Iowa Farmer Today
07-21-07
Organic beef gives farmer new start
By Hannah Fletcher, Iowa Farmer Today
AMES -- At a time when many farmers feel they must “get bigger” to survive,
Robert Pridie may have found a way to reverse time and still be a profitable
farmer.
“I have actually gotten smaller and my income has gone up,” says Pridie, a
Northwest Iowa farmer who raises certified organic, grass-fed beef near Akron.
Three years ago, Pridie seeded his entire farm back to grass and discontinued
row-crop production. His pastures have been certified organic since 2005 with
some in transition.
Pridie helped lead a session for beginning and “begin-again” farmers at the
Leopold Center for Sustainable Agriculture’s recent 20th anniversary celebration.
The challenges facing beginning farmers is well known, but entering a niche
market may help some beginning farmers succeed, said Mike Duffy, an Iowa
State University Extension ag economist. He offered tips to beginning farmers
during the session.
Pridie grew up on a Plymouth County farm and slowly purchased land and
livestock to begin farming on his own. He started with 20-head dairy herd in
1995.
He built up his dairy herd until he decided to transition to grass-fed beef.
Again, when he decided to switch to grass-fed, he started small and cautiously.
“I said, ‘Before we start transitioning for the next few years, let’s find a buyer first.’
Now, much of his beef goes to Whole Foods, a fast-growing organic grocery
store chain.
Pridie said his 700-head herd does not begin to meet his buyer’s market demand
for grass-fed beef.
Beginning farmers often lack sufficient start-up funds and access to land. With
proper management, niche markets may offer premiums that help beginners earn
more, while owning and managing less, Duffy noted.
“As a beginning farmer, you need to know what you have, and you have
management skills.
“And, you need to know what you don’t have. You don’t have capital,” said Duffy,
who is also director of ISU’s Beginning Farmer’s Center.
“Look at what you can do with resources that you have.”
Many beginning farmers express concerns about access to land.
Pridie suggested investing in marginal land because it may be more affordable.
Duffy said crop-share renting shares the risk of farming and is a good option for
beginning farmers.
“What you need to worry about is not ownership as much as it is acquiring use,”
he advised.
“What you don’t want to do is to go out and borrow a bunch of money because
there’s this old joke that farmers live poor and die rich.”
Renters need to find willing landlords when attempting niche or value-added ag
enterprises on their land.
“There are a lot of misconception and concerns,” he noted.
“They say, ‘Oh, organic means weeds, I don’t want to do that.’ So, you have to
work with people.”
Also, agreeing on longer leases can help beginning farmers when they work with
lenders.
“Then, the young person can say, ‘I have a five-year lease.’ Then, the lenders will
be more likely to work with them,” Duffy said.
Both presenters agreed livestock is a sound investment for beginners.
“I’m not sure you can do without livestock,” Pridie said.
“It extends your labor out. In corn and soybeans, you’ve got a big period when
you don’t have labor,” said Duffy.
“What is going to be the return to the labor I’m putting in?”
Duffy warned beginning farmers should diversify and research niche markets. He
said it is sometimes hard to get insurance for niche crops so a diversified
enterprise can spread the risk.
But, risk can not be completely avoided, he said.
“If you don’t want risk, don’t go into farming,” Duffy advised.
“They are called niche markets because there aren’t many people in it. You don’t
have the infrastructure that you have with corn and soybeans.”
But, as Pridie noted, that is why farmers in these markets see premiums. He said
he gets a 44 percent premium on his beef.
As demand grows in some specialty markets, there is often room for more
production, Pridie said.