'Mr. Garbanzo' moves forward

RICHARDTON, N.D. - Ambrose Hoff likes new challenges.

"We don't do anything that's not 'different' around here," Hoff says, repeating a mantra that's served his farming and business career.

Hoff, 56, and his family own Stone Mill Inc., a seed cleaning business in Richardton, N.D. The company is most known for its garbanzo bean (chickpea) and flaxseed business, but also is in the safflower other specialty crops.

Hoff also is one of the founding owners of Amber Waves, Inc., a bin manufacturing company that he created when another manufacturer closed shop in 2002, creating a huge hole community's economic picture.

And that's not all. He was a leader in the hulless barley industry. He was founding chairman of the board of Red Trail Energy, which was the first 50 million-gallon plant in the state, and the first to be built, and one of the biggest outside the Corn Belt.

And he's a farmer, managing 7,500 acres and producing small grains, cattle and specialty grains.

His own interests provide jobs and careers for some 30 people in the community. The ethanol plant provides another 42.

Hoff is a third-generation farmer in the Richardton area.

He graduated from high school in 1970 and decided to do something different. He went to Alabama to study to be a "pattern maker," essentially making plans into wood molds for aluminum castings that are used for pouring steel.

"I had an uncle who lived down there and ran a steel mill," he says. "There were only two schools in the states that taught that at the time."

But Hoff didn't take to the South.

In 1971, he returned to the farm and to Charlotte Hauck, his high school sweetheart. He farmed for a year with his dad, and then the couple went on their own and started their family, which eventually included four children.

In 1978, they sold their cattle and farm machinery and put their equity into Hoff Machine and Welding, making bale carriers and then oilfield equipment. They felt fortunate at the time because farming was about to turn sour with land deflation and the farm credit crunches.

In 1979, the family started a sort of convenience store for farm parts, as a local implement closed. In 1983, they tiptoed back into farming, even as their machine business boomed with the oil boom.

"It was good times back then," Hoff recalls.

In 1986, the oil boom turned to a bust.

"They caught us in the middle of that," Hoff says.

Oil field companies were on a 90-day credit program and didn't pay. Big trenchers, backhoes and other equipment that Hoff rented out, all came back. Loan interest rates were running up to 22 percent.

"We had to sell down and start over," Hoff says. "We refused to do bankruptcy, even though we were $200,000 to the negative. Over the next seven years, we paid our debts and advanced our business."

Adversity, opportunity

In 1987, the couple had started a seed processing business.

Looking for a new opportunity, Ambrose had gone to California to find garbanzo bean seed.

"Garbanzo seed was worth a dollar a pound, and a neighbor and I thought it would fit here," Hoff says.

But the first crop in 1986 was full of cockleburs that had to be cleaned. Bad luck.

"We started cleaning them by hand because the seed was so valuable," Hoff recalls.

The Hoffs soon bought a seed cleaning machine - a high-tech machine from Denmark - for the 1987 crop. Soon, he was cleaning seed for other people. He had Vermeer's agricultural line for North Dakota, but also got the company's industrial line.

He coined the name Stone Mill Inc. for the cleaning business (named for his farm and windmills, which he loves).

Other farmers grew the garbanzo beans and, soon the Hoffs were brokering seed and selling to canneries. Some media wags dubbed him the "garbanzo bean king."

Also in 1987, there was excessive late season rains and the safflower crop came up with sprouts in the head. The Hoffs' machine was able to separate out the good and bad kernels.

"We cleaned millions of pounds of safflower that winter," Hoff says.

Two years later, there was barley in the wheat. Bad news. It was more business for the cleaner.

Hoff says the 1988 drought was a bad thing for his farming, but the government disaster payments helped keep the farming going.

They had 50 sows and Charlotte raised pigs, feeding them screenings from the seed plant. She drove school bus, and in the daytime, worked on bookkeeping for the businesss.

"That's how we made a living so we could eat and feed our four kids," Charlotte says.

Also in the early 1990s, the company dealt in safflower, moving it into the nonoleic market for birdseed.

"We just kept our nose to the grindstone and expanded the business," Hoff says. "The farming helped us work our way out of debt.

"It was a bad time," Hoff recalls. "You couldn't borrow a dollar at the time."

The garbanzo program wasn't without problems. In the late 1990s, diseases came and totally wiped out the bean business. Five years later, new varieties allowed a re-introduction of garbanzos, and now they are back bigger than ever.

The garbanzo bean business continued to grow. Much of that was shipped to places such as Turkey, India and Afghanistan.

When Sept. 11 hit in 2001, the Hoffs faced another huge challenge.

"We had 3 million pounds in a warehouse scheduled for overseas delivery, and they shut us off," Hoff says. "We were stopped again, big time. We had to switch horses and get creative.

"A couple of weeks after that, we started cleaning flax for food."

Flax was hard to clean, and the Hoffs already were known for cleaning it.

"It took us four years to sell those garbanzo beans," Charlotte says.

Fortunately, growers held some of the beans on their own farms, so everyone helped share the burden with the Sept. 11 disaster.

The Hoff children had had gone off to school and some came back to the operation. Daneen (Hoff) Dressler returned to Richardton in 2002. She got into the brokerage part of the business and lined up some large companies as flax customers. Some of the flax is sent out in containers, loaded at a dock in Richardoton.

Amber wave

In 2002, Hoff took on another challenge.

Richardton Manufacturing, a local company making silage dump wagons, had been sold and was closing. It put 50 people out of work and was a blow to the small town of Richardton.

Hoff went to the auction sale in October 2001 and talked to the real estate broker about what it would cost to buy the building. He then talked to brother-in-law Gerald Hauck, nephew Doug Hauck and his own son, Jody. Doug an electrical engineer, was working in Fargo, N.D. Jody was working for Fagen Inc., a Granite Falls company that builds ethanol plants.

Hoff told them he had noticed a kind of monopoly in the grain hopper tank manufacturing business and thought there might be an opportunity for a new competitor.

"They all thought it was a great idea," Hoff recalls.

Together, they four decided to make a verbal offer on the empty building.

"Within hours, they took us up on it," Hoff recalls. "We stood there and said, 'now what do we do?'"

So in 2002, they started Amber Waves Inc. and hired back some of the work force started making grain tanks, a business that has been growing steadily. In 2004, they added an electronics enterprise, which manufacturers circuit boards and some complete components.

And yes, they've been involved in the new petroleum oil boom, last year starting manufacturing oilfield tanks.

"In the meantime, this Stone Mill business is growing to the point where we're working day and night," Hoff says.

Flax is become a health food phenomenon.

Flax is used for roasting and grinding, and is a health supplement, promoted for its cholesterol-lowering ability, improvement in skin appearance and immunity. About 40 percent of the company's flax goes for the organic market.

Human food must be cleaned to the 99.99 percent purity level.

Flax for the dogfood market must be a mere 99.5 percent pure. And there isn't much difference in price, the Hoffs say. Most major dog food manufacturers using it.

Flax is becoming more popular in the cattle feed market, and Stone Mill has been approved in several niche markets - seed certified, organic, kosher.

And then there was ethanol.

Ethanol dreams

Hoff says it was almost four years ago to the day that he'd been standing by a corn field, talking to Mark Erickson, then a corn seed marketer from Scranton, N.D., talking to him about the possibility of building an ethanol plant.

"Can it even be done?" Hoff says they asked each other.

They went through the basics - water, roads, railroad, natural gas.

"You need corn. The one thing we didn't have was corn. Then we thought, 'let's think outside the box.'"

They decided that ethanol plants in Minnesota were shipping out 65 percent moisture distiller's grains, or paying to dry it.

"We found out the railroad shipped 380 million bushels of corn right by us every year to the Pacific Northwest," Hoff says. "We thought, let's put a switch in the track, with 110-car loading, and we can buy all the corn we want."

The rest is history.

There were grants from local economic development sources, state sources, and then an investment of $1.2 million from a group of 19 people, including Hoff and Erickson. They raised $25 million over a year's time and construction was completed late last year. Production started in January.

On the ethanol project, it was a challenge to secure Fagen as a builder. It probably helped that Jody had worked with the company. Richardton became one of three coal-fired plants in the nation, but was edged out by two Iowa plants in its timetable.

After the construction began, Hoff and his board had a new challenge - evaluating offers from other companies to buy the place after only a brief period of production.

"Rumors got out that we were dealing with somebody," Hoff says. "At the end of the day, it turned out they didn't come across. It was no sale."

Hoff rotated off the board in May, but his son, Jody is still on the board.

While Hoff isn't sure what's coming next, he knows that something new will. He's working on a personal goal to create 100 jobs for Richardton and the immediate area, and he's well on the way to seeing it.

"Basically, learn from your mistakes and think outside the box to come up with new and keep moving forward," Hoff says. "You have two options in life: You can quit or you can move forward. We just chose to move forward."