Produce Reigns in Chicago

The Windy City benefits from its convenient location.

Chicago may be known for its pizza, towering skyscrapers and blues legends, but in the city, and many surrounding suburbs, produce also reigns supreme.

It benefits from its convenient location in the center of the country, many surrounding farms, as well as its internationally lauded restaurants and tight-knit supermarket segment.

The Illinois Agricultural Association was formed in 1819, just months after Illinois became a state. In 1853, the association became the Illinois State Agricultural Society and was active until April 15, 1871, when a new state constitution created the Illinois Department of Agriculture, overseen by the State Board of Agriculture.

Today, the Illinois Department of Agriculture has an annual budget of more than $100 million and employs more than 300 people statewide.

Chicago has a long history of agricultural involvement, which continues today through The Chicago Farmers. Founded in 1935, the purpose of the nonprofit, nonpartisan organization is to advance production, agriculture and agribusiness.

THE WHOLESALE CLIMATE

The Chicago International Produce Market (CIPM) provides a one-stop wholesale shop for Midwest produce buyers, including those representing area supermarkets, independent markets and chain and independent restaurants.

Established in 1995, Coosemans Chicago Inc. is one of the 22 businesses that are part of CIPM, and primarily handles specialty produce and broadline, according to Mark Pappas, Coosemans’ president.

Like many regions, the Chicago area has seen a great deal of wholesaler consolidation, he notes, along with increased use of technology, with orders being emailed.

“The advantage to doing business in Chicago is that it is a big city known for its cuisine,” says Pappas. “There are a lot of ethnic choices.”

The company benefits from its proximity to both O’Hare and Midway airports for air freight business.

“We do a lot with B&W Quality Growers out of Florida with arugula and watercress, which have become more mainstream,” says Pappas. “Spring mix used to be a specialty item, but now is a commodity.”

Another long-standing produce supplier, The Ruby Co., based in the Chicago suburb of Buffalo Grove, was established in 1966.

“The vast majority of our business is potatoes and onions,” says Josh Wolff, vice president of growth and strategy. “However, over the last few decades, we have expanded our operations and capabilities to support more customers, across additional segments with a wider range of commodities.”

Now, The Ruby Co. has an expanded list of core offerings they focus on. “We now handle a lot of West Coast commodity business and can offer less than full truckload deliveries to near anywhere in the U.S.” says Wolff.

Although the company has a warehouse at the CIPM, it primarily services large-scale national and regional retail systems; foodservice brands; broadline distributors; regional and specialty distributors; and processors.

“Our Chicago operation is mainly focused on servicing local and regional retail systems, local distributors and foodservice providers. We have regular inventory of core potato and onion products that support customers large and small,” says Wolff.

He adds it is beneficial to do business in the central U.S.

“At times, we bring product into Chicago and utilize it as a redistribution point, depending on the state of the freight market,” Wolff explains. “It is a great market for outbound freight. The Midwest is a centralized region with a lot of distributors, wholesale and retail density, making the area and terminal an anchor for the region in terms of produce supply.”

The last few years have been a rollercoaster of challenging logistical and supply markets, but Wolff adds that the past 12 months months have felt like a reset.

“There is an overabundance of freight capacity while demand has come down, resulting in cheaper freight. It is the most basic form of supply and demand,” says Wolff. “As a result of market conditions, there is more competition on the supply side, so we’re continuing to find new ways to deliver value to our customer base.”

The company also is utilizing data and analytics to make operational and strategy adjustments based on market trends.

“As we enter into the summer months, we will be focusing on seasonal offerings such as watermelons, with pumpkins to follow soon after,” says Wolff. “The Ruby Co. has Sweet Mama Produce, which is an umbrella business of our grower/shipper that provides watermelon, pumpkins and lettuce.”

Another longstanding produce supplier, La Hacienda, is both a retailer and wholesaler that has been operating in Chicago for half a century. It specializes in Mexican produce.

“We just expanded our cash-and-carry business,” says Adolfo Vega Jr., produce manager. “It grew from 5,000 to 35,000 square feet, has a format like Costco and is more accessible.”

In addition to produce, La Hacienda sells 3,000 other items, including dairy and grocery.

“There is a lot of business here, many ethnic groups and diverse products,” says Vega. “However, there also is a lot of competition. There used to be lettuce houses, tomato houses, etc., and now everyone sells everything.”

La Hacienda services both foodservice and retail customers, but recently began focusing on independents.

“We have relationships with many growers, so we know when to ship,” says Vega. “It’s always the same growing pattern annually. We have relationships with growers, so we can sometimes get better deals.”

Although based in Pennsylvania, Basciani Foods has had a small pack house in Chicago for the last 40 years. The company provides mushrooms to retailers, but is stronger in the foodservice segment.

“There are two families that have worked together for four decades providing mushrooms from the Chicago area,” says Chief Executive Michael J. Basciani Sr.

“Midwesterners love mushrooms, and we deliver to our customers two to three times a day, so the proximity is great,” says Basciani. “People in Chicago are very loyal, and so are we.”

The company is currently expanding its growing rooms, with a 200,000-square-foot addition for white and exotic mushrooms.

“We’re always expanding our pack houses and farm, and increasing quality control,” says Basciani. “We also are green farming with solar energy and different types of racking for increased efficiency. In addition, for years we have been recycling everything on the farm.”

A RETAIL GLIMPSE

There have been new developments in Chicago’s retail segment over the last year, primarily the city’s grocer tax. According to a March 2024 Supermarket News article, Chicago could lose $80 million if the city’s grocery tax is eliminated.

The Illinois Municipal League (IML) has opposed a plan to cut the 1% tax, which would cost the state’s cities millions in revenue, according to Supermarket News. Although the tax is collected by the state, the funds are redistributed to municipalities, and the biggest benefactors could receive $4 million annually. However, the IML contends the total loss to municipalities is $325 million a year.

In other news, in a November 2023 article, the Chicago Tribune revealed that, in the last two years, major grocers have closed at least six stores on the city’s beleaguered South and West sides, making it more difficult for residents to purchase fresh and affordable groceries.

In September 2023, Chicago Mayor Brandon Johnson’s administration announced it planned to explore creating a municipally owned grocery store for better access, according to the Chicago Tribune.

By contrast, high-end, family-owned retailer Sunset Foods, founded in 1937, operates five locations in the north suburbs of Chicago.

When COVID-19 was at its peak, Sunset Foods bought two more stores along Chicago’s North Shore close to its main store in Highland Park. These will remain under the Grand Food Store label.

“The Chicago area is a very competitive market, with different levels of grocers,” says Vince Mastromauro, director of produce and based in Sunset Foods’ Highland Park corporate office. “We consider ourselves upscale, so the key for our market is bringing in quality produce at the highest grade.”

He adds that offering value and service is a recipe for success, along with a big variety. Some of the stores’ bestsellers include Honey Crisp, EverCrisp and Envy apples; Texas grapefruit; and heirloom navel and Cara Cara oranges. Customers also are looking for organic leafy greens, Swiss chard and kale, as well as broccoli, cauliflower and berries. The cleaner the product, the better.

“I have a Driscoll program through a wholesaler that has been very successful,” notes Mastromauro. “We promote the heck out of our home run hitters, and there always is new fruit. I make sure my name is on the list for new items.”

During the colder seasons, Sunset Foods sources produce through its main wholesaler, which is aware of the store’s preferred grade, specs and sizes. In the summer, the retailer tries to source most of its corn and summer vegetables locally.

“We are working with a new farm this year, since the owner of the farm we worked with for 60-plus years retired,” says Mastromauro, who recommends retailers align with the best growers and top brands in the industry.

Another established retailer, Fresh Market Place, is a product of the Marinis family’s 50 years of combined grocery experience. The Western Avenue store was established by European immigrants Louiza and Peter Marinis and is now run by their three children.

“Produce takes up about 20% of the store and makes up 25% of our sales,” says General Manager Kosta Drosos. “We have a great mix of organics, conventional items and grab-and-go items like chopped veggies and cut fruit.”

Fresh Market Place sources fruit and vegetables locally, when possible, from area farms during the spring and summer.

“There also are a vast variety of local items year-round, like mushrooms and microgreens,” says Drosos. “We have a great balance between organic, conventional and locally sourced produce in about 5,000 square feet of space.”

Microgreens and mushrooms are currently bestsellers.

“Chicagoans don’t miss an opportunity to take advantage of the seasonality of fruit and vegetables. In winter, customers are into citrus, while in summer, it’s berries and watermelon,” says Drosos. “Our customers know what’s in season and when to buy things, and we are well educated on what to buy and when to buy it.”

He adds there has been an urge to support local farmers, not just farmers markets.

“Some farms have a cult following,” says Drosos. “So, the more local farms I can bring in, the better for business. People want to know where their food is coming from now more than ever.”

FARM TO TABLE FOODSERVICE

Foodservice is big business in Illinois and the Chicago area. According to statistics from the Washington, D.C.-based National Restaurant Association, Illinois has 26,543 restaurant locations that take in about $42.6 billion in sales annually.

Like in the rest of the country, farm-to-table restaurants have been sprouting up in and around Chicago in recent years. These eating establishments focus on incorporating locally sourced produce in their dishes.

Farm Bar, with locations in Chicago’s Lakeview and Ravenswood neighborhoods, originated in 2011 with the opening of Farmhouse Tavern in River North. The restaurants source much of the produce from Brown Dog Farm in Mineral Point, WI.

“This is a 140-acre farm and 200-tree orchard that is three-quarters apples, with the remainder cherries, peaches and apricots,” says Farm Bar Owner T.J. Callahan. “The majority of the apples are cider varietals used to produce hard cider, but we also incorporate these into our restaurant dishes.”

The farm also produces three types of raspberries, black currants and horseradish.

While the Lakeview menu is simple and approachable with sandwiches, salads and burgers, the larger Ravenswood site, which opened last November, has more ambitious offerings such as salads, tempura veggies, pan-seared local mushrooms and roasted Savoy cabbage.

“We also source produce from distributors and the CIPM,” notes Callahan.