FARGO, N.D. - Palindromes Inc. is one of an increasing number of companies working on paying farmers for quality, not just yield, and helping to insulate them from the vagaries of commodity markets and trade wars.
The company's chief executive is Karla Klingner, 41, a lawyer from Columbia, Mo., with a career in political and agribusiness. She incorporated Palindromes in Delaware in the fall of 2017, announced it publicly in May 2018, and is narrowing its headquarters in the Midwest.
Klingner describes her new company as a holding company that is a "project portfolio" involving regional companies - including agricultural crop and livestock genetics - to grow their domestic and global markets based on quality premiums and not just yield. It's "vertical coordination," not "vertical integration," Klingner says.
The name palindrome (meaning words spelled the same forward and backward, like "pop" or "mom") is intended to suggest that she wants to elevate local companies to meet more directly with export and domestic markets needs, with more transparency and beneficial exchange of dollars and products going back and forth.
"We want to make sure we have regional ownership, regional leadership in the areas where we're focused," she says, stopping for an Agweek interview while in North Dakota and Minnesota looking at crops and meeting local partners. Among other things, she met with cooperating seed companies to discuss seed production in 2019 and 2020 crop years.
One of Palindromes' first projects is the process of buying majority interest in and aiding the restructuring of Schillinger Genetics, LLC, of West Des Moines, Iowa. Schillinger is known for non-GMO soybean genetics and has research stations in Iowa and Maryland, and abroad.
John Schillinger has had his own company since 1999. Before that he was the chief executive officer of Asgrow Seed Co., which was acquired as a brand by Monsanto. In his new company, Schillinger has been focused on high-protein non-GMO, high-oleic and low-linoleic soybeans for food and feed markets under the eMerge Genetics and Navita brands.
Schillinger has worked for six years to study soils and develop "natural-resistant traits" for the northern states, claiming not to compromise on yield versus conventional, or even genetically-modified varieties, Klingner says.
On the Schillinger project, Palindromes has been pulling together investments and working out regulatory and tariff issues in the world, including Asia and Europe. Palindromes contracted with local independent seed companies and farmers to put in almost 11,000 acres for soybean seed multiplication in 2018. Those acres are in Indiana, Illinois, Missouri and Arkansas. John Schillinger is managing existing distributors and sub-licensees of the technology and managing 12 research fields in North Dakota and South Dakota.
• Developing and testing in Missouri for high-oleic, low-linoleic feeds for pigs.
• Creating an "investment arm" that works with "regional leaders that want to invest regionally," including the Dakotas and Minnesota.
• Working with regional governmental programs that help producers to participate in regional value-added projects. The intent is for the projects to remain independent and not bought out later by larger companies.
• Seeking public-private partnerships with universities and for licensing and tech transfers to commercialize products from those universities.
• Developing an "agricultural lending arm" to work with producers who now razor-thin profit margins to get them in position to capture more premiums, and have markets that are reliable to better thrive in times of "political and market risk."
• Taking on a port in the lower Mississippi River for a "massive aggregation site for soybean crush and oilseed," with the products that come from the Schillinger genetics.
Klingner has varied agricultural credentials. She grew up on a diversified farm on the Missouri/Iowa line that focused on premium beef genetics. She studied agricultural business at the University of Missouri at Columbia where she obtained a law degree. Klingner was the agricultural and water policy legislative aide for former U.S. Sen. Kit Bond, R-Mo., through the 2007 farm bill and 2007 Water Resource Development Act, as well as the National Food and Agricultural Research bill.
Since then, she worked for a Washington area law firm, then lived in China for several years as a consultant. She traveled the world to study markets before launching Palindromes.
"A lot of my passion comes from an understanding of how to help farmers get through these difficult times, by finding niches that allow them to be a bit more protected from the unprotected markets set by the (Chicago Mercantile Exchange)," Klingner says.
She believes China has positioned itself "quite well" for a current trade war. She says the new farm bill needs to help position farmers to better survive market disruptions by shifting toward value and away from "abundance," or primarily yield.