Offutt's former SD farm goes all-organic for General Mills
FT. PIERRE, S.D. — A 34,000-acre grain farm west of Pierre, S.D., that last year was controlled by RDO Farms of Fargo will be converted to an organic farm under new ownership and management.
General Mills of Minneapolis on March 6 announced a "strategic sourcing agreement" with Gunsmoke Farms LLC, to convert the farm to organic by the year 2020. It will grow certified organic wheat and other rotational crops, according to a news release.
"General Mills will use wheat grown on the farm to make Annie's pasta products, including its signature Mac and Cheese," the release said.
Anne Struthers, director of communications for R.D. Offutt Farms, as well as R.D. Offutt Company and Threemile Canyon Farms, confirmed that a sales agreement on the company's Gunsmoke Farms that was dated May 8, 2017, was completed in September 2017. Gunsmoke Farms formerly was a doing-business-as arrangement in the Offutt operation.
Gunsmoke Farms LLC now is its own corporate entity. The farm is actually a joint venture between TPG Capital (originally an abbreviation for Texas Pacific Group), a private equity company based in San Francisco and Fort Worth, Texas, and Colvin & Co., an agricultural investment management firm primarily focused on farmland.
Colvin & Co.
Colvin & Co., a privately-held company in Minneapolis, is an agriculture-focused asset manager that makes investments into farmland and other agricultural assets for individuals and institutions. It "owns and operates over 50,000 acres of organic and conventional row crop farmland across the United States," according to its website.
T. Marc Schober, a director for Colvin & Co., says the company is in its tenth year and also has offices in New York and Florida. Schober said his company is "in the process of building our 'ops' team," for the Gunsmoke Farms.
Schober's family has owned and managed farmland in Wisconsin for 45 years. He is the head of the company's Minneapolis office and "leads the management" of Gunsmoke Farms, according to his LinkedIn profile. He holds a masters in business administration from The Carlson School of Management at the University of Minnesota. He is the editor of Farmland Forecast and is a co-author of the Investor's Guide to Farmland and Commodity Investing and Trading.
Schober declined to specify which crops will be grown, except to say that the program will involve cover crops.
"We're still fine-tuning the rotation," he said. "It's not going to be a monoculture."
Andrew Fairbairn, who works with Colvin in various locations, is located at the Pierre farm and is working as the company develops.
"We have some of the (farming) players established, but we are still seeking additional support," Schober said. He declined to say whether the company will continue with custom harvesting arrangements that may have been in place with R.D. Offutt Farms. He said custom harvesting is not always a good fit with organic.
A first for GM
"Investing in such a big acreage transition is a first of its kind for General Mills and is another step in growing our organic supply chain," said John Church, chief supply chain officer at General Mills, in the news release. "We continue to seek ways to partner with landowners to make organic ingredients more accessible for existing and innovative new foods that our consumers have grown to expect."
In 2016, General Mills announced a similar transition agreement with Organic Valley, the largest organic cooperative in the U.S., to help dairy farms convert to organic dairy production.
As part of the agreement, General Mills has partnered with Midwestern BioAg to provide "on-the-ground mentorship" for the farm operators to advance leading regenerative soil management practices such as no-till, crop rotation and cover cropping.
General Mills also plans to add 3,000 acres of "pollinator habitat" in cooperation with the Xerces Society. The habitat also will improve water quality, reduce soil erosion and protect game and songbirds.
"We recognize that agriculture practices contribute to some of today's most pressing sustainability challenges, and we are hopeful that regenerative agriculture practices can provide large-scale solutions for restoring healthy soil and a healthy ecosystem," said Carla Vernón, president of the Annie's operating unit. "Our brands like Annie's, Cascadian Farm and Epic are committed to improving soil health by supporting farmers to adopt and advance regenerative farming practices. Together with growers, we want to revive our ecosystems, reduce levels of global greenhouse gases, and produce food to sustain a growing population for generations to come."
Midwest BioAg will also offer on-farm, skills-based learning programs, which will serve as a regional educational hub for farmers to learn how to implement organic and regenerative agriculture practices.
"Gunsmoke Farms is a unique property with special challenges and opportunities for how to scale organic farming," said Gary Zimmer, founder of MBA and author of The Biological Farmer. "We crafted a specific rotation and soil-building program to allow this property to be farmed organically at this scale. This involves tools and practices like mixing together wheat and legume crops to build nutrient-dense, carbon-rich soil."
Soil health is a growing focus for General Mills sustainability efforts. General Mills has contributed more than $3 million to partners advancing soil health on U.S. agricultural lands, such as The Nature Conservancy, the Soil Health Institute, the Soil Health Partnership and the National Wheat Foundation. This includes research and education outreach on soil health practices to benefit 125,000 farmers in the Great Plains.
3rd in organic
General Mills has made sizeable investments to meet growing consumer interest in natural and organic foods, the news release said. The company lists itself as the third largest U.S. producer of natural and organic foods. The company expects its natural and organic portfolio in North America to reach $1.5 billion in net sales by 2020.
Increasing demand for organic products continues to outpace the supply of organic ingredients, especially in North America. Agweek recently has covered issues connected to the importation of feed grains that have been falsely labeled as organic.
General Mills says the the U.S. acreage devoted to organic agriculture is about 1 percent of total cropland, according to the U.S. Department of Agriculture. Over the last decade, General Mills has been working to increase the organic acreage from which it sources ingredients by 160 percent and has become one of the top five organic ingredient purchasers in the North American packaged food sector.