know thy stuff
After organic grain producers have selected the
crops to grow and the range of value-added roles
they are ready to handle, they are ready to begin
talking to potential customers.
Wisconsin-based marketing specialist Prescott
Bergh recommends that when you make your sales
pitch, focus on the problems you can solve. He
urged producers to pay careful attention to their
ability to provide these customer benefits:
of supply. Do you have the volume, or
a network of suppliers, to provide customers with
the amount of product they need?
Do you have a special situation that
makes you the low-price producer?
Can you arrange the logistics for the buyer?
Can you do some of the processing yourself or
partner with a co-op or network? Can you offer
Can you package, label and palletize
your product for the customer?
Do you have enough storage capacity to keep your
product in good condition and allow for delivery?
Can you charge for this?
Does your grain have the highest test weight?
Milling quality? Plumpness? Processed yield? “If
you send prospective customers some samples of
your grain, make sure the samples match the quality
of the grain in your bin. You don’t want
there to be any surprises,” Bergh said.
Are your crops the cleanest offered in the market?
Do you grow special varieties that are better
for particular processing?
Does your location help or hurt your
Do you keep your word? Are you someone that your
customers can count on? – D.M.
sales start with seeds
Many qualities that growers take to the marketplace
relate to proper seed selection, noted Dennis
Penland, the organic product manager for NC+ Organics,
a farmer-owned seed company based in Lincoln,
“Genetic traits, the growing period, agronomic
practices, the timing of harvest and your grain
drying system all affect grain quality. Choosing
the right seed can help you meet buyers’
standards,” said Penland, who offered grain
quality tips at the “Producing Top-Quality
Food-Grade Beans and Grain” presentation.
Companies that process food-grade organic corn
and soybeans, for example, have specific requirements
for the grains’ foreign matter content,
test weight, protein content, seed color and more.
Grain buyers look at many specifications. Physical
characteristics include moisture content, kernel
size and stress cracks. Sanitary traits include
fungi, mycotoxin counts, rodent excrement and
dust. Intrinsic characteristics include milling
yield, hardness, starch content, oil content and
“You have to know what traits are important
to the buyers you want to reach,” Penland
said. – D.M.
First, let’s get one thing straight—marketing and
selling are two different things.
101: Prescott Bergh (left) takes questions
after his presentation at the Upper Midwest Organic
That’s one of the most important distinctions to make
when you raise organic crops, says Prescott Bergh, a Wisconsin-based
organic sales and marketing specialist.
“Calling up the local elevator is not marketing. If
all you want is for the sale to happen without doing the marketing
work, you’ll get what farmers have always gotten—bottom
prices,” Bergh noted during his “Organic Grain
Marketing Options” presentation at the Upper Midwest
Organic Farming Conference in late March. Many of 70 producers
who attended his session raise 100 to 500 acres of organic
grain, including wheat, corn and soybeans.
When Bergh conducted an informal poll at the start of his
talk, participants said they wanted to learn more about marketing
winter wheat, identifying reliable buyers, contracting organic
corn and soybeans, and finding out which small grains are
in highest demand.
Discovering what customers want
Bergh urged producers to start by looking internally. Farmers
should identify their on-farm resources that can help them
to supply what the market wants.
“Marketing is the work you do to determine who your
buyers are, what they want, and how your product will be used.
This will give you enough information to sell your product
successfully,” said Bergh. He serves as the North American
sales and marketing director of CIRANDA (http://www.ciranda.com/),
a global organic food ingredient company based in Hudson,
Bergh reminded producers that marketing is a strategic process
involving a repeated sequence of five steps:
-- Planning. Decide what you are going to
do. Write it down.
-- Pricing. Determine the existing price,
then decide where will you establish your prices.
-- Promoting. Discern how to let potential
buyers know you exist and what you have to offer?
-- Distributing. Decide how you will deliver
your product to customers.
-- Executing. Take action to reach your goals.
“Think of grain marketing as a circle. You come up
with an idea, and you research that idea to find out what’s
going on in the market. Then you plan, take action, evaluate
and refine,” said Bergh, who also produces and markets
pasture-raised beef and pork to consumers and restaurants
in Minnesota’s Twin Cities area.
Research your market
Take the time to understand your product and view it from
the buyer’s standpoint, he added. “What are the
products your grains are going into? If you raise natto soybeans,
have you tasted them? I would go into a Japanese market, buy
some products and see what they are like.”
As part of your background research, also investigate:
-- Where will your product be used? What
nations buy the product, what industries need the product,
and where are the main manufacturers located?
-- Who or what will be the competition? Where
are they located? Does this include other growers, other regions,
other nations, or other products that can be substituted?
-- How is the product usually traded? Is
it a specialty product or a global commodity? On what kind
of scale is the grain traded? Is it shipped in train cars
or in containers? Find out about cleaning, conditioning, milling,
distribution, and other necessary logistical details.
“Check the USDA’s Web site (www.usda.gov)
to see what buyers of a particular crop want,” Bergh
said. “To learn more, use Internet searches, state departments
of agriculture, your personal contacts, local manufacturers,
trade associations and trade shows. Also, follow online publications
like The Economist (www.economist.com)
to keep up with current trends.”
Commodity groups and university food science departments
can be sources of valuable information, Bergh noted.
“Iowa State University has one of the best on-site
tofu manufacturing facilities and soy processing labs around.
If you want to sell to White Wave, talk to Iowa State first
and learn as much as you can about the end product. Also,
think beyond groups like the Minnesota Corn Growers. Think
about the Minnesota Milling Association and the Minnesota
Bakers Association. [These people are] your market, and you
need to understand their needs.”
Remember that pricing in the organic grain market is very
specific to the crop variety you raise. Choosing varieties
with distinct traits is one way to create leverage.
Build your marketing network
During your research, intentionally build your marketing network
with all your food industry contacts. Make sure buyers know
that you are focused on food quality and that you can meet their
needs. “It’s a broader network than most farmers
have had in the past,” Bergh said.
Sort out your research findings to develop your marketing
profile based on your interests, abilities and resources.
What sections of the supply chain do you want to take on yourself?
What skills and resources, like land and capital, do you have
access to? How do you want to add value? Will you do it through
processing, marketing, or storing? Are you going to compete
on the basis of price and volume, or quality and service?”
“Identify which groups in your target market are best
suited to your situation,” Bergh said. “Then prioritize
your prospects. Who is your ideal target customer?”
Pay attention to the laws that regulate your part of the
industry, and ask some basic questions about companies you
want sell to, Bergh said. “The more you know about potential
customers, the better. Check their reputation, trade associations
and company history.
Approach your top potential customers with a variety of cold-selling
techniques, such as phone calls, letters, e-mails, trade shows
and specification sheets, Bergh added. Before you offer to
sell grain, however, lock in on what you can promise to deliver.
(See sidebar: “Grain Grower, know thy
Plan for success
Finally, think creatively about unusual ways to market grain.
“If you raise corn, buy a fryer and sell fresh corn
chips at local county fairs,” Bergh said. “If
you raise wheat, install a small mill in local grocery stores,
or put one in the back of your pickup, and sell bags of freshly-ground
grain at area farmers’ markets or stores.”
While it takes time to understand the differences between
marketing and selling and develop an action plan, the results
are worth the effort, Bergh concluded.
“You make your money—and your ultimate success
in life— through planning. Doing this work is labor
intensive and seems like downtime, but it pays off,”
he said. “Take these general principles and find creative
options for your farm.”
See Iowa State University’s specialty grain marketing
(Darcy Maulsby is a marketing and communications specialist
who was raised on a farm in west-central Iowa.)