CARRINGTON, N.D. — There are rules for commercial feed sales operations, but enforcement requires common sense.
That’s the message from North Dakota Agriculture Commissioner Doug Goehring, after a feedlot operator demanded a cease-and-desist order against a feed supplier.
Cattle feedlot operator Korby Kost of Carrington, N.D., was upset when he learned that Bob Bjornstad, a processor and marketer of pasta waste feed, sold the business to new operators without offering it to Kost.
Instead, he sold it to Ben and Ashley Doeling.
And thereby hangs a tale.
Famed general manager Tim Dodd, from Kansas State University, trained Bjornstad and other “farm boys” to be millers. Soon the Cando plant needed to get rid of “waste” noodle pieces — stuff that “hits the floor” due to normal processing procedures.
Bjornstad bought the “hog feed” and fed it to pigs and calves at his farmstead
In 1993, Dodd moved to Carrington, N.D., to set up the iconic Dakota Growers Pasta Co., initially a farmer-owned cooperative. Dodd recruited Bjornstad to move from Cando.
Soon, Bjornstad started buying that plant’s waste — a tiny fraction of the pasta volume.
In about 2004, Bjornstad bought a shuttered farrow-to-finish hog barn setup near Barlow, about nine miles away. “I used the pasta for the pigs and sold the excess,” he said.
In about 2001, he quit the pasta plant day job. In 2007 he quit the hog operation, although a daughter ran it for another three years.
“That’s when I ended up with a lot of pasta to sell,” he said. In 2013, Bob’s younger brother, Royce, a retired toy manufacturer from Arkansas, moved to a farmstead near Barlow, and helped with the feed business. But in 2020, after seven years, Royce and his wife moved to Missouri to be nearer to relatives.
“I was ready to retire,” Bjornstad said.
The cattle cut
Bjornstad considered Kost a good customer.
Kost used a lot of pasta feed when he was finishing cattle, not so much when he was background-feeding them. Bjornstad guessed the average was about 20% of his market base. The feed source was particularly helpful when corn was selling for $220 a ton in 2013. Bjornstad was selling the feed for $100 a ton at the time, and Kost had confided that the cheap pasta had helped get him through the crunch.
Everybody seemed happy.
But suddenly, Doeling — the new owner — showed up to deliver some of the product. When Bjornstad stopped by the feedlot for a check, Kost angrily told Bjornstad he should have sold the feed enterprise to Kost instead of Doeling.
Bjornstad responded he just “wanted to quit and I sold to somebody who wanted to start,” Bjornstad said. The Doelings would be paying for the business over time. Kost pressed him to find out how much they were paying, and offered Bjornstad a check on the spot.
“He said, ‘I'll buy it from you and they can work for me,’” Bjornstad remembered.
But Bjornstad said it was too late — the deal was done. The Doelings had bought all of his equipment and were renting his buildings.
Then, Kost went to a Dakota Growers Pasta official in charge of selling byproducts.
“I feed a majority of this feed and would rather deal directly with the pasta plant,” he told them. (Bjornstad says it’s about 20%, although occasionally higher.)
He learned Bjornstad was paying about $20 a ton for the product and was selling it to him for $65 per ton to $70 per ton. Kost offered $31 a ton for the feed, but they declined his offer.
Failing that, Kost asked the North Dakota Department of Agriculture for a “cease-and-desist” order against the Doelings, on grounds the Doelings were manufacturing and distributing feed illegally, without a license
Doeling didn’t have a certified scale, Kost complained. They sent him to the Public Service Commission on that. He went to the governor’s office and the news media.
The turmoil was a shock to Doeling, who thought he was simply buying a business and operating it as before. He paid $120 for a two-year license. He made arrangements with a local elevator to run the material over their scale.
Doeling, 36, grew up on a dairy farm near Carrington. After graduating high school in 2003, he started studying accounting at Bismarck State College. Instead, he took an oilfield drilling crew job. He and his wife, Ashley, a pharmacy technician, also from Carrington, lived in Bismarck, with three children, ages 10 months to 13 years.
The couple found a farmstead online in June, owned by Bob’s brother, Royce. They have a few steers and heifers and plan a cow-calf operation. The Doelings made separate deals to buy Royce’s farmstead and Bob’s feed business.
Curiously, Doeling said he’s never actually talked to Kost.
“It was him setting his demands on how things work,” he said. “It’s our product, our business and we’re going to set how we want it, and the value of the product.”
The reports to the state officials started as “ a thorn in the side,” but Doeling said it’s “tough to say” whether Kost will be his customer.
“He wants to talk to everybody but us, treating us like the bad guys, and we haven’t done anything wrong,” he said.
Goehring acknowledges that Doeling’s license timing is not perfect, but adds, “no one thinks the product is ‘questionable,’” he said. “We’re not going to manipulate a situation to give one party or another the ability to purchase a business.”
Bjornstad, Goehring said, has a “right to sell to whomever he wants.”
Connie Van Bedaf, an owner of Van Bedaf Dairy, which buys the feed, said she has been happy with Bjornstad’s feed sales to her dairy.
“I don’t care what he pays at the pasta plant, as long as what we pay is off the corn market,” she said. “It’s cheaper than ground corn.”
“It’s their choice,” she said, of Bjornstad’s selling the business to the Doelings. “Everybody has to make a little money in the end, right? I don’t care if there’s a family down the line that makes a living on it. We can make a phone call and we can have a load of pasta delivered."
Feed supplier laws
Agriculture Commissioner Doug Goehring said Ben Doeling of Carrington, N.D., and his new feed business will get its license, but the complaint about licensure brings up the point that there are requirements for feed businesses.
License — Any business offering feed to the public needs a license. Doeling’s feed enterprise didn’t have one, but it is in the works and on the verge of completion. Bjornstad had operated for years without a license. Doeling's fee was $120 that covers two years.
Insurance —The state doesn’t require either a bond or the company to have liability insurance, but a feed supplier would “probably be smart if they had it,” Goehring said.
Scale — Goehring said that feed outfits (or anyone selling anything by weight) must use a certified scale, approved by the Public Service Commission. Bjornstad didn’t use one, but simply added an “overage,” so the customer wasn’t ever short-changed. Because of Kost’s complaints, Doeling has made arrangements to weigh trucks empty Central City Grain Elevator, and eventually will buy its own scale, Doeling said.
Analysis — The state requires that feed being sold have a feed analysis, with a label filed with the state. Bjornstad had not done that. Kost had never complained or questioned it. “He kept buying it,” he said.