The Blogging Farmer

Alex Tiller’s Blog on Agriculture and Farming

An Organic Farm Demonstrates a Viable Business Model

Organic farming has been around in the United States for a while. It began in the 1940s but in recent years it has risen in popularity. The safety of organic food is appealing to many people, as well as the more environmentally sound practices used on these farms. Climate change and global warming are still hot topics of the day--and farmers are leading the way in showing how we can adapt our economy and our technology to new environmental realities. One thing that keeps some traditional farmers from moving to an organic approach has been the age-old question--can we make money at it? More evidence that organic farms can be profitable has been provided by the success of Full Circle Farm, which is now a multi-state organic-produce business.

CEO Andrew Stout started Full Circle Farm in 2001 with the help of two friends. In 2003 they expanded their operation to 53 acres, and by 2011, the Washington State-based farm had expanded its direct fruit and vegetable delivery to 16,000 customers in Washington and Idaho. With new distribution centers in Seattle and Anchorage, Alaska, Full Circle Farm is poised to grow their 400-acre operation even more.
The biggest multi-million dollar farm business starts with hard work. Stout and his friends worked 12 hours a day to learn everything they could about organic farming, and plan on expanding their operations further. Full Circle Farms works closely with investors and advertisers in order to maintain and expand the business.

While there are many Earth-savvy advocates of organic produce, organic production is a business-oriented field. Stout’s work is proof of this. Organic farming as a viable business depends heavily on following the guidelines of the Environmental Protection Agency. A select list of substances can be used to manage crops, and farmers cannot use genetic engineering or anything other than physical, mechanical, or biological methods to control pests, diseases, and weeds. Crop cultivation and rotations are used to sustain soil fertility and nutrients.
The growing popularity of organic farming opens potentially lucrative opportunities for farm businesses. With the right forward-looking business attitude, knowledge, and hard work, one can succeed over time. The demand for organic produce has never been highe-- Full Circle Farms shows that meeting that demand with solid business fundamentals can lead to outstanding returns.

For more about Full Circle farm, visit its website.

(Published at Alex Tiller’s Blog on Agriculture and Farming, July 01, 2011)

Sources:
The Seattle Times
EPA

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Brothers Ed (left) and Bob Baltz pose in the barn on a  Shorwood, IL, farm they purchased on May 31. Farmland in Shorewood that went for $65,000 an acre during the housing peak recently was bought by the Baltz brothers for $14,500 per acre. (Photo: Scott Strazzante/Chicago Tribune/MCT)

Living Off the Land: Farmers Profit over Housing Industry Boom and Bust

One key to success is to be in the right place at the right time. That is especially true in business, as being in the wrong place at the wrong time can lead to a total loss. Farmers in the past have found themselves on the wrong end of this equation--for example, when land prices are high but commodity prices are low. Other times, farmers have ended up with the sweet end of the stick, Before the housing crisis of 2008, big-name companies took opportunities to buy Chicago area farmland for residential and commercial development. But in 2011, homebuilders cannot profit on land that there is no demand for, so farmers are buying it back at much lower prices than it went for 10 years ago.

One good example is the Baltz brothers. Bob and Ed Baltz took a multi-million dollar deal from a developer, in which the brothers sold their 600-acre property in Will County, Illinois, before the bust. The Baltz brothers sold 300 acres of land, averaging $25,000 per acre, near Chicago. They later used that money to purchase 4,000 acres in downstate counties, most of which they rented to other farmers.

The reason this has become so easy is because lenders cannot afford payments on the land they purchased a few years ago, when they expected to turn around and redevelop it for a huge profit. Farmland in Shorewood, Illinois that went for $65,000 an acre during the housing peak recently was bought by the Baltz brothers for $14,500 per acre. Utilities had already been built into the area as well, since it was purchased by the village in 2005 and zoned for housing development--so not only did the brothers scoop up prime farmland, the land itself is already developed to an unusual extent.

Many non-farmers have tapped into this strategy. While experienced farmers always have an edge, non-farmers can still rent the land to farmers. The return on these investments is satisfactory and future growth is expected. Farmers who keep a savvy eye on the price of land in their regions, and who have a good sense of what the underlying economics will actually support, are in a better position than ever to make smart deals and improve their land base, turning a profit at the same time.
(Published at Alex Tiller’s Blog on Agriculture and Farming, July 10, 2011)

Source:
The Olympian

Hello, and thanks for checking out my blog.  My name is Alex Tiller and I grew up in rural Ohio (Clark County) where my family still owns farmland (corn and beans). I am a member of the American Society of Farm Managers and Rural Appraisers and am also an agribusiness author/blogger. I write about commercial farming, family farms, organic food production, sustainable agriculture, the local food movement, alternative renewable energy, hydroponics, agribusiness, farm entrepreneurship, and farm economics and farm policy. I visit lots of farms in different areas of the country (sometimes the world) that grow all kinds of different crops and share what I learn with you through this blog.? You can contact me via email by clicking here: Email Alex