July 5, 2014 at 1:00 am

Opportunity sprouts from Detroit's urban farms

New market emerging for seed, fertilizer, equipment suppliers

Ruth Hart of Detroit Farm and Garden stacks potting soil. The firm supplies compost and fertilizer to some urban farms. (David Guralnick / The Detroit News)

A new business opportunity is growing alongside Detroit’s estimated 250 acres of tomato plants, cornstalks and trees.

The city’s estimated 1,400 urban farms and gardens have created new markets for farm loan banks and equipment companies that supply them with everything from seed and fertilizer to compost and tractors — just as they’ve done for years with Detroit’s rural counterparts throughout the state.

A small supply store opened in southwest Detroit in 2012. But for the most part, Detroit farms remained an untapped market for the farm supply, equipment and loan industry — until now.

Hantz Woodlands planted the first of its 15,000-tree, 20-acre site this spring, and companies are lining up to get into the game. Lansing-based GreenStone Farm Credit Services donated $50,000 to the project, and Wixom-based Alta Equipment Co. donated $20,000 worth of equipment to help clear and prep the land. Dearborn-based Carhartt provided clothing for the workers.

“Because of the growth in the community, there’s an economic opportunity and there are people who are taking advantage,” said Ashley Atkinson, co-director of Keep Growing Detroit, an organization that coordinates a garden resource program for Detroit’s urban farms.

“The industry’s reached a tipping point; there will be more opportunity for people to take up parts of the supply chain.”

But doing business with Detroit’s urban farmers will require some adaptation on the part of equipment rental companies. Most farms and gardens in the city are 3-5 acres, or smaller, so they don’t need huge machines. And some farmers already share tractors and other equipment among multiple sites.

“It’s not going to be business as usual,” Atkinson said. “But I think that if they’re good business people, they’d modify their business model to work with the opportunities that exist.”

GreenStone, which lends to farms throughout the state, isn’t lending to Hantz just yet. But Randy Stec, executive vice president, said the company wanted to donate to the tree farm to get its name in the Detroit market.

“It was an opportunity for us to do something good for the community and for the residents to understand our role,” he said. “As his project gets more attention, there will be other individuals who look at that area as an opportunity. I think success will breed more success.”

A new industry

Minni Forman, who works at Detroit’s six-farm City Commons collective, said there’s a definite need for compost, tools and machinery to help cultivate City Commons’ 5-10 acres of fruits and vegetables.

But unlike at the now-popular Hantz site, she said no companies are lining up to offer their services to Detroit’s smaller farms.

“For a lot of farmers starting out, they can’t afford to buy (machinery),” she said. “It would have to be a business that would fit in a nontraditional sense to think about the scale of some of these farmers. So much money goes outside of the city even for the small folks in terms of compost or tool rental.”

Some believe the equipment rental companies and farm banks are hesitant to partner with some smaller farms because they’re still trying to understand Detroit’s new industry.

“It’s a new sector that’s emerging, so it’s not defined yet,” said Mike Score, president of Hantz Woodlands. “There’s money to be made. Other businesses related to urban agriculture are at a point where they have to size up the players in the market.”

'A tremendous opportunity'

Detroit Farm and Garden has been sizing up the market since it opened in 2012. The company sells farming and gardening supplies in southwest Detroit. It caters to individual gardeners, but also supplies compost and fertilizer to some of Detroit’s urban farms.

“It’s not an easy business to open, but we saw a tremendous opportunity,” co-owner Jeff Klein said. “The community we have at the store is growing.”

In Ann Arbor, Meredith Kahn co-founded the Ann Arbor Seed Co. in 2012 to provide fruit and vegetable seeds to farmers and gardeners in southeast Michigan. The fledgling company still doesn’t have the supply to help larger urban farmers, but Kahn said she’s interested in doing business with those in Detroit.

“We see a great opportunity to build a catalog of seeds and varieties that do well in this climate,” she said. “We strongly believe part of a strong local food movement is having all parts of that chain.”

Both Alta and GreenStone said they’d be interested in doing business with other Detroit farmers, but Keep Growing’s Atkinson thinks smaller, nontraditional equipment rental companies and money lenders will dominate Detroit’s urban farm scene.

“The scale of urban agriculture in Detroit is much different than agriculture in rural areas,” Atkinson said. “These businesses will be quite different than the businesses that preceded them.”

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