grower, 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
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
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 custom cleaning?
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
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,”
Are your crops the cleanest offered in the market?
Do you grow special varieties that are better for particular
Does your location help or hurt your marketing?
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, NE.
“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”
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 protein content.
“You have to know what traits are important to
the buyers you want to reach,” Penland said. –
||First, let’s get
one thing straight—marketing and selling are two different things.
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, Wis.
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
-- 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
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
“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
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 stuff.”)
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 page:
(Darcy Maulsby is a marketing and communications specialist
who was raised on a farm in west-central Iowa.)