A regional processing facility with the capacity to quick-freeze area crops would provide an opportunity to divert tens of millions of pounds of wasted agricultural produce into value-added production.
The Western Slope of Colorado produces two of the region’s most recognized fresh produce products – sweet corn and peaches. Palisade peaches and Olathe Sweet Corn enjoy substantial name recognition and consumer preference in their fresh market distribution areas. Annual output averages roughly 72 million pounds of corn and 26.5 million pounds of peaches This represents most of the production in the state and provides about $40 million in income to the area’s producers each year. Agricultural products grown in Delta County and the Western Slope region are distributed throughout a multi-state area during the harvest season. Most growers are generally limited to selling fresh products due to a lack of suitable processing capacity to make preserved products. There are few regional processing options. Those located in other parts of the country are generally an unfeasible alternative for local producers. The lack of suitable preservation options regionally forces growers to dispose of the unsold surplus crop which equates to 10% of the Western Slope’s annual harvest of corn and peaches. This equates to 10 million pounds of wasted produce each year, worth $4 million. This number grows even larger when other types of agricultural produce are considered. Developments in processing, preservation, and packaging technologies, including individual quick freezing (IQF), allow producers to offer innovative, high-quality value-added products to their customers. Possible applications include:
- Dried and frozen consumer end
products such as frozen pieces - Ingredients for commercial kitchens
- Ingredients for food preparation in
schools and restaurants - Ingredients used by value-added
processors for flavorings in frozen
form for making dairy snack
products, baked desserts, soups,
salsas, and beverages
A regional processing facility with the capacity to quick-freeze area crops would provide an opportunity to divert tens of millions of pounds of wasted agricultural produce into value-added production and provide access to alternative sales channels, diversified product offerings, and enhanced local economic activity. Delta County in partnership with other Western Slope communities has completed a Phase I feasibility study that determined sufficient conditions exist to warrant a Phase II feasibility study for developing a regional preservation facility. A Phase II feasibility study will identify an appropriate site for a facility within the Western Slope region. It may be possible to create an Opportunity Fund to activate an IQF project and encourage local growers to participate by investing capital gains.
OPPORTUNITY TYPE
Investor/developer – Initially local growers may be brought together by a larger development entity such as the Delta Development Corporation to invest in an Opportunity Fund specifically geared toward the development of an IQF facility in an opportunity zone. Once complete and an understanding of the potential project is refined, Delta Development Corporation and local growers may consider partnering with other investors at the regional and national level to fill any financial gaps. A developer specializing in IQF facilities should be included in the partnership to complete development and may also provide some level of financial investment.
Local Growers: Due to the benefits an IQF facility could afford local growers, there is a potential opportunity to engage producers. Producers could participate in an investment entity likely structured as an opportunity fund to begin seeding money for an IQF facility.
- Delta County: Delta County could help with site location as it owns property that would be suitable to support an IQF facility. The county could also assist with the entitlement process.
- Region10: Region10 could provide incentive assistance through Enterprise Zone tax credits, Opportunity Zone, and other Colorado business incentives.
- ENGAGE: ENGAGE provides Food/AG business programs that help with food and agriculture-related venture programs. ENGAGE also offers broader entrepreneurship programs that could fit with a new IQF project.
