Financing Local Food Systems

Our mission is to organize farmer-controlled marketing partnerships (LLC’s) that enable Missouri Valley organic and natural producers to return a fair share of the retail food dollar to area farms, ranches and gardens.

We invite experienced producers to join with local landowners and investors to develop and manage farmer-controlled organic food brands for Missouri Valley retail outlets.

Our services will be delivered through local “brand partnerships” that: 1) Earn high levels of consumer support for foods grown and processed in and around Missouri Valley cities, 2) Generate reliable income streams from local and regional retail sales, 3) Support owner-operators and landowners as they pass land on to future generations, and 4) Rebuild critical soil, water and wildlife resources that underpin our food system and long-term food security.

Partnership Benefits

Our brand partnerships offer Missouri Valley producers an opportunity to join local, farmer-controlled companies that combine financing with affordable professional marketing, research, accounting and legal services. This combination is essential for local and regional control of efficient sustainable food systems. Without brand partnerships or similar entities, farmers who rely on wholesale markets, and farmers who rely on direct sales will not have the resources to compete with national food companies that dominate the local retail food sector.

Partnership Functions and Governance

The local partnerships will organize and manage supply lines, financial and marketing resources required to deliver farmer-controlled organic and natural food brands to area grocery stores, food services and restaurants.

Working farmers will hold a majority of the brand shares, with landowners and investors in the minority. Each partner will have a single vote, regardless of the land value, financial commitment to the partnership or the number of shares held in the brand. The voting members will select a general manager from among their most experienced owner-operators. Landowners and investors will be invited to serve on the partnership board of directors.

The partnership investors will finance product and market development without liens on producer land, livestock and equipment. The goal is to build new brand value that can be leveraged to meet consumer demand. The members will negotiate returns to investors, producers and landowners. Whenever possible, processing and distribution will be contracted to locally owned businesses.

Producers and landowners who wish to transition some or all of their land to organic methods will join as non-voting members. They will become voting members when local demand requires added transitional and organic production.

To ensure adequate organic production over time, Raised Free will work with owner-operators, tenants, landowners and their attorneys to develop flexible succession plans that continually expand the size and number of locally-owned  pasture-based farms, ranches and gardens.

Marketing Strategy

Raised Free will emphasize the health, economic and environmental benefits of meat, poultry, grain and fresh vegetables produced in efficient, pasture-based food systems. However, from long experience in organic and Biodynamic agriculture and in marketing, we know that consumers, workers, investors and farmers often live in geographic and cultural isolation from one-another.

Although the goals outlined above are critically important to food security in the Missouri Valley, the communication methods and costs to to build bridges across these cultural spaces are untested, particularly as they affect farm profits. Given these uncertainties, we intend to use personal contacts backed by liberal applications of social media, music, art and food events – all underpinned by ongoing research to identify cost effective coalition building tools that lead to steady farm profits.

Demonstration Project

A demonstration project is planned for two farms that we own in the Omaha area. We invite inquiries from all concerned. Brief working papers are available on succession planning, finance and technology for sustainable agriculture.

Demand

Up-scale Missouri Valley consumers represent an untapped market for our experienced sustainable producers because the vast majority of the organic brands sold in the Valley are imported from outside of our trade areas.

The demand is strong. For example, Omaha area grocery shoppers spend roughly 100 million dollars a year while Kansas City residents spend almost 200 million per year (USDA, OTA and Census data). However, the importers are vulnerable because they are not connected to local growers and because their supply lines are long and sometimes not well documented.

Current Business Environment

We are also vulnerable because the dominant business model in both conventional and organic agriculture works against reasonable farm profits. Farmers are price takers.

Although we have many years of experience selling organic and Biodynamic commodities to food manufacturers and brokers, our farms are not big enough for today’s commodity markets. The experts tell us to buy more land, to scale up. They say that long supple lines and low commodity prices are a fact of life that can only be overcome with lower unit costs.

This out-of-date but still dominant economic model requires farmers and other food entrepreneurs to create profits by continually increasing the size of their operating units, and by making frequent investments in new technology. This strategy includes more land, bigger equipment and more chemicals (on conventional farms) along with ever larger confinement feeding operations for livestock and poultry, both organic and conventional.

Further, conventional farms and even some organic farms are often financed by non-local investors, lenders and land speculators who focus primarily on returns to capital. As a group, these investors do not seriously consider the long term value of fertile land, abundant wildlife, skilled labor and local management by experienced sustainable farmers, ranchers and gardeners.

There is no doubt that the combination of bigger farms, low commodity prices and relatively cheap money has produced very low unit costs for all types of farm and food commodities. This system has also:

•   Systematically drained away rural populations
•   Decreased real incomes in food production and processing
•   Ravaged soil, water and wildlife
•   Drastically limited local taxing power

For more, please read A Consumer-Driven Strategy for Local Food and Farms on this site.

Raised Free’s Sustainable Business Model

This damage does not have to be permanent. Raised Free offers a menu of affordable business services that help sustainable farmers build lasting relationship with Missouri Valley consumers who support fair wages, reasonable farm profits and a better natural environment.

History

The ideas offered on this website start with my late father, Bob Steffen. Dad was the farm manager for Father Flanagan at Boys Town for thirty years and a leader in developing commercial-scale organic and Biodynamic farming methods in the Midwest. He introduced me to many holistic thinkers, including E.F. Shumacher, Wendell Berry and Alan Savory.

My own interests are in attracting qualified investors to farmer-controlled food brands tied to pasture-based food systems that are big enough to supply upscale grocery stores in near-by cities. Woody Tasch and his Slow Money Movement and Michael Shuman, the author of Local Dollars, Local Sense, have much to say about financing sustainable food systems.

Our challenge now is to find the economies of scale that lie between “to small to make money” and the realities of the established food system – all without ignoring the real needs of land, labor, capital and management.

Please contact me:

Jim Steffen
jim@massenafarms.com
402-317-2639

Note: The photo on this page is a courtesy of the Boys Town Hall of History.

Posted 1-30-17, Revised 12-12-17