Without cattle, farmers cannot begin to correct the damage to our soils, water and wildlife caused by continuous grain production on hillsides and on thin soils with low organic matter. Cattle are important to regenerative farming because their large size allows them to quickly convert grass to high quality, edible protein – with little or no grain.
This post explains: 1) Why cow-calf producers are essential to modern sustainable agriculture in the Missouri Valley, 2) How urban investors can ensure the survival and expansion of truly regenerative beef and dairy herds, and 3) The Massena Farms business model.
Combining cattle with energy and water-efficient technology and modern crop rotations will enable farmers to produce a wide variety of meat, dairy, grain, fruit and fresh produce, all while rebuilding our soil, water and wildlife resources. Without an effective regenerative business model, millions of acres of marginal land will go out of production when conventional farmers can no longer afford the costs of genetically modified seeds, chemicals and equipment. Please see Grazing Management on Organic Farms for more on regenerative grazing.
Without new money, pasture-based beef and dairy farms cannot compete with the large confinement operations required by conventional banking and investment interests. It is no secret that small farms across country are in trouble. In fact, the USDA classifies most farms with sales of less than $350,000 as financially unstable (2017 USDA). Locally, 40-percent of Iowa’s small cow-calf producers are nearing retirement without succession plans (2014 Iowa State University). In this same study, ISU researchers stated that price competition from row crops prevents small producers from buying and renting pasture to expand their beef herds.
My family and the neighbor who rents our half-section of pasture south of Massena, Iowa are part of the downward spiral of poor cow-calf profits and declining biodiversity. However, the failure the confinement model is only part of the problem.
The direct sales methods used by local growers (farmers markets, CSA’s, food hubs, etc.) have also failed to increase farm profits to levels that can support large scale regenerative agriculture. These is simply no compelling evidence of measurable and sustainable profits among direct sellers as a group.
Massena Farms Business Model
Our model uses an investor-funded, producer-controlled marketing partnership to aggregate cattle for marketing, quality and cost control purposes. Although our ultimate goal is to make grass-fed beef competitive with grain-based confinement feeding, our focus at this point is on consolidating a supply of specialty beef under a single producer-controlled marketing program. We are also in conversation with area cattle feeders and meat packers who are interested in specialty beef. The objective is to improve production efficiencies and avoid unnecessary capital costs.
Step 1: Lower Costs
Our model uses four key ideas to reduce costs:
• Producers as majority shareholders in marketing partnership
• Local investors fund the partnership, vote and share profits
• Professional services delivered through the partnership
• Formal succession plans secure pasture, rangeland and herds
Step 2: Demonstrate a Producer-owned Food Brand
Once we have secured our production base, we intend to ask local investors to help us develop a farmer-owned brand of specialty beef. Depending on the production methods and consumer preferences, these cattle will be raised without GMO’s in their feed and/or without growth hormones and antibiotics. Certified grass-fed organic along with grain and pasture-raised organic are also possibilities.
Given that consumers’ “willingness-to-pay” for various types of specialty beef is unknown, market research will be at the heart of this project. As noted above, we are in the process of organizing cow-calf producers to work in concert with qualified investors, established local cattle feeders and packers. Our goals are to: 1) Produce beef that meets consumers’ requirements for taste, nutrition, animal and environmental care, 2) Set prices so that local supply chains are profitable during the long transition from feeding grain in confinement to 100 percent pasture-raised, 3) Ensure that cow-calf producers control enough pasture and rangeland to support the transitional supply chain, and 4) Require succession plans that pass these critical assets to future generations.
Step3: Other Producer-Owned Brands
The marketing, management and financing concepts outlined here apply to a wide variety of specialty foods that can be produced and processed in the Omaha area. Once we have proven these concepts by demonstrating the beef brand’s profit potential, we intend to organize a new company to develop other farmer-owned food brands. We call this company “Raised Free”.
For more on the concepts outlined here, please go to www.RaisedFree.org and then call me to arrange a meeting with your producer organization or investor group.