In the last year, one of the major challenges facing elementary and secondary schools has been finding sources for commodity foods. Unfortunately, with the scarcity of labor and supply, schools have had difficulty not only locating products for the school year, but finding suppliers who can deliver them.
In its latest live panel, the Elementary and Secondary Foodservice Leadership Council unpacked the complexities of the K-12 USDA commodities program and pointed out the advantages of considering entering the segment as a supplier.
USDA Foods in School Programs and Its Importance
The USDA Foods in Schools program - e.g., still largely referred to as “commodities” - supports domestic nutrition programs for use by schools and institutions participating in the National School Lunch Program (NSLP), the Child and Adult Care Food Program (CACFP), and the Summer Food Service Program (SFSP), according to the USDA. Commodity foods include fruits and vegetables, meats, cheese, dry and canned beans, fruit juices, and other grain products, as listed on the USDA Foods in School website.
Dan Ellnor of Jefferson County, Kentucky Public Schools estimated schools serve about 30 million meals per day nationally encompassing an $18 billion dollar industry. Of this total, Ellnor said about $1.3 billion is composed of commodities alone.
“About 15-20 percent of the K-12 plate should be USDA commodities, which is equivalent to about 20-30 cents per plate for our schools,” Ellnor said of Jefferson County. Ellnor said commodities average only 7-8 percent of his schools’ share, largely due to the dearth of commodity suppliers. “We are talking here today to try to change that,” he added.
The Process of Becoming a K-12 Commodity Supplier
“I’ll go ahead with the 50-state disclaimer for those who are familiar with the USDA program- as is standard practice,” said Garrick Howell, President of the American Commodity Distribution Association (ACDA) in the state of Kentucky.
“There are 50 states - or 50 little fiefdoms - that manufacturers have to keep up with which can be a challenge,” he said. “Every state runs its program a little differently,” he added, because each state is in a better position to understand its local needs.
Three Ways to Become a K-12 USDA Commodities Supplier
| Processes | Comments |
| Agricultural Marketing Services (AMS) | The Agricultural Marketing Service (AMS) administers programs that create domestic and international marketing opportunities for U.S. producers of food, fiber, and specialty crops. |
| State Approval | USDA Foods further processing allows state distributing agencies (SDA) and recipient agencies (RA) such as school districts to contract with commercial food processors to convert raw and/or bulk USDA Foods into a variety of convenient, ready-to-use end products. |
| Department of Defense (DoD) | The United States Department of Agriculture (USDA) Department of Defense (DoD) Fresh Fruit and Vegetable Program allows schools to use USDA Foods entitlement dollars to buy fresh produce. The program is operated by the Defense Logistics Agency (DLA) at the Department of Defense. |
Source: Elementary and Secondary School Foodservice Leadership Council, USDA
While the process can seem complex, Howell said Kentucky really only requires a manufacturer have a national processing agreement in place. “That tells us that you [manufacturer] have been through what orientation you need with the USDA and you know what the guidelines of the program are.”
Manufacturers: “Get in the Game”
Adam Russo, of Prince William (Virginia) Public Schools, was direct in his call for more suppliers to enter commodity processing in schools. “We typically have 1,000 foodservice workers and we are down to just 700,” Russo said. “Now, when we receive bulk ground beef, we don’t have the staff to put it into patties so I’m here to ask manufacturers to fill that void.”
Russo said he plans to start purchasing more value-added products with the shortage of labor, but the shortage of value-added suppliers is another issue.
Cargill is one such supplier, however, which has served K-12 schools since the 1980s with its Sunny Fresh Eggs and continues to serve the segment for a variety of reasons.
“You often hear of K-12 being the largest restaurant chain in America. There are 30 million students across 100,000 school districts, 5 billion lunches served annually, 2.5 billion breakfasts served annually,” said Suzanne McCarty of Cargill Foodservice. “It also gives us an opportunity to bring good tasty food to students and it’s also important to Cargill as an agricultural company.”
Benefits of a K-12 Commodity Processor
| Benefit | Comments |
|
Near-In Opportunity |
There is a shortage of commodity suppliers. |
|
Volume |
30 million students across 100,000 school districts; 5 billion lunches and 2.5 billion breakfasts served annually. |
|
Social Good |
Be at the forefront of feeding our school children healthy and nutritious foods. |
|
Collaboration |
Unlike other segments, there is collaboration among suppliers, schools and the USDA. |
|
Future Customers |
Build awareness and trust with the school-aged as they become adults. |
While Cargill has been a success, McCarty acknowledged the segment is tricky. There are “lots” of acronyms to contend with, state-by-state regulations, and bureaucracy. “It’s not easy,” she added, “but there are lots of opportunities to collaborate with schools and to use USDA as a valuable resource.”
About the Foodservice Leadership Councils: In the fall of 2018, several leading operators across different industry segments approached IFMA looking for help. They felt their communities were underserved in the areas of insights, business best practices and more effective connectivity with manufacturers. They also recognized the opportunity to learn from each other and the broader industry to better serve their customers.
For operators interested in learning more about the ongoing council work and access to upcoming resources, visit IFMAworld.com/council, or contact Jim Green at jgspartan@aol.com. You will receive updates on council activities and have complimentary access to whitepapers, webinars, and conferences.