STARTING SMALL

RHAME, N.D. John Lee Njos has a personal agenda.

He wants to bring more people home to ranch country in western North Dakota. And he's learned the hard way about big beef processing projects.

"I think the biggest thing I've learned is that you've got to start small and build from there," Njos says.

And he should know.

Njos (pronounced NASE), a rancher from Rhame, N.D., is a former leader in 1990s equity drives toward rancher-owned packing companies in North Dakota. He helped convince ranchers to invest millions of dollars toward such projects, but none got off the ground and the money was returned to the farmers.

Today, he's one of a dozen or so ranchers in the state who are working to market their beef through Country Natural Beef Cooperative, which got its start in Oregon and delivers "natural" beef to markets in the Northwest and elsewhere. In January, the Njos family became one of the first North Dakotans to send steers on a trial program to a co-op leased feedlot in Oregon.

In early February, their family his son, Chad, and daughter-in-law, Amanda took the co-op's meat directly to the customers at a Minneapolis food consumer co-op.

"We're looking at it as niche marketing," Njos says. "It's the only company I'm aware of at this size that is owned by the producer all the way through to the retailer and you're paid back accordingly."

Another new way

The Njos family is used to finding new ways. John Lee's ancestors immigrated in the late 1800s and started in eastern South Dakota. Then they went to western Minnesota before transplanting themselves to Harding County, S.D.

Njos, 60, was the eldest of three children. He graduated from high school in 1965 and married Ellen in 1969. She grew up three miles away, and they knew each other from school. They soon bought the ranch where they live, on the edge of the badlands and rolling plains. About 2,000 acres between purchased and leased land, it gets 10 to 12 inches of precipitation on a decent year.

They started with Simmentals, then had Angus-cross, then Angus about 225 cows.

Njos remembers the 1970s market plunges, the 1980s droughts.

"To subsidize a bit through the tough years, I ran an artificial insemination business called Badlands Genetics and had a contract with American Breeders Service.

The Njoses had five children in the 1970s and 1980s Chad, Christa, Angela, Johanna and Ben.

In 1984, Njos served on a soil conservation board when he heard about a weeklong seminar in Bismarck, N.D., where he met Allan Savory, a specialist in "holistic" management of beef grazing. It was about "cell grazing," but also about monitoring grass species and planning grazing.

"We were able to increase cow numbers and lengthen our grazing period. Through the drought, we held our numbers together and improved things," Njos says.

In 1994, Chad came home to the ranch actually to a ranch about 25 miles away, which is practically neighbors in this part of the country. His wife, Amanda, is from Dickinson, N.D. Angela is an accountant in Dickinson, but lives in Rhame and works with the ranch part time. Ben has Down syndrome and is at home.

Parade of projects

In 1995, a group called Northern Plains Premium Beef rose up.

The group started an equity drive, looking to build two plants. Bill Patrie, then with the North Dakota Association of Rural Electric Cooperatives, was interim chief executive officer. Njos was an investor. The effort fell short.

The group was reconstituted for a second drive. Njos then was chairman of the board and kept an office at the Agricultural Research Service lab in Mandan, N.D. The group hired Keith DeHaan of Mandan to help. They polled producers on plant sites and worked with a New Zealand company on a plant for Belle Fourche, S.D. There were two drives first for 250,000 head and second with just North Dakota and South Dakota for 100,000 head. Neither reached its goal, and all money was returned.

"It was a real learning experience," Njos says. "It's quite challenging and can be pretty frustrating."

When the equity drive failed, too, the group dissolved the co-op.

"I think what we did was we started too big, trying to get too many people involved," Njos says. "People need to see things work to be comfortable with them."

Back at the ranchIn 1998, Njos went home. The co-op kept its intellectual property in an entity called Dakota Beef Development Corp.

In 2000, this group, now led by Dick Kjerstad of Wall, S.D., launched another attempt to buy 49 percent of Elkhorn Valley Pack of Dodge, Neb. In 2001, that equity drive failed, too.

"It was a missed opportunity," says Njos, who was vice chairman, noting that the successful group has had good returns.

Individually, members of the group tried marketing natural beef in Wellington, Kan., but when fuel prices increased, that stopped.

There still was another effort to build a New Zealand style packing plant in the Griggs-Steel Empowerment Zone, but feasibility studies later said that would be uneconomical, and the idea was dropped. Through the feasibility study process, however, they became aware of Country Natural Beef Cooperative.

Patrie, with Pat Downs, another NDREC business developer in Fargo, and Neil Doty, a Fargo-based business consultant, helped link the North Dakota growers to these folks. Dwight Bassingthwaite of Sarles, N.D., and Richard Long of Berlin, N.D., also traveled to the area for tours.

Eventually, the group met Doc and Connie Hatfield of Brothers, Ore., who had started small co-op with a dozen ranchers and were marketing beef through small natural foods stores, and eventually with Whole Foods, a large natural foods store chain. The co-op has no formal staff and operates on a consensus.

"They were looking at expanding, coming this direction," Njos says.

The group was into some of the same holistic management practices to which Njos already subscribed.

"They call it 'graze-well principles' and 'low-stress' cattle handling."

Country Natural put on a seminar on the topic in Bismarck. Njos and a handful of other North Dakota rancher talked to them about qualifying. In December 2005, the Hatfields met with prospective producers in Bowman and Mandan and started the relationship.

The Njoses and Don and Sarah Nordby of Amidon, N.D., delivered steers to Country Natural Jan. 2. They were the first North Dakotans to do so. Forty-two head from the Njoses went out in the first bunch. The animals were taken at 800 pounds to a feedlot in Boardman, Ore.

"Eventually as the market increases and the number of producers increase, we'll probably look at doing something as far as a feedlot in this part of the country," Njos says.

"The object of a lot of it is to make the ranch sustainable so you can pass it from generation to generation. You want to produce good-quality food and increase the production of the land. You want to take care of the wildlife and streams.

"You want a healthy product."