JACKSON, Minn. — A small company is in its third sales season, selling old-fashioned corn seeds in a new way.
Mitch Rowe, 37, (rhymes with “now”) is CEO of Sure-Flex Hybrids LLC, a company he started in November 2017. The company is young but expects to sell conventional, off-patent corn genetics to 750 growers this year. Many customers are in the Deep South states — Carolinas, Alabama and Mississippi — but also the Northeast as well as North Dakota, Minnesota, Wisconsin and Michigan.
The company operates out of an old seed production facility built in the 1940s by DeKalb Seed Co. at Jackson, Minn.
Steeped in ag
Rowe grew up on a diversified farm where his family raised corn and soybeans and operated an artificial insemination boar stud business, seven miles south of Jackson. He started college at Minnesota West in Worthington, Minn., where met his wife, Laura. He went on to receive a bachelor’s degree in crop and soil science from the University of Wisconsin-River Falls in 2006. They married that year and today have five children age 13 and younger.
Mitch started his agriculture career as a sales agronomist with a local cooperative, and then worked five years as a production agronomist from Pioneer Hybrids soybean production facility in Jackson. He started his own franchise seed distributorship in 2011.
“I just got tired of making these genetic and trait suppliers a whole bunch of money,” Mitch said. “I figured there had to be another way to offer a product to the farmer and not have the rules and regulations that these trait and genetic suppliers put on us.”
In 2015, Mitch and his brother, Nick Rowe, formed Rowe Enterprises, which remodeled the headquarters for the old DeKalb location. Nick separately started ProAg Engineering, which does livestock feedlots and does concrete and dirt work for them.
Mitch called it Sure-Flex.
The “Sure” is a nod the famous “Lancaster Sure Crop” corn variety, a yellow field dent corn developed in the early 1900s by Isaac Hershey of Lancaster County, Pa. (no connection to Hershey candy company, also founded in the county). Most modern corns can trace their roots to Lancaster Sure Crop. The “Flex” comes from the “flex” ear type, meaning its ears will get larger under a smaller population.
Mitch financed the company through his own resources and loans, until seed sales came around.
In November 2017 he obtained “independent germplasm,” by ordering it from the U.S. patent office in Washington, D.C. The government protects plant patents for 20 years. Mitch doesn’t know exactly where they keep the seed, but the patent office sent packages of 50 kernels for $200 each. Sure-Flex started with eight inbred line packages. (One problem is the 200 kernels are 20 years old, and not all will grow,” he said. In some of the packages, no seeds grew at all.)
“You have a male and a female and you need to get it to a large state to have commercial release of a product,” he said. “You’ve got to go out and de-tassel. It’s intensive and takes a lot of manpower to go through and pull tassels. We run a one-four pattern — one row of males and four of rows female and then one row of male, again.”
The Rowes use machines to remove about 85% of the tassels. The first kind of machine is like a small lawn mower with two blades that cuts the tassel off. The second kind is a “puller” with two bicycle tires that pulls the tassels as they go through.
Finally, they subcontract with SMAK Detasseling Inc. 100 miles away at Le Mars, Iowa. SMAK brings a busload of 30 to 40 high school kids to “go in on foot and clean the rest.” (The kids get $8 to $12 an hour.)
Sure-Flex plants the lines in multiple locations, to get multiple generations, or “spins,” as they’re called in the business. They have used winter nurseries, with some in Florida and Arizona, along with Minnesota. The Rowes produce seed corn on 500 acres and another 200 acres of commercial soybeans around Jackson.
They can complete five or six “spins” in a year.
The 2019 season was the first season where they had something to sell — nine hybrids. Most went to the northern clients in North Dakota, Minnesota and Wisconsin.
Out of the first product lineup, they were mostly 85- to 103-day hybrids. They had only one product at 115 days, which would go to the Deep South. A half-dozen are dual-purpose varieties, good for silage.
Sure-Flex has continued to acquire inbred lines and now has 74 in its system. “Whenever something comes off-patent, we’re grabbing it,” he said. They sold nine hybrids in 2019, 27 hybrids in 2020, and are up to 34 hybrids in 2021.
Today, the company’s product line goes from 78-day to 117-day maturity hybrids. The means they have maturity fit for “most of the (corn) acres in the United States.”
“We continue to make more products every year,” he said. “We’re sitting here operating royalty-free.”
In 2020, Mitch and company decided the best marketing strategy was to “go direct to the farm,” and to avoid “dealers, and anybody else who touches that bag of seed before it gets to the farm.” They sold to 400 customers in 2020 — double what they sold in 2019.
The sales force is Mitch and one other salesman, Tim Thurmer, also from Jackson. The company has 68% grower retention, a figure he expects will improve. The age and size of clients is “all over the board.”
Sure-Flex produces 80,000-kernel bags (about 50 pounds) and 40- to 50-unit bulk bags (roughly 2,200 pounds). They offer standard insecticide and fungicide treatments, but not microbials.
They employ an “e-commerce” mode, where customers order online at a flat price. “That’s $97 direct to the farm,” Mitch said. “That means shipping, all that stuff is included. The only thing the farmer pays is $97.”
“We’re loud and proud about our price,” he said. “It’s $97, and that’s throughout the whole growing season."
He said there are no discount levels for volume or timing. “I would argue we’re one of the few that publishes a price from start-to-finish, and everybody knows where we’re at.”
March is their hottest sales month.
The lack of early-selling discounts means that farmers delay seed purchases two or three months later than for most other companies. “We keep a price, hold it through the growing season, and don’t penalize the guys that don’t want to spend their cash later in the growing season.”
“We’d like to get to where everybody is able to ‘click-and-buy,’” he said. “But we understand that’s pretty unique and there’s going to be a lot of questions.” The company has a toll-free line, 833-300-9797.
Most every customer for the first time calls the 800 number first, and Mitch or a colleague leads them to the website.
There is no minimum shipping amount. They have a couple of 2,000-bag customers, seeding about 5,000 acres.
If customers need to replant corn, Sure-Flex sells it to them at 50% off the retail price ($48.50). GMO varieties are developed for things like drought resistance and corn borers. Mitch said that if it is dry and corn borers come, “They need to spray that to control that issue,” he said. And there is crop insurance.
Deep South appeal
“In 2020, we shipped out to 38 states,” he said. “We have the capacity for 2022 sales season, to produce 500,000 units of seed corn,” he said. That would plant about 1.4 million acres. Right now Sure-Flex orders are averaging 23 to 25 bags per customer. That seeds 60 to 100 acres.
“We have guys planting 10,000 seeds per acre, so they can get 8 acres a bag,” he said.” Then we have guys with 35,000 seeds per acre, so they get 2.3 acres per bag.”
“Obviously this is new,” he said. “We can’t publish a whole bunch of yield data because it never existed before at the level we can make guys feel comfortable. It’s a process where people have tried us on acres and they come back and buy a little bit more every year.”
“One thing we don’t do here is a lot of plot data,” he said. “It’s not because we’re afraid of our product not making guys more money. What I end up finding out when you ask these farmers, they never really believe self-published plot data anyway. What seed company is going to show them(selves) losing? Our approach is, you’ve got to try it for yourself.
“Is the $97 too good to be true? Some cases, they’ll say, ‘Hey, there’s no way you can compete.’ Well give us a try, and we’ll make you a believer once you see it’s competitive and it’s going to make you more money.”
Established genetics companies hold a lot of the genetic cards today. Some dealers are selling non-GMO corn through their pipelines at cheaper prices, but not $97 per bag.
Sure-Flex stays out of head-to-head competition.
“We’re not plot-winners,” Mitch said. “We can give up a few bushels (in yield) and make guys more money at the price we’re at. That’s our marketing stance — we’re here to make you more money.”
According to one study, historical improvements in corn yield suggest a one- to two-bushel per year increase in corn yields, on average, suggesting 20-year old varieties would have a 20- to 40-bushel per acre yield drag.
Mitch said he and his customers are leery of “so-called’ independent test plots, he said.
He said it is “expensive,” to test, and drives up up the cost to our customer, although farmers historically seek plot data in making hybrid/variety selections. Similarly, he is skeptical of university plots, which are promoted as having no hidden agenda other than testing variety performance.
“I don’t know if they truly are independent,” Mitch said, offering no proof. As he talks to an agricultural magazine reporter, he adds: “I even will argue, I don’t know if agricultural media are independent, with the amount of money these guys are pumping into this stuff.”
Sure-Flex deliberately sticks to “conventional” corn — stuff that doesn’t include a genetic modification (GMO), which is a separate kind of patent.
Mitch acknowledges growing non-GMO corn is “hard.”
“I’ll bet 50% of the calls are people asking if we have Roundup (ready) corn. We don’t,” he said. “That takes a segment of the marketplace out of our reach.”
His logic: “In areas where their yields are not 250-bushel (per acre) corn, they don’t need to be spending $300 a bag corn (seed) to get 180 bushel corn (yields),” he said. “That’s where we’ve shined, as a price-effective product.”
He notes farmers can plant Sure-Flex Hybrids almost as cheaply as they could plant soybeans in terms of seed cost per acre.
Some corn improvements — breeding that prevents green snap, for example — do not involve the GMOs for weed control.
“Our take on the industry is that they’ve been so focused much on getting everything to work with genetically modified traits, our argument is we don’t know there’s been a lot of success in just pure natural breeding.”
“I would argue that we’re going back to the way business was done before ‘traits’ came in, of actually having a true source of corn that is not owned by Bayer-Monsanto or Dow-Dupont.”
Mitch said competitors already malign “Sure-Flex” as “cheap corn.”
“The loudest people in social media and putting in negative comments are seed dealers themselves," he said. “We always get a kick out of that.”
There’s 30 million to 35 million bags sold in the United States every year.
“There’s room for everybody," he said. “I would say our biggest factor of why we’ve been successful is the growers want us to win, too. ... I think they treat us a little differently than everybody else.”