means creating longer-term contracts with farmers so that they can seek financing for more land or capital improvements and have greater security.

But there needed to be an incentive for farmers to supply schools and hospitals and state departments. At this stage many farmers would have to hemorrhage their business to do so, according to Hawaii Good Food Alliance Executive Director Harmonee Williams.

“All farmers I know struggle,” Williams said. “The margins are super thin.”

And rather than going through the rigmarole of seeking state contracts that might not pay enough, selling to restaurants or at farmers markets — where they do not face the same scrutiny and regulation — is likely the easier option.

Williams says simply boosting departmental food budgets would be an obvious option.

Matayoshi says the departments will need to prove they have tried before claiming they cannot afford local food. They will need to account for seasonality and be creative, he added.

“We’re not writing them a blank check here,” he said.

In a meeting with the Hawaii Farm Bureau and the Budget and Finance Department, Matayoshi said all agreed that each department needed to lay out a plan for what procurements would be needed to meet the first 10% requirement by the 2025 deadline.

There was a surprising amount of interest from farmers who sought the security of having the state as a customer, according to the Hawaii Farm Bureau.

That could inform their recruitment for suppliers on at least five-year contracts. Those suppliers would then do the leg work to secure the local produce, increasing demand.

Matayoshi is now trying to narrow the focus of the law through House Bill 1568, which would have the local food-purchasing requirement apply only to the departments with the greatest consumption of local food and produce: education, health, public safety, the Department of Defense and the University of Hawaii system.

“Hawaii Grown” is funded in part by grants from the Ulupono Fund at the Hawaii Community Foundation, the Marisla Fund at the Hawaii Community Foundation, and the Frost Family Foundation.

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