4 Benefits of Buying at the Produce Auction

Farmers have a variety of options when it comes to selling their agricultural products. Direct-to-consumer outlets like farmers markets and community supported agriculture (CSA) subscription programs typically garner the best price point compared to other outlets, but they are also the most labor intensive and require a significant amount of time and money spent on marketing. Self-managed wholesale to restaurants, grocers, and institutions can be profitable but are also logistically complex, in terms of availability lists, order communications, custom packing, and delivery routes. The ever-changing technological requirements to manage these processes and stay competitive can be a barrier for farmers without those technologies (such as members of the Plain communities). The produce auction, in contrast, provides a one-stop market outlet that allows farmers to spend less time searching for buyers and customizing orders and more time doing what they do best: farming.

Buyers win, too. Produce auctions give buyers a front-row seat to the abundance of the season. For the right price, this could mean walking away with the very first tomatoes of spring (ahead of other market outlets) or the last peppers of autumn. Buying at the auction gives buyers the opportunity to see products and judge their quality before they commit to purchasing. Auctions also give buyers immediate cost benefits (lower prices) when supply is high that might not be reflected in other mediated market outlets.

Despite these benefits to farmers and buyers, some misconceptions remain about auctions. We will attempt to address the most prevalent ones. Here are four benefits to buying produce at auctions. Some of them might surprise you!

1: Auction produce is local and traceable

We have heard the rumors that "you don't know where the produce comes from" at auctions. But that is not true for most of the produce sold at Pennsylvania auctions. Traceability is important to food businesses and shoppers, alike. Many of Pennsylvania's auctions are producer-only, meaning that resellers of non-local products are not permitted. In most cases, the products found at Pennsylvania auctions are locally grown, within the county or region. (The Oxford Produce Auction is a grower-only auction that defines "local" as within 50 miles.)

Some auctions permit the selling of non-local products, primarily to increase the overall variety and to offer products before and after they are available in the local growing season. For some buyers, this is a perk, while others prefer locally grown products. The best way to know about the auction’s sourcing policy is to simply call and ask if non-local produce is permitted, and if so, how a buyer can tell the difference during their visit. Auctions that allow outside produce often sell it separately from local produce.

Every box of produce is labeled with a number that corresponds to the farmer selling it. A farmer's auction number remains the same throughout their career at the auction. This ensures the buyer can trace the produce to the farm it was grown on. Some auctions also carry produce certified for USDA food safety compliance through the Good Agricultural Practices (GAP) program – a requirement of some buyers – with distinct labels and GAP certificates available upon request at the auction office.

The more a buyer hangs around the auction, the more familiar they will become with the growers who sell there, and this will afford an opportunity to ask questions and build relationships. The auction is a highly social community.

2: Quality is a top priority

For many farmers, the auction is their primary market outlet. For others, the auction helps relieve the pressure of excess supply beyond existing sales through other channels – at best, due to a bumper crop or, at worst, due to a deal falling through. Either way, it is in the farmer's best interest to come to auction with top-notch quality. After all, buyers will see the quality for themselves before placing their bids. As mentioned in the previous section, the auction is a social community, built on relationships, and with that comes trust and reputation. Farmers who consistently bring high-quality produce are rewarded with loyal customer relationships that quite literally pay off. Much of the produce sold at auction was harvested within 24 hours – as fresh as it gets without growing it yourself.

Occasionally buyers will have the opportunity to bid on "seconds" (or "number-two") quality produce (those with minor imperfections or inconsistent sizing), which typically garner a lower price. (This can be a good opportunity for chefs and foodservice buyers to support local growers while saving money.) These products will be indicated as such, so the bidder knows what to expect.

3: Prices are competitive

Auction prices fluctuate with supply and demand, just like the rest of the marketplace. When zucchini is in the peak of its season and available from every farm in the state, prices will generally be at a seasonal low. Whereas the first tomatoes of spring and the last peppers of fall will be in limited supply, and the price may be higher, corresponding with the competitive demands of that day’s bidders. Pricing fluctuations at auctions may be more responsive to the marketplace than through wholesale distributors, who might try to "ride out" market fluctuations. This can result in significant savings over other outlets at some times and higher prices at others. This can make budgeting tricky on an item-by-item basis. The key to auction budgeting success is to consider a long-view approach that includes all crops, throughout the season. In a given week, one might pay more for green beans but save big on tomatoes. With some flexibility, a buyer can make the most of auctions' competitive pricing and seasonal abundance.

4: Auctions offer variety and volume

Auctions provide advantageous sourcing opportunities for a variety of food businesses – restaurants, retail farm markets, supermarkets, hospitals, universities, K12 schools, and more. Auctions bring together a wide variety of seasonal products from dozens of farms. This creates a one-stop shop for buyers and makes sourcing from local farms easier than coordinating with each farm individually. For buyers dealing in high volume, auctions are a great solution.

Buyers should consider these factors when planning an auction trip:

• Minimum quantities – Auctions are designed to sell produce in wholesale lots. Lot sizes may vary by auction, but be prepared to go home with 5 or 15 boxes of tomatoes (not just one). Signage near the produce (usually arranged in rows) may indicate box minimums. Sometimes buyers have the option to purchase half-lots.
• Take it home – Auctions expect buyers to pay for and claim their goods on the day of the auction. Bring or hire a vehicle with the proper volume and refrigeration needed to transport winnings.
• Proxy bidding – Some auctions have "order buyers" to bid on behalf of buyers who are unable to attend. Call the auction in advance and ask to speak to an order buyer. Let them know the product and quantity you're interested in and the maximum bid to place on your behalf.

Bonus benefit: It’s fun! Auctions are a great way to feel connected to our food and the people who grow it. Being able to see, smell, and touch (in some cases, taste) the bounty of the season really brings to life the special relationships we share with food and each other.

Ready to plan a trip to the auction? Find an auction near you. 

This work is supported by a Specialty Crop Block Grant from the Pennsylvania Department of Agriculture.