Stoel Rives | Deeply Rooted Podcast S1E1: Keeping America Fed

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In the inaugural episode of the Stoel Rives | Deeply Rooted podcast, host Adam Dittman, Co-Lead of Stoel Rives’ agribusiness, food, beverage and timber industry group, sat down with Jeff Huckaby, President & CEO of Grimmway Farms, to discuss Jeff’s views on the state of agriculture and organic farming.

The Current Landscape of Agriculture in the US

During the early weeks of government responses to the COVID-19 pandemic in the US, there was tremendous uncertainty in the integrity of the supply chain across all industries. In the podcast, Jeff commended the agriculture industry for rising to the occasion to ensure a safe and consistent food supply, noting that “the American farmer was able to keep all the shelves on the grocery store filled every day. You did not see people panicking because there was no fresh produce like there was bottled water or toilet paper. You have to hand it to the American farmer. We were able to keep things going when there was panic buying.”

Despite the industry’s resiliency, Jeff noted that challenges the agriculture industry faces now and in the future are becoming increasingly urgent. “We have less water, less land, and more mouths to feed every single year. So, the pressures going forward are quite extreme. Right now, American farmers are extremely strong. Going forward, there will be challenges,” Jeff said.

Climate Change and the Impact on Water Distribution

Even with advanced farming technology and the experience that Grimmway has as one of America’s largest growers, the changing climate presents an ever-evolving challenge. “We can do everything right but can have a disaster because of mother nature,” Jeff said, adding that “in my 30 plus years of growing carrots, we see the climate changing in some of the different areas we farm in. I’m not saying why it is happening, I’m just saying that we have had to adapt our planning schedules.”

The effects of climate change and water supply continue to impact how Grimmway manages its farms and how it ensures access to water. Jeff observed, “in California, where the majority of our production is, we are learning how we deal with the different climate (changes). We are seeing more of our precipitation come as rain instead of snowpack. When it comes as rain, it comes quickly and we do not have the infrastructure in place to capture it all.” This results in much of the precipitation making its way to the ocean, and when summer comes many of the reservoirs are left dry. This all results in less and less surface water being allocated to farmers.

Supply Chain Challenges

Whether it is timber and forest products or products for food and beverage companies, host Adam Dittman noted that across all the industries Stoel Rives represents there have been significant constraints in the supply and transportation chain. In the agriculture industry, Jeff views these as a growing long-term problem, saying, “when you look at the cost pressures that are coming, they are everywhere. There is a trickle effect that goes throughout the supply chain. All those (costs) go into while we farm the product, during the packaging, and finally – the distribution.”

Jeff observed that Grimmway feels this crunch most severely in moving its products across the country, as there is a shortage of truck drivers, noting that the cost to transport its products to the East Coast has almost doubled. “We’re concerned. How are we going to continue to do this and get our products throughout the US? This is going to be a tough year when it comes to logistics,” Jeff said.

Successfully Farming Organic Production at Scale

Grimmway’s Cal Organic brand is the largest single grower of organic vegetables in the US, and Grimmway has a track record of producing organics successfully at scale. Grimmway made a big bet in the 1990s. “We started with a few hundred acres, and we learned to cultivate them, where to place the fertilizers,” Jeff said. “We have now proven not only can we get similar yields (than conventional farming), day in and day out our organic carrots are higher yielding and higher quality than our conventional carrots.”

With the growth in organic production, Grimmway’s success has gone beyond learning the farming practices that are successful to produce them at scale. Jeff’s team at Grimmway knows the integrity behind organics is so important for the American consumer to make sure consumers understand what they are getting, and Grimmway has invested heavily in ensuring its products keep that integrity as it scales, saying, “nothing has changed from the first few hundred acres to the way we farm today organically. That farm manager is still looking at all those crops, but it is at scale.”

Adam asked Jeff if he sees a world where organic products eclipse conventional in retail grocery stores. “Every year it blows me away the growth of organics that is continuing to happen. From a sustainability standpoint, we are switching all of our lands to organics. That is the bet we are making going forward.”

Episode Transcript

Adam Dittman

Welcome to the inaugural season with the Stoel Rives Deeply Rooted podcast. I'm your host, Adam Dittman, Co-lead of Stoel Rives Agribusiness, Food, Beverage and Timber Industry Group. This season we’re interviewing respected industry leaders and discussing how they and their companies are embracing innovation and capitalizing on new opportunities to move their industries forward in ever-changing world. Subscribe at Stoel.com. That’s s-t-o-e-l.com or wherever you listen to podcasts. This is not legal advice and the podcast doesn't create a client-attorney relationship.

Greetings listeners, and welcome to this episode of the Stoel Rives Deeply Rooted podcast. I'm your host, Adam Dittman. Our guest today is so well known in the agribusiness industry that he hardly needs an introduction. I'd like to welcome Jeff Huckabee, President and CEO of Grimmway Farms, to the studio. Among Jeff’s other accolades is the recipient of the prestigious 2020 Organic Farmer of the Year award from Organic Trade Association and the 2019 Produce Man of the Year award from the Packer Magazine. For any listeners out there who might not yet be familiar with Grimmway Farms, Grimmway is the world's largest grower, packer and shipper of carrots. Grimmway grows over 40,000 acres annually throughout California and six other states and Grimmway’s Organic Division, Cal Organic Farms, is the largest single grower of organic vegetables in the nation with over 53,000 acres growing over 65 different fruits and vegetables. Together, Grimmway and Cal Organic cultivate over 100,000 acres and have 18 processing facilities in seven states. You'll find Grimmway’s products in most every major retail grocery store under Grimmway Farms, Bunny Love and Cal Organic brands, as well as under private label production. In this episode, Jeff and I will be discussing his views regarding the state of agriculture and organic farming today.

Jeff, welcome to the program!

Jeff Huckaby

Thanks Adam. Thanks for having me.

Adam Dittman

You bet. So, Jeff, look, I think most people who know you know that your kind of depth of involvement and experience in this industry give you a lot of perspective. And so I wanted to start today kind of big picture, right? I wanted to give our listeners a sense of what your perspectives are on, you know, what is the state of agriculture in the United States today? What's the landscape? What's the general landscape that we’re up against and what are the challenges that growers and producers are facing today?

Jeff Huckaby

Sure. Well, you know, thanks for the opportunity to be able to discuss this. I look at it two ways. One, and we'll talk about it probably a little bit later, we just went through a pandemic where the American farmer was able to keep all the shelves in the grocery stores filled every day. You didn't see people panicking because there was no produce and fresh produce out on display, like there was water and toilet paper. So you have to hand it to the American farmer that we were able to keep things going when there was panic buying and stuff. But at the same time, when you look at what's happening now and here in the near future, we have less water, we have less land and more mouths to feed every single year. And so it puts a stress on those that are left farming in the companies, the small farms, the large scale agrifarms. Everyone has a part in this and the pressures going forward are quite extreme. And I know we can get into some of those going forward. But at the same time the price of food has stayed relatively low and some of that's been by force by, you know, maybe retailers not wanting to pay more and put it back on the backs of the farmers. But right now, the American farmer is extremely strong and as far as being able to produce what we need. Going forward will be, there will be some challenges.

Adam Dittman

So, Jeff, let's talk a little bit about what some of those challenges are from your perspective. I mean you hear, you know, you hear people talking about things like water and the availability of water. You hear people talking about making sure that the supply chain kind of remains intact. What are your thoughts on some of those challenges?

Jeff Huckaby

Yeah, and those challenges are real, Adam. When you look, I think the thing that everybody is talking about right now is climate change. And as someone that is very dependent on the climate and the outcome of everything we produce is based on the climate, whether it's hotter or colder than normal weather, whether there's a big drought going on or excess rainfall, depending on where you're farming. That's, you know, really the key driver to success for the farmer. We can do everything right and still have a disaster because of Mother Nature. And then sometimes we make a lot of mistakes along the way and the weather is just so good that you have really good crops. So if you're going to take credit for those really good years, you’d better take credit for the bad years too because weather just plays such an important part of it. So when we talk about that climate change, you know, what is happening with the climate? I can tell you that in my 30 plus years of growing carrots, we see the climate changing in some of the different areas. I'm not saying, you know what's happening, why is it happening or anything like that. I'm just saying that we've had to adapt our planning schedules. We've had to start some seasons earlier. We had to get out of other areas quicker because maybe it's freezing sooner. But here in California where the majority of our production is, most of it is around a rainfall, snowpack and just irrigation in general. And we are learning how do we deal with a different climate at least here in the last 10 years or so that when you talk about rainfall, that's the major impact is now we're seeing more of our precipitation coming as rain instead of snowpack. So for years and years, you loaded up the mountains with snow over the summer, it would slowly melt. There were enough dams and reservoirs around that it could keep those fed, and then we were able to move the water around the state and go all the way through the dry hot summer. The problem we have now is we're getting more of it in rain. And when it comes, it comes quickly. And we don't have the infrastructure in place to capture it all, so a lot of it makes it straight out to the ocean. Then we're left in the middle of the summer with dry reservoirs and not a lot of surface water being allocated to the farmers like historically we've been able to have. So, Adam, to me, that's one of the big ones that we are dealing with every day. And for Grimmway Farms and Cal Organic that's one of the reasons why we're now in seven states. If you went back just 15 years ago, we were in two. Now we're in seven. We're moving to the Southeast. We’re in the Northwest. We're in the center of the US. We are up and down the state of California because you've got so many microclimates and California is such a great place to do, to grow. I started to say, “do business,” but that's becoming more and more difficult from a regulatory environment every year. But from a growing standpoint with the seasons that we have here, it's just an ideal place. But we're not able to depend on it like we used to. So that right there is probably one of the biggest changes that Grimmway and Cal O has seen over the last few years is where can we continue this year round production and do it economically and have year-round supply. Year-round supply is extremely important to the retailer. They want to make sure that every time you and I go to the grocery store that that product is there, looks good in high quality every single day, not once a week or skip a week here and there. So the climate is a major issue. How do we capture rainfall and how do we prepare ourselves going forward?

Adam Dittman

Yeah, that makes entire sense to me. I'm curious, Jeff. You talked about your geographical diversity in terms of your growing areas. And in California of course there's the, you know, when we come to the water question, there's this Sustainable Groundwater Management Act, SIGMA, and I'm sure that has some bearing on how plan and manage the farm. Are you seeing that in your other growing regions, groundwater management legislation? Or is that something that’s just not on the table yet in your other growing regions?

Jeff Huckaby

Well, you know, Adam, it’s interesting. You know, California being this huge agricultural state and really, we're kind of behind the times in managing water and allocating water. You look at some of the areas that we we're farming in Colorado or up in the Pacific Northwest or even the Southeast. We know going in this is how much water you get with this piece of land or you can buy more water rights, or you can do things. California has been the Wild West. You just go pump. You drill a well wherever you want and everyone produces whatever they want. That's led to some maybe, you know, mismanagement. I can tell you that historically that wasn't something that we paid a lot of attention to it. We knew we had the wells. We could pump and now we're seeing some depletion in the basin and some things that's not sustainable going forward. Some of it is maybe over production. But some of it goes back to that climate change when now we don't get the surface water from maybe Northern California brought down to the Central Valley that we used to. So there are some things that are going to have to change going forward. Ground is going to be fallowed. We have a big investment in a lot of ground throughout California. Unfortunately, we're not going to be able to farm a lot of it. There's a lot of permanent crops out and around that people are going to take the water and save their permanent crops versus grow vegetables. So things are going to change dramatically over the next 10 to 20 years in California. Some of it is very necessary and others, you know, we'll see if it's over regulated or if the water distribution is where it needs to be. And I think that's what everyone is going through right now trying to understand that and the effects of it.

Adam Dittman

Yeah. You know, it’s an interesting challenge, but one that I'm sure you'll rise to. So, Jeff, you know, another thing that in a lot of the industries that our firm represents, another thing that we're hearing … and this is true for timber and forest products. It’s true for food and beverage, agriculture, consumer products. But you know, there's been a lot of talk, especially during the pandemic about kind of constraints on supply chain and logistics providers. And, you know, it seems like almost every day on the radio you hear something about a shortage of truckers. I'm curious if you view that as a long term challenge for players in the agribusiness industry.

Jeff Huckaby

Yeah, I do. And it's very real, just like all your other, you know, the companies that you're dealing with. We're having tremendous problems mostly on the logistics side. But when you look at the cost pressures that are coming, they’re everywhere, right? So we use wood pallets. We know what's happening in the lumber industry and with the price of wood. They're becoming scarce and they're hard to get. But you've got to have premium good quality pallets or you worry about food safety. And so there's this trickle effect that goes throughout the supply chain. I was just told yesterday all of our corrugated boxes, we're seeing a 6% increase this year, we were told yesterday in corrugated. So the supply chain is going to be disrupted in whether it's supply, actual true supply or the cost of these particular goods and services that we use. And then all that goes into after we're farming the product or while we're farming the product, during the packaging and all that, and then finally the distribution and we talked about early on, you know a little bit of the pandemic and how all the stores were kept fully stocked with fresh produce, and the American farmer and all the hard farm workers were considered essential. So we worked all through COVID. We didn't work from home. We were here every day. We did everything we can to protect everyone. But we needed to keep the nation fed. But that only goes to a point that we need the Logistics and Transportation Group to take it and distribute it from that point. And they did an amazing job keeping our product on the road and keeping it going. Right now though things are really tough. The cost with fuel and insurance and some of the regulatory issues that are going on with trucks and things, we're finding it very difficult to get enough truckers to haul our product from here to the East Coast and even bringing our carrots out of the desert of Southern California up here to Bakersfield. We're seeing big issues with that. The price to deliver our product to the East Coast, where the majority of the people are, where the majority of our products go has almost doubled here just in the last few months. And, you know, and people are willing to pay it just to get the trucks. We know that there's issues at the ports. The ports are stacking up with not being able to get the product shipped out. You know if you're going to Japan or someplace like that that we send our juices. Logistics is becoming very, very difficult and very concerning going forward. I don't think we sit around and say, Well, we just need to get to this point and we're good.” We're concerned. How are we going to continue to do this and get our products spread throughout the US? You know we our product goes to all 50 states and then about 20 different other countries. And we're relying on the Transportation and Logistic Groups to get it there, get it there quickly. So, you know, it's a perishable product and we need all the help we can get. But that is very concerning on just the numbers of available units right now that we see. And I don't see that going away. I think it's going to be a problem here throughout the rest of the year. And my crystal ball is, as far as that going forward, a little bit more difficult for me to be able to project. But this is going to be a tough year when it comes to logistics.

Adam Dittman

Yeah, that’s kind of the concern we're hearing. Hopefully there's some light on the horizon with some easing of hours of service kind of requirements and things like that and, you know, hopefully the US logistics providers will be able to kind of rebound and we'll get more energetic people in the workforce to make sure that these farmers who are, like you said, feeding America are able to get their product on the table.

Jeff Huckaby

Right.

Adam Dittman

Well, Jeff, unless there's anything else you want to say kind of about the state of agriculture generally, I wanted to do some drill down into organic. And you know, obviously Grimmway was a pioneer in organics decades ago. And when thinking about organics, I would say that at least I would guess that most people who think about organics have this kind of bucolic vision in their mind of, you know, small farms, small fields. When Grimmway started, I can imagine you guys only had just a couple hundred acres of organic fields. But now, of course, that's grown to…I think I saw over 53,000 acres of organic fields today. And that makes Cal Organic the largest single grower of organic vegetables in the nation, you know, if we've got the numbers right. And so I can imagine that the tremendous growth has brought with it its fair share of challenges. But you've kind of shown that organics can be done successfully at scale. So my question for you is just simply what do you think are the keys to successfully taking organic production to that level of scale and maintaining it like you have?

Jeff Huckaby

Adam, I think that's a great question. And I think what we've done through a lot of trial and error and probably more error than success at times is trying to figure out how do you do organics at scale. And we've learned early on, you do not cut corners in organics. And the integrity behind organics is so important for the American consumer to make sure that they understand what they're getting. What's the difference between conventional and organic? We grow both. And we know that we have consumers that want organic and they will not buy conventional. And we also know that they have others that feel very comfortable with the conventional produce. We feel comfortable producing both of them. We feel they're very safe. But there are differences in how you grow and some of the outcomes that are associated with organics. We made a big bet back in the late ‘90s that organics would work out. But if you back up a little bit before that, we didn't get into organics so that we could have a different market or do something that's maybe a niche or, uhm, you know something short lived. We did it because we were a carrot company. We're trying to grow carrots. One of the biggest problems is you've, especially most people know that the baby carrots are young. They're mature, but they're very much younger than a full cello carrot. We harvest them 30 to 45 days early. But they're long and skinny and we cut them into two inch pieces. One of the issues, you've got to have a long straight carrot to cut them into 2 inch pieces. One of the issues with growing carrots, you have a lot of nematode problems under the soil and pythium. And you had things that were forking carrots, stubbing them, making them crooked. So you had these fumigants that would help clear up the soil and allow that carrot to grow nice and smooth and long and straight. Back in the late 90s, there was, and there still continues to be a push to get rid of a lot of the fumigants that were out there. And I think Grimmway looked at it and I know Rod and Bob looked at it and said, “We’re in the carrot business. If we have a bunch of forked and crooked and carrots that we can't cut and peel, we're going to be in trouble because our business is based on that.” So go out and figure out a way to grow them without those chemicals. That's how we got into the organic side of it. It was figure out how to grow these things. And can we do it and can you do it profitably? So we failed a lot in the beginning, but what we realized was, all right, let's go back. How do we really work our soils to build the soils up to where they are healthy and living, and that you aren't fumigating and destroying all the bad microbes that are there, but you're also destroying the good ones. So how, how do we build back healthy populations? And that's when, you know, obviously I got involved in it, did a lot of trials and realized that, hey, there are certain crop rotations that build upon the other. And when that happened, those carrots were healthy. They were strong and straight and we did not have the disease pressure. So that built upon, all right, maybe we have something here. Maybe we have a way of figuring out how to do these without these pesticides and these man-made fumigants. So that led to, all right, the way it worked was we have a bunch of rotational crops in between. You grow carrots once every third year. Years in between you couldn't just leave fallow. You couldn't push it to one and every year or every other year. And you know, so I'm out there growing broccoli and cauliflower and lettuces and then these cover crops to rebuild the soil and get organic matter. And once we figured out, all right, there is an organic way of doing this to keep the soils healthy to build them and build for tomorrow instead of just the quick crop that you had in the ground right now. And we saw huge success with that. As a matter of fact, within five years of really trying all those rotations, we noticed that our yields and our quality were close to the conventional yields and quality. Now it came with a huge cost because there were a lot of extra things that we had to do with it. But we learned that it could be done. And you're right. We started with a few 100 acres. We had single beds planted throughout a field of a particular crop. And we learn to cultivate them. We learn to weed. We learned where to place the fertilizers. The fertilizers that are used in organic react completely different than conventional fertilizers that are quick acting. And so usually when you're farming conventionally, you are feeding that crop right then and there for what it needs. Organics, it's almost like you're feeding next year's crop today. And so you're always looking ahead and trying to figure out how do I continue to make this soil healthier and not deplete certain things for next year. And as long as I do it for next year, then that crop will be better and better and better. So we found this path. And we grew one row at a time. Then it was two rows. Next thing you know the planners doing 6 beds or 8 beds and our fields went from two acres of beets to 20 acres of beets. But we couldn't change how we were doing it. We still had to side dress them with the same fertilizers. We had to weed them at the exact same time. We had to pre-germ weeds. Nothing I can tell you, Adam, today has changed from the first few 100 acres to the way we farm today organically, except for we don't make maybe quite the mistakes that we did before. We figured out timing on fertilizers that need to be put in so many days ahead of the crop, et cetera. And with that, we've been able to take it to scale. So now instead of having a field, an 80 acre field with 20 different items in it, we have a lot of 80 acre fields with one single item in it and the next field over has another single item in it. That farm manager is still in that same area looking at all those crops. But it's at scale. We still cannot cut corners, and you cannot get behind. You don't have these magic tools to all of a sudden catch up. If you get behind in organics, you're usually done for the season. But we have now proven not only can we get similar yields in quality, day in and day out, our organic carrots are higher yielding and higher quality than our conventional carrots. The organics have passed that. And I know people say we don't believe that. Usually it's a, you know, you only get half the production. When done right, we have found on these 65 different items that we do that you can exceed conventional yields over and over again. But it's not easy. It's a system that's in place. You're not an organic carrot farmer anymore. You're an organic farmer growing multiple different crops. You have to cover crop and put back into the soil. All of that comes with a cost. So that's why you see the premium in the grocery store. But it is a huge movement. A lot of people, they're more interested in what's getting put on their crops and ends up in the food chain. And so we were fortunate. We started out just to make sure that we would be able to continue to our business and then figured out a little niche that, hey, this does work when you do this. We had some great people early on. You know, Danny Duncan that started Cal Organic Farms that we bought back in 2001 to help rotate with our carrots was a pioneer, too, that just really learned some of these systems. We brought this talent in. We trained people within our company. And now 20 years later it's grown to just be massive. And when we go to the retailers today, that's what they want to talk about. They don't want to talk about conventional carrots, although they may buy millions and millions of pounds. They want to talk about what are you doing organically? How can you guarantee a security of supply year round and high quality? And luckily, we've positioned ourselves with buying the right ground in the right areas that we can do it year round and that the big bet has paid off the last few years.

Adam Dittman

Well, two things, Jeff. One, that's a great segue into my next question about kind of the consumer side and the demand for organic. But first, before we go there, I'd like to say, what you're describing is a philosophy, right? It's a, forgive the pun, but it's a long term ground game. You guys had to have been committed to do this the whole time and it sounds like you can't relent even for a moment or you kind of set back a little bit on kind of all the laddering that you've had over the decades that you've been doing it. So very impressive. I think your company deserves a lot of credit for kind of maintaining that ground game to grow to the level you have.

So let's follow that segue though then into kind of the consumer side. And, you know, I'm going to ask you to kind of get out your crystal ball, so to speak. I mean, you had talked about there are some consumers who …and I say consumers, I mean not only the end user is buying them, right, and eating them, but the retailers who are buying. There are some who do still want, you know, conventionally farmed stuff. But it sounds like there's a growing demand for the organic. And you also mentioned that organic carries with it, you know, kind of a premium, right? But it seems at least anecdotally to me that consumers are willing to pay a premium to know that the products that that they're feeding their children and themselves were brought to their table in a responsible way. So here's where I'm asking you to pull out the crystal ball. Do you see a world where in the retail grocery side organic is eclipsing conventional?

Jeff Huckaby

Yeah, good question. My crystal ball is a little fuzzy right now. So I'd like to look in a little bit better into that. But I go back 20 years ago when I was asked to do this. I would have never imagined we would be at 53,000 acres today. But you go back 20 years ago and the consumer and a lot of times when I talk about our customer, I'm talking about the retailer and then they move it into their customer. But our customer were the natural food stores. Whole Foods was the pioneer. They were the best and they really helped us grow because they came and sat down with us and said we're going to grow this. We're going to go from a couple stores to hundreds of stores and we need a supplier that can do it. We worked hand in hand with them. Walter Robb was very instrumental in helping Whole Foods with that and he worked closely with our team to make sure that we could supply them. That launched this movement for us of being able to go out and supply someone. But the Wild Oats of the world and some of these natural food stores, they were huge for us. But that was pretty much it. You go back ten years ago and the mainstream retailer all of a sudden said, “We’d better start carrying some organic.” Some of them tried it early on, didn't have a lot of luck with it, mostly because availability. Like I said earlier, they want it surety of supply every single day, not every other day, not every other week. Early on, the acreage was limited and so the mainstream retailer they didn't want to mess with one week it was here, one week it wasn't. But those that grasped it, Costco was an early developer of “we want all organics” and worked closely with companies like ourselves. These guys, once they made the commitment, they said, “Okay, go grow for it and we will carry this.” That that momentum once it started and allowed us to grow more acres, which makes us more reliable because instead of having one field that if you have a hail storm or wind storm comes through, you knock it out. Now maybe you have two or three fields. You might lose one field, but you still have this product and surety of supply. Once that happened and the mainstream retailers saw they could have it day in and day out, they started seeing huge, tremendous growth. And so then it started shifting, okay? And then when the mainstream retailer starts carrying it, they can really use and sell the volume. So now all of a sudden, we have this huge growth curve because they're wanting to put it in all of their stores. Some have 2000, 3000, 4000 stores. So just a few bags here and there end up being a lot of produce. So we got on that early and we started watching this growth. Every year it blows me away the growth of organic still today that is continuing to happen. And the retailer when we meet with them, I think I mentioned earlier, you know, we grow a lot of conventional carrots for them and a lot of organic produce. We go in. And millions and millions of dollars of conventional carrots. We have a five minute discussion. “Okay, we got it. You guys are great. You're doing a good job now. What are you doing organically?” All of our conversations are going to that. Some of the even mainstream retailers are saying, “There's a few items that maybe aren't the big movers. And why are we carrying two leeks? Why are we carrying an organic leek and a conventional leek when everyone is not buying leeks every single day? And so if they pay $0.50 more for a leek, why don't we just carry organic because then it covers both consumers.” I see more and more of that happening. We've dealt with it where mainstream retailers have come to us and said, “We're going to quit carrying both. Can you handle it?” And then we've seen it from some of the big guys that said, “We'll get rid of it completely.” And we're like, wait, we can't even handle that. I mean, that's a lot of volume if you get rid of the conventional. So I think there's going to be a shift to more and more organics. I don't think it ever completely takes the place of conventional. Conventional in the way the American farmers figured out how to grow volume and tonnage and quickly and very affordably. I think there will still be those consumers out there that are fine with it. And you know the USDA, FDA, everyone does a great job of enforcing rules and regulations that you know they're not poisoning America or anything. So a lot of consumers are comfortable with the conventional production. We have just felt like from a sustainability standpoint, we are switching all of our land to organics. We’ve figured it out and that's the bet that we're doing going forward. Uhm, so I do see that there's going to be continued shift. If you looked at carrot sales over the past ten years, we're not seeing rapid growth year over year of carrot sales in general. But there is a steady decline on the conventional side and a pretty good growth on organic carrots. So that we still see overall growth in the carrot market. We're seeing that in a lot of the other crops that we do now. So I think you'll see more and more organics in the stores. Less choice of being able to choose between organic and conventional in some of the retailers. Some of them won't ever leave that, I don't think. But the price point has a lot to do with that. Growing organics is costly. Between the fertility and the weeding and some of the other things that happen with organics, it comes at a higher cost. We figured the yield out. We figured out the quality. But it's still when you look at this every year, you're growing a cover crop and you get nothing for it. And you're still putting the inputs in it and you’re discing it under to help your subsequent crops. It comes at a cost. You don't have to do that conventionally. So there's going to be this price premium. I think we've done a good job of narrowing it to where it's affordable for most. But we're going to have to have strong regulations to make sure that everyone is playing by the rules, which I do believe in the US is happening today. And we can't let the consumer get confused as what's conventional and what's organic. And then you'll still continue to see growth in that. As soon as we have issues with the integrity of organics that could affect this transformation of switching more and more conventional products to organic if people don't trust it. And what does organic truly mean. We could have some problems. But as long as we stick to these strict regulations, we continue to see people concerned about their health, the environment, what are you doing for the soil, what's happening with the air. All of that, I think we'll continue to see organics continue to grow. We’re banking on it. Our retail customers and partners are asking us to. So I don't see it going away anytime soon and just continuing to strengthen.

Adam Dittman

Thank you for sharing your thoughts on that. I know asking someone to bring out the crystal ball is always a little uncomfortable. But I appreciate you indulging that and I'm hearing the trends that you're raising. And I think that it's going to be an interesting thing to watch play out over the next couple of years. You know, the reality is every year the population math is that we have more mouths to feed and we've got to figure out what we're going to be feeding them.

So, along that vein, Jeff, I just want to end with kind of one general question for you. And that's, we're looking at horizon of more mouths to feed. And so obviously having an engaged next generation workforce in agriculture and farming is of critical importance. But at the same time, there are lots of choices out there for how people choose to make money, how they choose to employ their time and vocation. And I'm just curious for you, whether you have any views or what's the case to be made to the next generation of farmers that this is a worthwhile pursuit? Is it something that that you can make a long and happy career in?

Jeff Huckaby

Well, you know, I’m obviously very passionate about farming. And I think you have to be to be in the middle of it because, you know, you sit here and you put your heart and soul into a crop for 120 days and the weather comes and wipes it all out and you look at it and think, well, start over again because something happened, you know? And we keep doing this over and over again. But then when you do have a successful crop, you realize it's nutritious, it's healthy, we're feeding the nation. So to me, it's a pretty noble profession to be in. And, you know, we talked about the 40,000 acres of carrots we do. That's 10 million pounds of carrots every day, six days a week, 52 weeks out of the year. And so when you figure 10 million pounds, it's going everywhere. It is feeding a lot of people. Farming is not easy, and you know most professions aren't. But there are a lot of things out of your control that can beat you up. And you've got to do everything in your control that’s right. But the farming that we see that my grandfather saw or my dad and now my son, it's changing over time when you look at technology. And for some that want to resist that, it's difficult and we can't see that happening. To those that love to see advances like myself, it's pretty exciting when the technology … I spent a couple hours yesterday in a field a few hours outside of Bakersfield here with a laser weeding machine that is self, you know, it’s somewhat autonomous, going through the field and zapping the weeds. And through, you know, AI and machine learning and all these things, they are able to identify carrots that are planted 1/2 an inch by 1/2 an inch apart that are now an inch tall and miss the carrot and zap the weed that's in between them, and not touch the carrot at all instead of having to take your fingers and pull that out because it's an organic crop. We don't have herbicides for it. So you look at the some of the technology. And, you know, some of the guys I'm working without there are engineers and software developers and stuff. And yet they're in the middle of a farm field, in the middle of nowhere. The jobs are changing and it is pretty exciting to see that. Part of it is because we have to. If we're going to continue to get better yields and increase and feed more people that are out there every day unless we’ve got to figure out how to continue to improve our profits so that we say sustainable going … you know, we’ve got to keep afloat here. But at the same time, we need to create bigger, better and better products that are out there. Some of this technology is forced upon us because the labor to do this is just not there anymore. You know, the guys we had working for us, the farm workers work their tail off. They work in the cold, in the extreme heat and the rain, the snow. It doesn’t matter. They don't stop because people want to eat. So we continue to work. There's a lot of people who don't want to do that anymore. And so even when we do get those people, they don't work quite the way they did 20 years ago. So the workforce is tough to find. And maybe they're not as efficient or, you know, they don't quite do the job that they used to. So now we're having to mechanize these things. Weeding is a huge thing in organics, to be able to take and pull out every single weed that is there. And to watch this machine go through and you know, a guy’s got a little remote control at the end of the field and it’s going up and down and it's zapping these weeds. It’s pretty exciting going forward and more and more of that is happening. We're using more data and analytics. I think farmers have a tendency to be way behind on that versus some of the other industries who are adopting that and trying to predict and do a better job on our end of what's coming. So I think it's an exciting arena to be in. There's lots of jobs available because not everybody … you know, they think of, “Well, I don't want to get in a truck and drive around for 12 hours, seven days a week.” We don't get the weekends off because, the crop doesn't get the weekends off. You know, it just keeps growing. Or when the weather gets bad is when you go to work even harder because you're trying to protect the crop. Not everyone wants to do that and work, you know, 70, 80 hours a week. We have some things we have to work on as an industry to prevent people from working 70, 80 hours a week year round because we're not seasonal in our business. But I would think it's a great profession to be in. To me it's pretty noble and honorable to be able to do this and feed as many mouths as we do, and do it with something that tastes good, that’s good for you. It's not, man, should I eat this or not, you know, what's it going to do to my body? You know, it's very healthy and nutritious.

Adam Dittman

Jeff, that's great. Thank you for sharing that perspective and all I can think of whenever I talk to you is what you said that you're passionate about this. And I appreciate you coming in today and sharing with our guests your passion and kind of your outlook and perspectives on agriculture today in the US. Jeff, thank you very much for coming. It was pleasure having you.

Jeff Huckaby

Yeah, no, Adam. Thanks for having me. I enjoy talking about this subject and like I said, it is a great profession and I just appreciate being able to discuss a little bit of that with you today. Thank you.

/END/

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