New and better ways in ag
Innovation is always important in agriculture. But it's critical when crop and livestock prices are struggling, as they are now. Agweek looks at four area ag companies - one each in Minnesota, Montana, North Dakota and South Dakota - that are using technology, imagination and determination to operate more efficiently and serve customers better.
An adventure in potatoes
GRAND FORKS, N.D. - Black Gold Farms wants consumers to live "redventurously" - a play on eating red potatoes living adventurously. The company, for its part, operates opportunistically and innovatively.
"We like to say we're a growth company," said Leah Halverson Brakke, director of new business development. "And to grow, you have to innovate. You just can't rest on your laurels and do the same thing year after year."
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Her father, Gregg Halverson, is president and chairman of the board. Her brother Eric Halverson is CEO. Her brother John Halverson is chief operations officer.
The fourth-generation, family owned company, based in Grand Forks, N.D., has expanded, both geographically and in its product line, by taking advantage of opportunities. Today, it operates 35,000 acres on 11 farms in 11 states, raising both potatoes and sweet potatoes. Its potatoes go for the chip and table stock, or fresh, markets.
Black Gold Farms has about 200 employees, 35 of them in Grand Forks and about 50 total in North Dakota and Minnesota.
Chip potatoes historically have been the company's "bread and butter," Brakke says. But in 2010, Black Gold Farms moved into sweet potatoes, too.
"A sweet potato grower came to us, and we were looking for a way to expand our base," she says. "It's gone well."
Black Gold Farms operates a sweet potato farm and facility in Louisiana. Most of its sweet potatoes go for sweet potato fries, with some sold at retail.
The expansion into red potatoes helps Black Gold Farms diversify even more, and allows the company to tap into what it thinks is a great opportunity.
"One of my goals is, get consumers to eat more red potatoes," Brakke says. "At the end of the day, that's what I want to do. Red potatoes have such potential to grow market share. For next year, we're trying to elevate the potato category. We want consumers to see how adventurous red potatoes can be."
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'Food enthusiasts'
Red potatoes are a staple in northeast North Dakota, where Black Gold Farms has its headquarters. But they're not as well known elsewhere.
"We have to get accustomed to the idea that red potatoes aren't something a lot of people just naturally look for when they're grocery shopping," Brakke says.
Potatoes USA, the nation's potato marketing organization, has identified "food enthusiasts" as a growing potential market for red potatoes. Black Gold Farms, in turn, is working to sell its reds to those consumers.
One sign of its success: The company's Smoky Chipotle Potato Lettuce Cups were named both Buyers' Choice and Kids' Choice in the Fresh Summit Sensory Experience Contest this fall in Orlando, Fla. Forty-five recipes from companies nationwide were submitted.
In 2017, Black Gold Farms' marketing campaign will include some "crazy recipes and other things that focus on how exciting potatoes can be," Halverson says.
Russet potatoes remain the market share leaders, by far. But reds are inching up, at Russets' expense, Gregg Halverson says.
"When people buy any kind of potato, we're happy," Brakke says. "But if red potato consumption increases, we're even happier. If Black Gold Farms' red potato consumption increases, we're ecstatic."
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After college, Brakke worked in marketing for a number of area organizations.
"Marketing was always kind of my passion. I wanted to do more of that, so I went elsewhere at first (rather than working for the family business)," she says.
Black Gold was one of her clients when she worked for AdFarm, a marketing agency that specializes in agriculture. Six years ago, she returned to her family business to manage its fresh market.
Gregg Halverson says he has eight grandchildren, all girls, some of whom are beginning to get involved in the family business. So, he's optimistic that Black Gold Farms will continue into its fifth generation with them.
The company will remain innovative and opportunistic, he says.
"With innovation, we don't always get it right," he says. "But we're always trying something different, something new, and we always have a little fun doing it."
"And we'll continue to take advantage of opportunities when we find them," he says. "Sometimes, when you're not looking for them, is when they pop up."
Healthy foods, healthy business
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Massoud Kazemzadeh always believed in his product. Now, consumers and supermarkets increasingly share his enthusiasm.
"When we started, the concept was too extraordinary," says Kazemzadeh, founder and CEO of Kay's Naturals. "But now the market has caught up."
His Clara City, Minn.-based company manufactures and markets high-protein, gluten-free snack, cereals and pretzels. Its customers include diabetics, athletes, people trying to lose weight and people looking for healthier options. The Chicago White Sox professional baseball team is among its clients.
One sign of Kay's Naturals growing success: The company was named 2016 Ag Innovator of the Year by the Minnesota Agricultural Research Institute, a nonprofit, largely state-funded institute that finds new and innovative uses for ag products.
"Innovation is the core of what we focus on," says Shannon Schlecht, AURI's executive director. "Kay's - its looking forward at ways to create new uses and new economic opportunities - is really the bread and butter of that."
AURI first became involved with Kay's Natural when the company was founded in 1996.
Kazemzadeh received his doctorate in food science from Texas A&M University, then moved with his wife, Linda, and their young family to Minneapolis. He worked there with several big companies in developing new snacks and cereals.
As his career progressed, Kazemzadeh became more interested in providing healthy snacks, especially because Linda was a juvenile diabetic. She died in 1997.
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Shortly before her death, "She came to me and said, 'There's nothing for diabetics. If you're such hot stuff, what don't you come up with something?'" Kazemzadeh says. That influenced used him to start his company.
"My last name is fairly lengthy, so people call me Kay," Kazemzadeh says, which helps to explain the company's name.
The company went through several structural and ownership changes in its early years, struggling in part because supermarkets didn't have a section in which to display and sell its products. But that's changed in the past few years, as many stores have expanded their nutritional sections, allowing the company to really hit its stride, he says.
Its products are now sold at 9,200 stores nationwide. The list includes Walgreen's, HEB, SuperValu and Albertsons.
Kazemzadeh remarried Ann Jones, an attorney from Texas, who took an active role in the company, especially in marketing. After they launched their first product, Protein Chips, in 2009, they discovered that diabetics weren't the only ones looking for high-protein, low-carbohydrate snacks: athletes, body-builders and people who had weight-loss surgery were, too.
So, Kazemzadeh developed new products. Today, Kay's Naturals sells a dozen products - three cereals, four snacks, three pretzels and two cookies - and Kazemzadeh hopes to bring even more to market.
Minnesota base
Clara City, a town of about 1,400 in southwestern Minnesota, has provided financial assistance to Kay's Naturals, and the company is happy there and intends to stay there, Kazemzadeh says.
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The company has 32 employees and plans to add three or four more, he says.
Kay's consists of two arms: Kay's Natural, the brand, and Kay's Processing, the manufacturer. In 2016, Kay's Naturals will have sales of $5 million, while Kay's Processing will have sales of $4 million, Kazemzadeh says.
He's optimistic the company will continue to do well.
"We most likely will grow pretty fast," he says.
New spin on old product
Sheep-to-shelf, value-added, innovation - whatever you call it, the Duckworth wool clothing in Dillon, Mont., is doing it.
Duckworth markets high-end Montana source-verified wool, from Rambouillet sheep raised in the mountains of Montana, primarily to the "urban contemporary market that's slightly into fashion," says Evan Helle, Duckworth's production manager and son of the company's co-founder, rancher John Helle.
Its product range from socks and accessories to wool-insulated jackets and knitwear, with prices ranging from $20 to $250.
Duckworth uses technology, marketing and more to transform wool, one of the world's oldest commodities, into products that appeal to consumers concerned about local sourcing and sustainability.
That ties into value-added agriculture, or taking a raw agricultural commodity and converting it into a more valuable processed product. Value-added is the shared goal of virtually everyone involved in U.S. production agriculture.
Duckworth also is a prime of example of so-called sheep-to-shelf, also known as sheep-to-shop - or shortening the supply chain from where sheep are raised to where wool products are sold. The practice is touted by some as giving consumers more knowledge of, and control over, where their products come from. In contrast, many wool products sold in the U.S. come from wool raised in Australia or New Zealand and knitted in Southeast Asia.
Duckworth products are manufactured in U.S. factories, Evan Helle says.
He identifies the company's most likely customer as "an educated consumer who's looking for something out of the ordinary - but not so hidden of where it comes from. (A consumer) who likes to know where it comes from, and the environmental impact it has."
Until recently, sheep and their wool have played an increasingly smaller role in American life. U.S. sheep numbers, which peaked at 56 million in 1945, now stand at about 5.2 million. Montana has about 220,000 sheep, roughly 4 percent of the national total.
U.S. shorn wool production has dropped about 75 percent since 1976, reflecting, among other things, greater competition from synthetic fibers. But there are promising signs that some consumers are returning to wool, in part because the U.S. sheep and wool industry is stressing the quality and sustainability of its product.
'On a chair lift'
Evan Helle, a fourth-generation rancher, says his family has been raising sheep in the Dillon area since the 1930s. Innovation has always been important to the operation, but the family took things to a new level in 2013.
That's when Robert "Bernie" Bernthal, a veteran of the wool and outdoor gear industries, met John Helle when the latter, an avid skier, was skiing on Maverick Mountain near Dillon.
"They hatched the whole idea on a chair lift," Evan Helle says.
John Helle and Bernthal later brought wool textile expert Graham Stewart and John Edwards, who owns an outdoor retail shop in Bozeman, Mont., into the business.
In 2014, the company hired Evan Helle, a recent graduate of Montana State University with a degree in agricultural economics, and launched several products. Good reviews in several specialty publications led to several more products and additional growth.
Today, the company has eight office employees and hundreds more at the 10 factories that make its products. It shears about 10,000 sheep every spring, relying on seasonal and contract employees to do so.
Evan Helle says his family ranch is "known in the sheep industry for pushing the limits of technology." That includes using an optical fiber diameter analyzer. As he explains it, "When we shear our sheep, we take a little sample before we mix it in with any other wool." The sample is scanned by a laser, with the scan results put into a computer program. The program provides statistics that allow Duckworth to sort the wool based on the quality of the fleece.
"It gives us a level of control," Helle says. "We can select a specific line of wool for the end use."
Wool is considered too itchy by some potential customers, something Duckworth has worked hard to address, he says.
"We track the genetics of every single sheep," Helle says. "We track the characteristics for lambing, the characteristics for wool and the characteristics for production. We can track and control, make a wool fiber that doesn't itch anymore."
His advice for other people in ag who want to innovate, diversify and add value:
"Identify the exact consumer you're trying to sell to. Identify how many of them are in your area and have access to your product," he says. Doing so "gives you a very clear idea of what you should be selling and how you should expect to sell."
Innovative SD farm couple engage with consumers
Brad and Peggy Greenway excel at raising pigs, in part because they're always looking for ways to innovate and get better.
The Mitchell, S.D., farm couple is good at telling their story to the public, too.
"Our ultimate goal is animal care and safe food," Brad says. "But when you talk about sustainability, you have to consider making enough money to stay in business, too. That's part of it, and the public needs to hear it."
Peggy and Brad, who this fall was named 2016 National Pig Farmer of the Year, own two wean-to-finish pig barns. They also raise beef cattle and grow corn, soybeans, wheat and alfalfa.
Peggy grew up in a St. Paul, Minn., suburb. She and Brad met in college, and later married and began farming together in 1983. They borrowed money, at 19 percent, to buy a trailer house.
"We had meager beginnings like a lot of farmers (who started) back in the early 1980s," says Peggy. "We've worked to grow the farm."
She's always helped out on the farm. Until three years ago, she also worked full time in town as an investment assistant at brokerage firms to earn extra income and secure health insurance.
Brad has farmed all his life. He and Peggy now live just a mile from the farm where he grew up. For years, they had beef cattle, dairy cattle and pigs. They got out of dairy 15 years ago.
Nine years ago, they expanded their hog operation. They needed to get bigger, while also using less labor, to become more efficient. They did it, in part, by building a 2,400-pig wean-to-finish barn, which takes a 13-pound baby big and builds it to market weight. Three years ago, they built a second 2,400-pig wean-to-finish barn.
Now, between the two barns, they always have 4,800 pigs on the farm, and sell about 10,000 per year, about six times more than before they built the first one.
The two computer-controlled, completely automated barns provide consistent climate, always-fresh air, always-available food and water, and allows manure to fall through the slatted floor into a containment area under the building. The barns allows Brad and Peggy to concentrate on animal care, they say.
The Greenways have been innovative in other ways, too. They built an on-site computerized feed mill. They're also among 14 people who bought stock in the Bluestem Family Farm farrowing facility, which provides the baby pigs they build up in the wean-to-finish barns.
Brad and Peggy have concrete evidence of how their operation has become more efficient. His dad, Tom, maintained a finishing hoop barn for eight years after Brad and Peggy built their first confinement barn. According to information from the computerized feed mill, pigs in the confinement barn required two pounds less of corn, soybean meal and distiller's grain than pigs in the finishing hoop barn, a savings of $20 to $25.
The Greenways' farm produces enough manure to fertilize their corn, and, in turn, they raise enough corn to feed their hogs and cattle. They have about 220 cows and calves, which they background and sell in February.
Family, public
Peggy works to educate the public on farm issues with several groups, including Common Ground, which connects female farmers with consumers.
Brad talks often to the public about modern agriculture, too.
"The more you do it, the more you realize how important it is," he says.
Family plays a huge role in their lives.
Tom, 84, continues to farm. He worked his cattle the day before Brad and Peggy talked with Agweek.
Both Brad and Peggy's grown children - their son is an engineer, their daughter is a doctor - have returned to the Mitchell area to live and work.
Brad's nephew, Chad, who grow up on a farm just five miles from Brad and Peggy's farmstead , has made his mark playing football for the Minnesota Vikings.
When Chad was young, "We used to work cows and catch calves. I could outdo him. I wouldn't like to try it now," Brad says. "Just a good kid. We're very proud of him."
Their employee, Thomas, who began working for Brad and Peggy about nine years ago, is a key part of the farm.
"He was a young fella, a farm kid, looking for some part-time work," Brad says. "He's been full time for the past six years."
Thomas, who is married, reflects the importance of bringing the next generation into farming, Brad says.
"Sustainability in agriculture gets talked about so much today," he says. "But sustainability needs to include that next generation."
