For farmers transitioning from conventional to organic production,
the switch is perhaps made easier by the lure of eager markets and
premium prices. But while such markets and prices do exist, physically
reaching them can often be a challenge.
Proximity certainly did matter for Curt Petrich of Crookston, Minn.
Premium markets were hundreds of miles away from the northwestern
corner of the state where Petrich farms. He was beginning to weary
of long-distance drives hauling crops to the Twin Cities area when
he heard about a seed processing plant that was a mere hour away,
in Moorhead, Minn.
Petrich asked around, and uncovered three intriguing bits of information.
First, he learned that the plant was well equipped to handle organic
grain, and in fact had been processing some organic product. Second,
he was told that the facility currently belonged to Anheuser-Busch—the
company had been hoping to process special variety of barley there.
And third, Anheuser-Busch's plans had changed, and the facility
was now for sale.
“I’d heard that Monsanto and Cargill were interested
in this place,” Petrich said. He relished the idea of trying
a bit of vertical integration and keeping the building out of the
hands of the big guys. In an emerging business like organic farming,
Petrich saw wisdom in holding on to a bigger segment of the added-value
Plus, there were some specific features of the plant that Petrich
felt were very appealing. “What attracted me almost immediately
was the fact that this place was built to keep identity intact,”
says Petrich. Identity, he knew, was often a key to successful overseas
marketing. Asian and European customers, in particular, will pay
to be certain they are getting a specific variety—and only
that variety. They do not want any interloping seeds or grains,
or variations in quality. This can be especially true of a commodity
that is certified organic or non-GMO.
All of this convinced Petrich that he should set out on a new adventure
and seriously pursue ownership of this unique site and the opportunities
that it presented. Yet he knew he couldn’t go this alone: He
would need partners to help carry the financial and administrative
Petrich approached five of his farming neighbors with the idea
of a joint purchase. Together, he suggested, they could own a business
to market their organic products and capture a slightly larger piece
of the profit margin. Their reaction was not initially positive,
notes Petrich. “They all said, ‘You want to do what?
And they want how much?’”
But slowly and surely, the concept grew on the group. Of the six
(counting Petrich), five were organic. According to Robin Brekken,
also of Crookston, they all faced the same challenges regarding
marketing. “I remember thinking, ‘Okay, I’m organic.
Now what?’ All the old markets and marketplaces were of little
The costs of shipping, including the time spent managing that aspect
of the farming business, were a new concern for these producers,
many of whom had only recently transitioned into organic production.
This business could address that. “As we looked at the efficiencies
we could create, we suddenly saw the value of this venture,”
Before they approached a banker, the group hired a consultant who
could assist them in determining if this was a feasible business
idea. The consultant studied market demand, plant capacity and debt
serviceability. He also helped set up a model cash flow to assess
whether the idea could sustain itself. Eventually, the group put
together adequate equity to secure a loan, and financing was obtained
through a local lender.
“I made Anheuser-Busch an offer—I told them I’d
give them their asking price in cash,” notes Petrich. “That
got their attention.”
Preserved identity processing and handling
Petrich is now manager of the aptly named Earthwise Processors,
LLC. “All processing here is segregated,” he explains.
This means that only one type of seed grain is processed at a time.
To make that guarantee, careful cleaning is required between loads.
Generally, an entire day or more is dedicated to the preparation
of a product for sale. Cleaning alone can take up to eight hours,
and is often completed in the evenings to prepare for the next incoming
crop. Even the truck bay must be carefully swept and blown out with
pressurized air if a batch of organically produced grain follows
one that has been raised by conventional methods.
“What we offer is a specific variety, of specific size and
specific quality, packaged and delivered to a specific location,”
says Petrich. Earthwise customers can call up and make a request,
and the staff will do whatever they can to find and purchase that
product. Usually farmers deliver their crops to the facility, but
if needed, Earthwise can pick up from the farm site. Earthwise currently
processes soybeans, wheat, corn, millet, safflower, sunflower, flax,
barley, peas, canola, edible beans, oats and popcorn, among other
grains and seeds.
This care in handling is in large part why Earthwise can expect
a premium price for the commodities it processes. Fifteen employees
run the plant’s equipment and complete the cleaning and sorting
of the crops received there. Products are carefully cleaned and
sorted by custom machinery designed to meet customer specifications,
An air screen and destoner remove any foreign materials from the
seeds and grains. Gravity tables are used to separate the product
by weight. Another roller/separator segregates soybeans by shape.
Again, the expense of all of this is justified by the selling price,
says Petrich. Earthwise’s clientele expect no less.
After the initial preparation, products are packaged according
clients' needs, in paper or plastic, and in quantities ranging from
25 lb up to 2,000 lb. Products can be also be shipped in bulk using
containers, trucks or railcars. Grains and seeds can also be stored
on site, if needed. Earthwise Processors operates two warehouses
that total 35,000 sq. ft. In addition, the site has 40 storage bins
with a total capacity of 400,000 bushels.
Expanding markets, at home and abroad
Earthwise's buyers are far more exacting than the domestic market
generally, notes Petrich. In order to provide the greatest possible
transparency, Earthwise is certified through the American Institute
of Bakers (AIB). All product is tested once when it enters the plant,
and again after processing to verify precisely what is being received
from farmers and to certify that clients are getting exactly what
they have ordered. When truckloads of a product leave the plant,
Petrich notes, the truck is sealed at the point of departure. Clients
also receive a photo of the product as it departs from Earthwise,
to give them a point of reference in the event damage occurs during
The AIB certification is an outward verification of the promise
Earthwise makes to its customers. Earthwise also holds certifications
from Quality Assurance International (QAI) and Farm Verified Organic
(FVO), and they are in the process of establishing Hazard Analysis
and Critical Control Point (HAACP) procedures.
This year, Earthwise will celebrate its fourth anniversary. Petrich
is reluctant to declare the business a complete success, but growth
thus far has been dramatic.
Petrich, who also serves as president of Earthwise, notes that
300 farmers bring their goods to this outlet. He estimates that
the original six owners sell 80 percent of their total crop production
through the facility.
The doors that have been opened and the opportunities created have
certainly put demands on the time of the owners. Yet they all feel
the business has been a marketing asset. “We sell to Japan,
to Korea—but we also sell domestically, right next door,”
The next phase may involve some further processing for the products
Earthwise handles. Petrich knows his adventure in organic production
is just beginning. “I wouldn’t be here as a farmer if
I hadn’t switched to organic,” he states. He’s
hopeful that the doors opened by Earthwise Processors, LLC, will
multiply, bringing opportunities to organic farmers across the region.