Processors

Processors of agricultural and food products.

Associated Challenges:

Market Access and Promotion	Smaller producers struggle to access international markets due to limited promotion and branding efforts. Expanding the promotion of Hawaii’s premium agricultural products and establishing unified marketing strategies is seen as a priority.
Permitting Delays	Lengthy permitting processes, particularly for infrastructure projects like cold storage and processing facilities, delay necessary investments. Producers face significant challenges navigating Hawaii’s regulatory and permitting framework.
High Energy Costs	Processing facilities, especially for energy-intensive processes like drying and roasting, face high energy costs. These costs impact profitability for macadamia nut and coffee producers, prompting interest in renewable energy solutions.
Cold Chain Management	Maintaining the cold chain is critical for export commodities like flowers, fruits, and seafood. The absence of adequate refrigerated facilities and inefficient cold chain logistics leads to higher post-harvest losses and reduced quality.
Limited Processing Infrastructure	There is a lack of local processing facilities for export crops, forcing producers to rely on off-island processing, which increases costs and risks. Investments in local processing facilities for macadamia nuts and coffee are essential.
Logistical Inefficiencies	Inefficient distribution networks and a lack of cold storage facilities increase the risk of product spoilage during transportation. These inefficiencies disproportionately affect perishable products, such as tropical flowers and seafood.
Complex Food Safety Compliance	Small farmers face difficulties complying with the Food Safety Modernization Act (FSMA) and other food safety standards. The cost and complexity of compliance prevent many from accessing certain markets and limit their ability to scale.
Lack of Available Data and Market Information	Insufficient access to reliable market data and demand information constrains decision-making for both producers and buyers. This results in inefficiencies in pricing, production volumes, and market opportunities.
High Transaction Costs for Small Farms	The lack of aggregation infrastructure leads to high transaction costs for buyers and processors when dealing with small farms, reducing the incentive to source from local smallholders.
Limited Cold Chain Capacity	Inadequate cold storage and distribution infrastructure for perishables (especially fruits and vegetables) result in post-harvest loss, lower quality produce, and missed opportunities in high-value markets.
Inadequate Aggregation and Processing Facilities	Hawaiʻi Island lacks sufficient aggregation and processing facilities, making it difficult for small-scale farmers to reach markets efficiently and profitably. This infrastructure gap exacerbates post-harvest loss and limits access to markets.
Misalignment of Supply and Demand	There is a frequent misalignment between farm production and market demand. Poor demand forecasting and issues with harvest timing lead to inefficiencies, resulting in food waste and revenue losses for small-scale producers.

Processors play a vital role in transforming raw agricultural products into market-ready goods. On Hawai'i Island, processing infrastructure is limited, and many small-scale producers struggle to access affordable facilities. The cost of building and maintaining processing infrastructure, including facilities for canning, drying, or packaging, is prohibitive for many farmers. Most stakeholders feel there is a clear need for greater investment in shared processing centers to support small producers.

Staple Food Commodities

Processing is a significant bottleneck for staple food producers. With limited facilities on Hawai'i Island, many farmers are forced to ship their products to other islands or the mainland for processing, which increases costs and reduces profit margins. Small-scale producers, in particular, lack access to the necessary equipment and expertise to add value to their products. Investment in shared-use processing centers and mobile processing units could help alleviate these issues and enable producers to create more market-ready goods locally. Additionally, increasing training programs for value-added product development could expand opportunities for local producers in the staple food sector.

Export Commodities

For export commodities like coffee, macadamia nuts, and tropical flowers, processors face high energy costs and significant challenges in maintaining product quality. Hawai'i Island's geographic isolation adds to these costs, as many producers must rely on off-island processing facilities. There is growing interest in developing more localized processing infrastructure, particularly for high-value crops like coffee and macadamia nuts, to improve efficiency and retain more of the value chain within the island. Renewable energy solutions, such as solar-powered drying systems, are being explored as a way to reduce the costs of processing export commodities and enhance sustainability.