For the past year, Dr. Mark Lyons, president and CEO of Alltech, has led his multinational company through a global pandemic while maintaining an optimistic focus on the future. Join us as he provides his unique insights from the helm, including the significance of sustainability, countering negative perceptions of agriculture with science and why collaboration is crucial to creating a Planet of Plenty.

Tom:              I'm Tom Martin, and I'm joined by Dr. Mark Lyons, president and CEO of Alltech. Greetings, Dr. Lyons.

Mark:              Great to be with you.

Tom:              Mark, if you would, first, share with us a little bit of your background and how those experiences that you've had in your career are informing how you lead a company in a culture that has such a global reach.

Mark:              Absolutely. I had the great privilege to not only, I think, have a very extraordinary, dynamic father but have the opportunity to work with him, and that really started from a very early age. He, for some reason, didn't believe very much in holidays or vacations, and so he really saw the opportunity, often, to bring me with him and for me to be able to go and visit places and travel and experience things that he was doing. So, I was able to grow up very much with a global view. Obviously, our family coming over to Ireland — that was the first stop, anyway, going over to see family. Then, typically, I'd be able to travel on to continental Europe with him and experience that.

                        That formed, I think, a lot of the interests I had. Obviously, I had an interest in science — science, of course being primary in what we do as a company, but also in his family. That was his first interest, but he didn't stop there. He moved on quickly, obviously, to the business side. For my part, I think, I became very interested in comparative politics and the way that different cultures work around the world. I was able to explore those in my education, along with the science. That part — up to, I think, coming into Alltech — was very much looking at the world from a global perspective and trying to understand it at that individual level, where you have that opportunity to travel, especially being able to meet people and understand how they view the world and the experience that they have.

                        As I came into Alltech, I initially started on the production side. The idea was to really get to know the business from the inside. I was able to complete my Ph.D. at the same time focused in, of course, what is the core of Alltech: fermentation. Then, I transitioned more into the management and the sales side, having worked in Latin America, then up in North America and then over to China, where I lived for six years before coming back here in 2018.

Tom:              You, and your father before you, have spoken often about sustainability and the relationship between agriculture and the environment and sustainability. That word, “sustainability,” is used an awful lot these days. How do you define it?

Mark:              I think people get very caught up and concerned with definitions. I think, in a lot of regards, when I talk to people, I say, “Define it for yourself. What is it that this means?” I think, even in these last 12 months, this word has really grown. Now, I've been thinking about it — and, I think, in a much broader sense. Of course, we always think about environmental sustainability. That's a core element of it. But I think, right now, especially through so many challenges of COVID, we have to think about the communities that are involved, the individuals, the economic aspects of sustainability. We've fallen in love with, to a certain degree, technology and technology companies that come in and talk about disruption and “isn't this exciting?” and fast growth. But at the same time, we also need to look at the wake behind them and what that ends up costing society overall.

                        So, when we speak about sustainability, we really say that we need to think about if this new technology coming out is going to, overall, benefit society. Is it going to sustainably improve our health? Are these things really better for society or not? I think that's what it's all about. I think the sustainability mission is that: It's a journey. It's not a destination. It's all about: How can we do things that provide for today and make sure that we do have enough for today, but we also know that we have enough for tomorrow? To me, it's not about eliminating; it's about creating, and it's about making sure that we are focused on innovation and new ideas.

Tom:              Is there a distinction between local and global sustainability, or do they intersect?

Mark:              I think they intersect, but I think they're distinct. I think we have to reflect on this. Of course, being Irish, I'll tell you a story, and I'll tell you a story about the home country, as it were.

Ireland is an extraordinary environment. You have this protected Ireland temperates; the temperature never really gets too warm, for sure, but it also doesn't get too cold. It'd be very rare in Ireland to see snow. It's a place that, of course, is full of greenery. It's full of different shades of green. It's a highly productive agricultural economy and highly productive agricultural land. But if you looked at Ireland today, and if you polled Irish consumers, they would say, “To be able to achieve our environmental sustainability goals, we need to reduce the amount of agricultural outputs we have.”

                        When you think about that from a global perspective, that's a crazy idea. This is a place that is highly efficient. You have pasture-based systems. You've got other types of systems, lots of different ways of thinking about things. They've got a lot of concern, I think — just as you find in most places in the world — the farmers and agriculturalists are always looking at ways to eliminate waste and improve productivity. Their asset is their land, but yet, in Ireland, that would be the big push, would be: How do we reduce? I think, if that's the approach we take, I think we run the risk of a disimproving the global perspective on sustainability, where we may end up producing the type of dairy products that Ireland is so productive in or beef in countries that are not as productive.

                        I think we find a little bit of the same here. We use a lot of lands and a lot of inputs — especially on the ruminant side, on dairy and beef — that really couldn't be used for something else, and yet, sometimes, we're thinking about things very much on values that we find, perhaps, on a Google search or in a set of tables. We're not thinking about the actual individual producer and what that is doing to them. It's important to keep those two aspects in mind. Local sustainability is also very important, but there's this huge amount of data and a huge amount of information we need to pull in to really make sure that we're making the best decision.

Tom:              It's been only in recent years that the world seems to have begun to fully grasp the reality of climate change and pressures on the world food supply. What are your main concerns about climate and food — where we are today, and where we may be going?

Mark:              It's a great question. What's interesting about it is I studied climate change. I studied environmental science in college, and the science at that stage was clear. Again, you would speak with a climate scientist or you speak to the broader scientific community, and there really wasn't any disagreement. It's really been something that it took the acceptance from society and then, of course, the acceptance politically to maybe say, “This is something — we really need to bring about a change.”

It's crazy. When you think about this country, the Clean Air Act was passed by a Republican president, George Bush, Sr., and that was something that you would not anticipate when you think of the world that we're in today. That gives you an idea, in such a short amount of time, of how things got a little bit off.

                        I think, now, we see a lot more of the outcomes, and I think there are a lot more concerns — whether it's permafrost thawing in Siberia and the potential methane emissions that could create and how that could be a process that we can't turn around, or people being concerned about erratic weather. If I speak to the lady, I stayed over with in Germany years and years ago as a kid — it used to snow in the winter, and it doesn't snow there anymore. So, I think, in Western Europe, there's a real realization, because they see it every winter. They see a change.

                        I think that acceptance has come about from a broader perspective. Also, I think the change in the role of companies has really brought about this change. I guess, as I look forward, I just think that this is a moment where, if we don't make the change that we need to make fast enough, it ends up being an out-of-control scenario. Having said that, I would be very optimistic. When I look at the improvements that our industry, in agriculture, has made over the last 30, 40, 50 years, it's extraordinary how we are producing far more with less. If you start to look at that trajectory and you realize that we have become much more sustainable over this period of time without necessarily putting a focus on that — the focus probably was on reducing costs, but the outcome was an improvement in sustainability — imagine what we're going to be able to achieve now, with so much more technology coming into the sector and a different way of thinking.

                        My concern, honestly, is not so much on the change within the agriculture sector. I think the impact of agriculture on climate change is over-emphasized. I think it's the industry that can change and adapt quickly. My bigger concern is our reliance on fossil fuels and how we will bring about that change, particularly standing here in Kentucky, doesn't disadvantage those who may be energy producers today. How do we make sure that innovation does rest in locations, perhaps, that are high energy producers today and create new jobs and create new opportunities?

Tom:              We've had some pretty powerful dynamics in play, especially in this recent year: COVID-19, the increasing drive toward sustainability and a rising sense of imperative behind climate change. I'm just wondering how all those things have, perhaps, changed your business.

Mark:              Yeah. I think, over the last three years, we're just, at this time of year, thinking about my father, who passed away three years ago. We went through a big cultural change within the company. We had been building and growing the company, and, of course, that was a big shock, losing him. I think, for our business, the story that started three years ago, in a certain regard, prepared us, in some odd way, for this challenge of the last 12 months.

COVID has obviously impacted all aspects of all businesses and supply chains. It's made everything so difficult. We're very much a relationship business. We're a business that likes to be in the office. We like to be together. We like to be with our customers. That's what drives us. "Make a friend" was the message my father was always sharing with us — that we were to go out and foster relationships. That has been a big challenge, but I think that the cultural closeness that was created over the last three years — as we reflected on the loss that we had and thought a lot about what we talk about a lot, the “founder's mentality,” the objective and the way that my father thought and how we could continue to replicate that and grow — that concept got us ready.

                        We've stayed very close. I could tell you — as I'm sure you would hear from many other executives — I think this time of the pandemic, it almost takes more energy. We travel less, but we're talking to people, probably, even more. I think the responsibility of senior management, but particularly the CEO, has changed. I believe — and I think this was the case before for our good CEOs — but the CEO should not be responsible for just the bottom line or top line or those types of results. You have the CFO. You have the COO. The CEO is there to make sure that you maximize the most important asset of any company, which is people, and making sure that those individuals, I think, in this period of time, not only are productive but also healthy, and that's making sure that we can protect them from COVID and put those policies in place and make sure that works but, also, their mental health when we are separated.

                        I think that aspect has been a big shift. We've adopted all the technology possible, but I would quickly say that I think it's a poor second to being in-person. We look forward to being together again. But really, I think that both of these thoughts — the COVID challenge and then the sustainability, which has really accelerated, I think, in terms of urgency over the last 12 months — is something that it's probably positioned the company instead of a lot of the things we talk about. We've been talking about this “Working Together for Planet of Plenty^TM” mission now for over two years. I think that has really moved from being “some idea that Mark has” to, really, something that is driving our business. In every single conversation we have, people are bringing it up in new ways. I think that goes together with that realization that sustainability is something that's here to stay.

Tom:              I know that part of the growth that you mentioned a moment ago includes the acquisition of the Environmental Services Company, E-CO₂, to provide advice, tools and services to help farmers measure and improve their environmental performance. With the rise of the European Green Deal and the United States' renewed commitment to climate action, over 70% of the global economy has now set or is intending to set targets to reach net zero emissions. Do you sense that E-CO₂'s moment has arrived?

Mark:              It's interesting. Before we called it the Alltech ONE Ideas Conference, it was the Symposium, and we had the symposium where one of the themes was “niche to mainstream.” I went and found the book the other day, and here it was, from the late '90s — here was my father saying that these ideas that Alltech had were becoming mainstream. Of course, we look, now, forward, and it was probably 20 years later when that was true.

I think E-CO₂ is actually that type of a story. This was something that was niche. It was something aspirational. I think it was these number of retailers in the U.K. who said, “We've got to put plans in place so that we can make sure that we know what the environmental impact of farming is and of our products on the shelf.” That was where the business began. It was actually founded by a farmer, which I think makes it highly relevant. It was always built from that perspective and then came into the Alltech fold about eight years ago. It was something that was focused there. We thought, “Maybe there's an opportunity to go global in the future, but it’s very much a British business.” Now, over the last 12 months, it has truly gone global.

So, as we build out our what we call now Planet of Plenty partnerships — so, working with customers, helping them with their sustainability journey — E-CO₂ plays a critical role in that. We can explain what the environmental foot-printing is, what the greenhouse gas emissions are. We could talk about ways to reduce those, then, as we bring in the Alltech colleagues and look at the nutrition and different technologies that can be utilized or different farming practices. It's a critical aspect, because if we don't measure it, it doesn't get done. So, we've got to make sure that we have that ability to measure the science in it and provide the data behind to track things.

                        When you're able to put a dashboard in front of somebody and say, "This is what we've done in terms of your environmental footprint" and, actually, you overlay on top of that the economics, you can quickly see that the two can go together very easily and that environmental sustainability or improvements around that can very much mean economic sustainability as well.

Tom:              I mentioned the EU Green Deal, which is driven by the aim of the European Union to become the world's first climate-neutral bloc by 2050. I'm wondering: What is your view of that initiative?

Mark:              Well, I think it's something that I'm very positive about. I think it is a good move. There are a lot of different initiatives there. There's a lot of thinking about cities and the way that cities are going to operate, especially — COVID, again, is challenging us on that. It really is top of mind. When you think about consumers in the U.S., I think there are some people who would reflect on those elements. In Europe, it's very much a situation that people are thinking about the environment in a much more serious way. They also see this as an opportunity for leadership for the European Union. This is an area, this is a topic, that Europe has always been leading on. To make that type of a goal, that this is something they can pull together and achieve — I think that aspect is very positive.

                        One concern I would have is they have a farm-to-fork program. This program, when you look at who is running it, it's very much led by some medical doctors, some human nutritionists, but it's not really looking at things from a pure or a full-chain approach. That's something that has been a little bit of a concern for us. Does agriculture or even the agri-food industry have a seat at the table?

                        I also think that there are a lot of very well-minded intended ideas. I think the question is going to be: How are they going to be implemented at the member-state level and then at that very local level? How do we make sure that we don't have unintended consequences? Which I think every government, when they go out and create these types of programs, has to look at and make sure that we are really achieving the best, exactly as you were describing earlier, asking earlier, this global-local question. If the EU puts so many constraints on the producers within the market, how does that then respond to imports? How are you going to hold imported products to the same levels, and how is that all going to be balanced out?

                        I think the phasing of this process is going to be a critical element. We're really pushing our teams to get very engaged and help to really achieve that implementation of this type of initiative and make sure that we take all the stakeholders into account when we're making the decisions that we need to make.

Tom:              You mentioned the importance of being aware of anticipating unintended consequences. Here's one: reducing the use of farming inputs, fertilizer, pesticides. It's been going on for many years; machinery, mapping, measurement systems have all become more efficient. But are there risks that reducing the use of those inputs could potentially lead to a reduction in food output?

Mark:              Certainly. I think, again, when you think of that global-local element, we've got to think about that aspect. We don't want to become so focused on reducing the environmental impact that we're not looking at the total production. We're often pushing people to say, “What is the production we have per unit of milk, per unit of bushel of corn?” or whatever the metric is, because that's really what we need to be looking for. We are in a situation, as a global planet, as a global community, where we do have malnourishment. We do have a huge amount of countries that are going to be left in a position post-COVID that is even less food-secure than they were before. So how do we make sure that we keep that productivity and realize that that's a big part of what we need to be doing as well?

                        Having said that, I think that there are different technologies. The soil science area is fascinating. We think about the microbiome of the soil and what we're able to achieve there — maybe changing some of these inputs, fertilizers, pesticides, and moving towards a more holistic approach and regenerative agriculture. I think these are areas that we can keep that productivity and add the efficiency but also keep the outputs. Those are the types of areas that we're really trying to put a focus on and highlight on as we look at Planet of Plenty and as we look at our Alltech ONE Ideas Conference coming up. Those are the types of stories we're looking to focus on.

Tom:              I think we often talk about achieving the goal of net zero emissions in aspirational terms, as something off in the future, but I'm wondering if we don't now have the affordable technology to achieve net zero.

Mark:              Yeah. I think that, from a lot of what I've looked at, those initial steps — I think we can make some big reductions, but when getting to net zero, I think those last steps are going to be the most costly. We're going to need to look at the things that are simple and easier to do. There are a lot of technologies, particularly when it comes to energy, that are becoming more and more affordable that can help us to make those first steps, but I think that last piece is really where it will be a little bit more challenged.

                        For me, I suppose we've always been ones that have said — if we think of the Chinese context, “the journey of a thousand miles starts with the first step,” it's the type of thing that we have to make those first steps. And typically, once we create those frameworks and start to say, “These are the KPIs or the outcomes that we want to achieve,” I think that will lead people in the right places. So, we're really trying to push our colleagues and encourage our customers to be trying out new things, trying out technologies. That's where a lot of our interest comes in, on that ag-tech area, the aggregation of technology, so that we can start to see what works and what doesn't.

                        We have to try things differently in different places. It's one of the things I love about my job, is how diverse the agricultural sector is. I think it is going to be something that will take some time to get there, but if we don't get started, we'll simply be analyzing this to death and we'll never really get there. I think there is a lot there, and so many of the technologies, they do help us to lower costs. That's one of the great things about, I think, especially the American agriculture sector. So much is really created around the improvements and the productivity, and nobody's having something subsidized. They're really having to go out and sell their idea and implement it because it's giving that return on investment.

Tom:              Earlier, when we were talking about the EU and the Green Deal initiative, you expressed the hope that agriculture would have a seat at the table in those discussions. I'm wondering about one aspect: carbon capture and carbon sequestration. Is that a science that is agriculture's role, and should that be a part of that conversation?

Mark:              Yeah. There's a lot in terms of, I think, people thinking about carbon farming and these types of things. I think we have to look at it as, maybe, an element that could be incorporated in different agricultural systems. One of our Planet of Plenty videos is actually an example of silvopasture, which is a mixed-use system where you have the land, you've got crops, you've got trees growing and you have, in this case, beef cattle in the same environment.

                        I think that's a great example of, really, what this whole system is. We are in this biogenic cycle, especially in the ruminant side. There's a lot of focus on methane production and a lot of confusion about it and a lot of, I think, misinformation when you really look at the fact that the methane is staying with us for a short period of time: ten years. It is a potent greenhouse gas, but it also breaks down quickly. Also, everything that the animals are eating, the CO₂ that ends up going back into the crops, is what created the plants that they consume, so it is a cycle. I think it's something that, as we become more and more efficient, as we probably have smaller dairy herds and smaller beef herds — which is something that has been a longstanding trend already — you can actually see how the overall environmental impact is reduced, too.

                        I think that there are some of these technologies that can come in. I think it will become an element of agriculture. People are going to look at their farms, at their operations, and say, “Let's add this aspect in,” whether that's methane digesters and trying to create energy out of materials already produced or, indeed, pure carbon capture plays that are going to be involved, and looking at some of those ways that you can mix things up. I think it's an exciting area. Again, it creates another income stream, a new income stream, for producers.

Tom:              Let's stay with that theme of methane for just a moment. In an article on its online news page, the United Nations states that, and I'm quoting here, "Livestock produce significant levels of methane, a greenhouse gas, and these could be reduced drastically if we eat less meat and more plant-based foods." Here, again, the signs are promising, such as the rising popularity of plant-based meats now being sold in major international fast-food chains. Do you envision a large-scale consumer shift to plant-based meats? How should the beef and dairy industries be positioning around the prospect of an increasing market presence of these meat alternatives?

Mark:              I think it's interesting. We've noticed, over a number of years, that the UN does like to come out with these statements, and we're not really sure which part of the UN they come from, because you do have such, obviously, a broad array of individuals, but you also have them living in a certain demographic and a certain geography in the world, and they sit in a certain place in society. There's been a massive amount of money made with plant-based meats already, and a lot of them have been quite speculative, a lot on the banking side — those that launched the IPOs, et cetera. There are a lot of people looking at this area as a big moneymaker for the future.

                        I think, if you step back and you look at the science, both in terms of the environmental side, I think there are some questions in terms of the claims being made — claims that, I would say, in more established industries, will be difficult to make. Then, on the human health side, the science there is also a little bit dubious.

So, we think that it's definitely going to be a trend. It's an area that has gotten the attraction of people. It's an area that people are interested in. It's catchy, and there's been a ton of marketing money put into it. But actually, when you look at the numbers, the growth actually has been miniscule compared to the overall protein market. That has been quite interesting to note, particularly during COVID. When you look at the percentages of increase for plant-based protein, it seems dramatic and astounding. When you look at the growth, the small percentage growth that took place more in the animal proteins, that actually dwarfs the growth that took place, on a real-volume basis, of plant-based.

                        We are a world that needs more protein. At Alltech, we don't have an issue of that being insect protein or that being plant-based proteins. But to a large degree, we've had a lot of these types of products in the past that have been far less processed. Again, based on my time in Asia, there's a lot of plant-based proteins that are out there and traditional ways of producing food, and I think coming at this thinking that this is some amazing technology and not thinking, again, about sustainability in a broader way — of what takes place in communities that were producing these products, of what takes place in the environment if we remove animals. Animals are critical to the soil health of our planet. If we remove them from the system, we're going to see a lot more deleterious effects. A world without cows, a world without animals, it's not a world I want to be in, and it is a world that we need to have to be able to make sure that we achieve what we need to.

                        As an environmentalist, I think one of my biggest concerns with this area is that we may have a population, we may have consumers who think they're genuinely doing the right thing by changing their diet, but in reality, we're actually not solving the climate issue, which is really being driven by fossil fuel usage.

Tom:              That's really interesting. Can you expand on that a little bit? Why is it wrong to think that way?

Mark:              I think it's because we're not looking at the whole system. We're not looking at the fact that agriculture produces, yes, greenhouse gases, but it also, as a primary function, captures carbon. Our food production system is actually pretty efficient, and it's getting more and more efficient. If we all stopped eating meat, we do not save the planet, if you want to say it that way. We do not stop climate change. This is one area where I do think diets will change. Diets will change in a lot of different ways. I think we're learning more and more about how our individual diets need to change throughout our lives. There are certain times we probably need more protein and times we need less. Also, it depends on our individual behaviors and lifestyle.

                        I think that, to me, it simply comes down to the fact that if we do not remove ourselves from fossil fuel usage and we continue to put more new carbon into the environment, that is really what's driving the change. The carbon that is being put into the atmosphere by animals in agriculture is carbon that we sequester with the crops that we grow. I think looking at that in that regard and realizing — can we improve yet further? Absolutely, we will, but that's not the area that I think we should be focused on. Those are the areas that concern me when I see statements like that from the UN, where I think that they're taking their eye off the ball and perhaps being, sometimes, misled to lead us down a path that may not achieve what we need to.

Tom:              It's projected that, by 2050, ten billion people will inhabit this planet, and that means making room for feeding and sheltering another two billion people in less than 30 years. Can world population growth at that pace be sustained, even as we're also dealing with climate change?

Mark:              Yeah, I think it absolutely can. I think a lot of it does have to come back to the fact that we do need to make changes. This has to be based on continued improvements. I don't think that this is something where this is a done deal that we can achieve this, but I do think, if we continue to focus on innovations and new technologies, it does give us that sense that the next 30 years really are going to be the most critical.

This is a time where we've got to make sure that we, I think — particularly in a time where we're not necessarily our most connected globally — we need to realize that we do need to be thinking as one world. A lot of this growth is going to be taking place in Asia. It's going to be taking place in Africa. It's going to be taking place, therefore, in places that we need to make sure that we are partnering with. A lot of what we're trying to do — we're operating in markets around the world as we connect with entrepreneurs. We help them to grow their businesses and, in a large degree, bring them the technology and the ideas and, sometimes, just the inspiration that they need to move those businesses forward. Those are going to be the people who build and have got a nutritional base for that protein that's required, the food that's needed for that growing population and, at the same time, grow those economies.

                        I think the fact is, when you speak to people in that position, they clearly see climate change as part of the environment that they're in, and they realize that this is something that they have to be thinking about. But I think, when we look back over the history of humankind, we've had situations such as this before where it was stated that we couldn't sustain our populations, and we've always achieved that. We have a lot of changes, of course, too, in more developed countries where, obviously, the population growth is slower. So, when I look at it in terms of the speed of growth, I think we're in a position now that this can be managed, I think, to a large degree. I think we're going to need some of those new people coming in, young people with new ideas, and they're going to be a big part of us helping us to achieve what needs to be done.

Tom:              At the beginning of the year, we spoke to a few experts about their insights and expectations for agriculture and food in 2021 and beyond. Some talked about the impact COVID-19 has had on the food chain; others talked about new regulations, innovations, emerging technologies. What big themes and big trends currently capture your attention?

Mark:              I think we spoke about a number that, really, at the onset of COVID, we could already see were going to be challenged. One of those was this whole idea of supply chains. Suddenly, when you have a disruption like COVID, your supply chain is thrown into chaos. You've got to not just understand and trust your suppliers — you also need to understand and trust your customers and make sure that those systems can work and be fluid and adapt to shocks. That was a big theme that we saw.

                        Another big theme has been health. Everybody is, of course, far more concerned about their health than they were before. I think that is changing our diets, and that really should be one of the major drivers for our, of course, dietary decisions.

I think another element, of course, that we've seen over the last year has been very much around inclusion and, I think empathy — companies needing to make sure that they're thinking about all stakeholders and all elements and how they're having a positive impact there.

Those have been, I think, big elements. One that's come forward to us also that I think is a little bit new actually goes back to your question around the growing population. If you think about how much food is wasted in our world, that, in and of itself, could have an extraordinary impact on all of these elements: on feeding the planet, on the environmental impacts and, really, on just having a better environment that we're living in. If you consider all food waste, that would actually represent 8% of greenhouse gases that are produced in the world — it would be the third-largest country, if it was a country, in terms of greenhouse gas production. This is an area which, again, is almost a pre-competitive area. How do we, as an entire food system, reduce that? We know that a lot of it is happening, obviously, a little bit through food production at that farm level, through transportation, through spoilage, maybe, in the retail side or waste in restaurants, or it's happening in our own homes. So, what are the types of things that we can work together on and, again, very much on a local level to reduce that? I think that could have a huge impact on us feeding that global population.

That's a real trend. I think it's starting to move. I think this is going to be a big area of focus, and it's one that we within Alltech are talking about. We're going to be exploring some of that starting in May and then growing out over the next few years to think about how we can reduce that food waste.

Tom:              You mentioned supply chain disruptions, and that makes me curious. Has your company, Alltech, experienced problems due to supply chain disruptions?

Mark:              Well, I think there was certainly a heightened focus on this area. Again, it goes back to that element we always talk about: making a friend — and we normally are thinking about that being a customer, but it also goes with our suppliers. We have to make sure that we have good relationships with them. Thankfully, we really did.

I think that there have been disruptions for our industry. Alltech, I think we're in a very good position. We have over 100 production facilities around the world. That gives us a lot of flexibility. It gives us options. If one facility has an issue, we can supply from another facility. I think that optionality helped us.

                        We also immediately, at the start of COVID, stated that safety was the number-one focus, and we wanted to take care of the health of our colleagues, our customers and our communities. Those were our three Cs. I didn't realize it at the time, but that really set the tone and made sure that everybody understood our operational capabilities and our ability to keep our own people safe, our customers safe. It was the critical thing, and so we've been able to maintain operations all the way through COVID. We haven't had those disruptions. We also have been able to have that flexibility of supply, having different suppliers, having deep relationships with those suppliers that have really helped us.

Tom:              Back to looking at trends, I'm wondering: What trends are actually, in real time, transforming the future of food and feed?

Mark:              I think, with the trends, I do think that the sustainability one is probably the thing that's changing the fastest. We're seeing it in Europe very quickly, but we also see, now, a trend here where, if you go into a Panera, you can see a “cool eats” menu. You can see what might be better for the planet. You can see the same types of ideas being explored in Chipotle. Other companies are looking at that as well.

                        Those types of messages are kind of a new fad. I think that quickly behind the fad needs to come the data and the story backing it up. That's something that I think we all need to be aware of. I don't think our industry is yet quite as focused on that as maybe we need to be. We've been thinking about: how did that shift, maybe, take place, and how quickly will it occur?

                        The other elements, though, might come back to this health idea. I think there's a lot of focus on: How can we produce foods that are better for our health, that are more enriched, that are health-enhancing? We've been able to show that, through some of our programs, we're not only reducing the reliance on antibiotics and food production but that we're actually reversing antibiotic resistance in bacteria and systems in and around those farms. That isn't an impact just for the production of that food but may be, also, an impact for the health of the people who work on those facilities.

                        That's an element — health, overall, and a focus on health — that, through this time of so much loss and so much grief, maybe is a silver lining or a benefit, that we're going to be more focused on our health and also, maybe, start to look at nutrition and our diets as a way to improve our health as opposed to constantly thinking that it's going to be a medical intervention that overcomes that challenge. I think that might be a big trend. When we look back in ten years, we'll say, “Wow, that was a moment when that aspect of our society changed.”

Tom:              The idea of carbon counting is pretty new to a lot of people. Do you see the day coming when carbon counting will have a place right there on the menu alongside calorie counting?

Mark:              Yeah. As I mentioned with the Panera idea and, I think, Chipotle — I think Chipotle is taking it a little bit further. They're almost saying, “You're having this burrito. What's the impact on the environment that this burrito had?” I don't know if they've got it totally dialed in yet, but they're seeing that as a clever way to differentiate themselves vis-à-vis their competitors.

We've noted that one in five millennials would say that they would change their diet to improve the planet's health. That's a pretty staggering number. I think that you could see, certainly, the case that this is the next thing, the next fad that comes along: “I'm not just thinking about how many calories I had today. I'm thinking about, actually, ‘What was the impact I had on the environment?’”

                        I think, within the European context, it's even going further. People are already changing what they're doing in terms of how they're traveling, where they're willing to travel, what types of jobs they will take because of the distance they will travel. I think the dietary aspect of that is just going to be a part of it, and that's going to be something that I think we'll probably see play out in a number of different ways. Diets have already been shifting, probably, away from beef more to pork or maybe poultry products over a number of years. Aquaculture is growing, and maybe that's going to play a bigger role, as well, as people start to think about those things. That's where we have to make sure — and I think our customers need to make sure they're getting out and telling the story and are accurately able to demonstrate and provide the metrics of what the actual environmental impact is of their food.

                        When you look at a steak in a restaurant, it's not exactly going to be totally clear what the environmental impact is of that. Every single producer has a different way of producing. I think that's where we've got to get to what we're really explaining: “As a producer, this is what I'm doing, and this is what makes me different to, maybe, somebody else.” I think those elements are going to be really speeding up in major trends that are going to impact our producers over the next five years.

Tom:              Earlier, you mentioned the mantra that your father carried with him throughout his life and career and, now, you are carrying with you. It's simple: it's “make friends.” How does collaboration fall into elevating the agri-food sector, the whole sector?

Mark:              You know, it is an industry, and he used to like to say this: He had a colleague early on who said to him, "Pearse, isn't this great? We travel around, we talk to great people, and they pay us for it." It always stuck with me, where I genuinely would say agriculture is one of those sectors that is made up of great people. I think anytime you're involved with animals, it somehow makes you a better human being. I think that they're very much people who care about each other, who care about their communities, who are there doing the right things, maybe, because they work outside, because they work on the soil, because they work with animals. For us, I think, when you have that type of mindset, I think that's the mindset that helps you realize you depend on your neighbor. You depend on that person coming down the farm drive and, maybe, giving you some insights or ideas or providing you with a technology. Collaboration is somewhat second nature within our industry.

                        I think, within our company, when you start out as a small startup, in a way, and grow, and you've got to go and do things a little bit differently — and I remember my father saying this to me: "Mark, I had to go and do it myself because I didn't have anybody else. But you, you'll have the opportunity to work with lots of people because of what has been built, because of what we've achieved” — and because of where, I think, the world is.

I think that the world is in a position for collaboration. It's been something that we've really all seen as a major growth driver for the future. It sits in a very important place. When we talk about Planet of Plenty, I would say the words in front of that that are even more important: "Working together." Working together is a clear signal. We are open to work with people. We're open to discuss ideas. I think that was always his way. He loved to have people come and visit, to sit around and talk about ideas. Many times, there was nothing related to business at all. It was simply, "How can I help you? How can my people help you? How does this have that impact?" And that positive impact makes that difference that we want to make in the world.

                        As I mentioned before, I think, three years ago, we really reflected deeply on that, and we said, “That is our mission. That's our purpose as a company.” It suddenly went from being a Pearse Lyons idea that he encouraged his colleagues to take on to, suddenly, everybody's idea. I think that's been, really, one of the most exciting things over the past few years. I guess that's what they always say: Great leaders make more leaders, and I think that's what he achieved.

Tom:              Alltech's work in Haiti comes immediately to mind — the Haitian coffee product. What new business models might be created following that Planet of Plenty mission statement?

Mark:              I think one of the elements that we've been talking about that goes back to that trend of trust. There are transactional relationships, and those are critical to businesses and very important. That's a lot of what our businesses operate, but partnership is something different. Partnerships, I think, really are going to be the future. We are now moving into a phase where we've had a few dozen companies that we are working with, different markets that have been success stories focused on this Planet of Plenty collaboration. I think that's a new business model. That's a way of saying, “What are the aspects that you're working on? What's the big goal you have as a company? How can we help you to achieve that?” And equally, in many regards, those customers also may be companies that are helping Alltech with our own objectives.

                        So, the mutually aligned goals, the idea that this isn't just about one sales order; it's about a much longer-term relationship. Companies that are saying to us, "Can we work with you on multi-year projects and deals?" That's a new business model that's pretty exciting that I think has come out of this message, because a lot of people are saying, "We love the Planet of Plenty idea. We want to be a part of it. How do we do that?" So we've created that framework.

                        It's interesting because some of the framework and some of the ideas of this actually came from something that might seem not so aligned and something that took place now ten and a half years ago, which was the Alltech FEI World Equestrian Games. Within that, we created feed partners, and those feed partners were customers of Alltech, and we help them with their marketing. We help them with their IT. We help them with whatever they needed, and I think we're able to replicate that now — maybe in an even more meaningful way in terms of some of these big issues that we're all going to be dealing with globally in the Planet of Plenty partnerships.

                        That's a concept I'm very excited about. What's been great is, as I said before, it's gone from being an idea to really something that our local markets are embracing. I was on a call today with Asia, Latin America, North America. In each of those calls, people were talking about a company that they had a connection with, an idea they had about creating a Planet of Plenty partnership. So, it's really taken root within the organization, and it's moving very quickly.

Tom:              You have a very big event coming up. In the years before this pandemic forced you to go virtual for 2020, the Alltech ONE Ideas Conference has gathered in one place. You mentioned the Symposium, which is what it was before it was called ONE, and that was here in Lexington, Kentucky. It gave a platform to agri-food expertise, from insights into animal feed and nutrition to developments in CRISPR research from all over the world. In fact, we interviewed many of the people who spoke at those conferences. And I have to tell you, Mark, my head was about to explode at the end of one of those days. The information is incredible.

So, the dates of the virtual conference have been set for this year: May 25–27. This will be the second year that the Alltech ONE Ideas Conference has gone virtual. What are the themes for this year's conference?

Mark:              Well, we've taken this and focused back on that Planet of Plenty message. If you look at the logo we have for Planet of Plenty, we have these three leaves. One stands for science, one stands for sustainability and one stands for storytelling. We're going to use those three as the themes of the conference. We've been thinking about this in terms of how these elements are interconnected. There's so much that's taking place, but we have to also be led by that science. At the same time, we can only really communicate, and communicate effectively, if we have that storytelling ability and that ability to connect with people. Those are going to be, on a broader scale, some of the themes.

                        Some new things that we're doing — we did decide, almost this time last year, to move the conference to a virtual format. We had to make that decision. Our team worked very, very quickly and established a very successful program. We took the conference from an in-person, 3,500-person event to almost 25,000 people on the platform. This year, what we want to do is make sure that we're engaging in a deeper way with that audience and also continuing to grow. We decided to invest in our own platform. We didn't want to work purely with third parties. We now have our own trade show area. We've got our own place that really looks like, almost, the Central Bank Convention Center, and so it's really exciting to see how we're going to be able to utilize that.

                        The conference will be those three days. If people come through, they'll be able to see some of the different tracks they normally would see by species, perhaps something on general business, on human health, crop science, all those different things that they would see — but they're also going to be able to look at different talks and see, “This one is focused on health and wellness. This one is focused on sustainability. This one is focused on regenerative agriculture, and I want to follow those throughout.” So now, different to a physical conference, it's very easy to be able to listen to a talk, then pop into another section — plus all the information that's on demand so people could come back. I think that might give us all a little bit of a better chance to not get a headache, as you did, and be able to absorb some of the information.

Those are going to be exciting ways that the conference is changing. The other element here is that we're going to open the conference, the trade show area, a little bit early so people will get a chance to go in. They'll be able to experience that and use the environment. I think that'll create the opportunity for more interaction. This platform gives us the chance to have one-on-one meetings but also workshops on certain topics where smaller groups can have a voice. I think, through so much of the past year, when you're looking at the screen and hearing somebody give a talk, that's one thing, but that opportunity for interaction is the key. That's, of course, what makes our conference unique, I think, and really exciting — when we're all able to be in the same place and have those conversations, that makes that impact. That's what we want to make sure that we replicate and what our teams are working on now.

Tom:              Well, I must say that it's a delightful headache to have. I'm wondering: Do you hear from people? Do you get feedback about the connections made, ideas hatched, collaborations formed after a conference has occurred?

Mark:              Absolutely. It's something that there isn't, certainly, a year that goes by that there aren't many of those collaborations created. We have a lot of people who end up creating businesses together or establishing working relationships at the conference. They can hearken back to that and say, "Well, I met that person at the ONE; I met that person in the President's Club," or whatever the case may be. That's a critical aspect.

                        I think the networking element is really important. What we want to make sure is that we provide that networking opportunity in this format, and I'll tell you why that's important. Say we have 3,500 people at the physical conference. We probably have three-fold that, so maybe roughly 10,000-plus people who have never been to the conference. But if we're up to 25,000 people, that means there are people for whom this is the conference — the majority of people have experienced it in a virtual format than ever in a physical format. So, this really means that we can connect with anyone at any time. We can engage with those people, as I mentioned — perhaps they are entrepreneurs who are running a business who don't have time to travel or have never had the ability to gain access to this type of information. Also, we now are able to provide them with an opportunity to network with others. I think that's a really exciting thing.

                        It really goes back to the purpose of the conference. Is it to explore new ideas? Absolutely, but it's also about the relationships that we build along the way and how we can continue, beyond the conference, to have that positive impact. It was something we wanted to do, for a number of years, as a virtual element — and of course, in 2020 we were forced to. It's going to be something that will be with us from here on out. That's the challenge for 2022, is running a physical and a virtual conference as one.

Tom:              That's going to be interesting. Is registration already underway? Is it available on the Alltech website?

Mark:              Yes. Everything's up there on the website at one.alltech.com. The registration is open. We're looking forward to welcoming so many people back in. We have, of course, continued coverage throughout the year, and that has been another element that we've added with our Alltech ONE Virtual Experience, but we really shifted back into that Alltech ONE Ideas Conference message and the look and feel of that.

I'm really, really excited for this year's program. As I mentioned already, we already have a team, a separate team, working on 2022 — when I think it's going to be even bigger — who are really pushing to think about things in new ways. I mentioned that waste aspect before. That's going to be something that is a big focus. Just one shocking statistic that I learned on food waste is that the average American wastes the same amount of money on food as we are receiving in our stimulus checks — $2,000 of wasted food per American in a country which actually has some of the cheapest food in the world. The volume of that food is also very significant. That's an idea, I think, that we need to focus on and will be an element of this year's program and a much bigger element of next year's.

Tom:              Well, something to ponder. Thank you for leaving us with that. That's incredible. Dr. Mark Lyons, president and CEO of Alltech, thank you so much for this almost hour-long conversation. I really appreciate it.

Mark:              Yes, thank you for the opportunity. I really enjoyed it as well.

Tom:              I'm Tom Martin, and thank you for listening

As a certified B Corp, McCarty Family Farms meets the highest standards in environmental sustainability and public transparency. Ken McCarty, one of the fourth-generation owners of the farm, discusses their focus on sustainability and animal welfare and how this focus has been beneficial for both their operation and their customers.

The following is an edited transcript of the Ag Future podcast episode with Ken McCarty hosted by Tom Martin. Click below to hear the full audio or listen to the episode on Apple Podcasts or Spotify.

Tom:                          I'm Tom Martin, and joining me is Ken McCarty, a fourth-generation owner of McCarty Family Farms, located in northwest Kansas. The McCarty Dairy Farm has been in operation for more than a century. The farm is Non-GMO Project-verified and has an emphasis on environmental sustainability and animal welfare. Thanks for joining us, Ken.

Ken:                            Thank you, Tom.

Tom:                          And let's begin at the beginning, because it goes back a bit. When was McCarty Family Farms founded, and why dairy?

Ken:                            Well, to answer the question of “why dairy,” I'd have to travel back in time and ask my great-grandfather. But our family's journey in the dairy industry began in the early 1900s in northeastern Pennsylvania. Our family’s farm was started by my great-grandfather, Taylor McCarty. And my grandfather, Harold, took that farm over. And my dad and my mom moved about a mile up the road and built the dairy that my brothers and I were raised on. And in the early ’90s, they began to look for expansion opportunities that would afford for my brothers and I the opportunity to come back to the farm, if we so chose. And we looked — or, I should say, they looked — all throughout the United States and eventually settled here in northwest Kansas. We moved in 1999, and we began the McCarty Dairy that I work at today in April of 2000. And since then, we've been steadily growing. And today, we encompass four farms here in the West: three in Kansas, one in southwest Nebraska and a farm in partnership with another farming family in west-central Ohio.

Tom:                          Because it's going to inform just about everything else we're going to talk about, tell us about the decision to become certified as a B Corp.

Ken:                            Yeah. To become a B Corp was not a decision that we made lightly. And we had some great leadership and inspiration in our customer, Danone North America; they're the largest B Corp in the world. And through their guidance and, then, through their inspiration, we made the decision to head down the path of becoming a B Corp. We were already heavily involved in third-party verifications, whether it be through auditing our environmental practices or animal welfare practices or worker-care practices. We're well-versed in that type of mindset. And we truly valued and believed that the B Corp mindset, the B Corp mission, was a mission that was aligned with our core values. And as such, it just made sense to take that next step. Although that wasn't an easy step to achieve that, we thought it was the right one to make, and we have no regrets, looking back at it.

Tom:                          That aspect, of third-party verification, would seem to really keep you on your toes. And do you regard that as a good thing?

Ken:                            Oh, absolutely. Absolutely. You know, being accountable to a higher cause and being accountable to someone that I don't go to work with every day does nothing but improve our business, improve our farms, improve us as owners and managers of our business. It simply just makes us better, because it doesn't allow us to ever rest on our laurels.

Tom:                          What are some specific ways that you meet the standards that are called for in B Corp certification?

Ken:                            Some of the cornerstone principles that we have focused on within achieving the B Corp certification have really centered around environmental sustainability and worker care. So, with regards to environmental sustainability, our farms and our farming practices — as well as the practices that we employ on our dairy farms, our raw crop fields and on through to how we work with outside vendors — we work very hard at auditing all of those. We quantify all of those with a third-party group called Eco Practices that calculates, almost in real time, our environmental impact, from soil health to biodiversity to water conservation and water quality preservation to carbon sequestration to a mission analysis. We try to take a very full-circle view of environmental sustainability and encapsulate that into a publicly available, well-based-in-science report.

And then beyond that, when it comes to things like worker care, we work with Validus, a third-party auditing body, to, on an annual basis, review our employee practices — things like what our wage scale is, what our benefits packages are, do we have things like whistleblower policies and whistleblower systems available. Anything and everything that we do as it regards to taking care of our team members is audited by Validus. And that just lends itself to making the transition to a B Corp all that much easier, because we already are being audited. So, why not just take that next step?

Tom:                          Tell me a little bit more about your approach to carbon sequestration. What do you all do in that regard?

Ken:                            So, our first approach to the overall carbon cycle is to create less of it. But when it comes to sequestration, we work very closely not only with our customer, Danone North America, and with our third-party verifying body, Eco Practices, but we work with our local farming partners to roll out the practices of cover-cropping to try to implement things like minimum-till or no-till. Those types of infield practices that are actually pulling carbon from the air and putting it back into the soil are all the programs that we’re really trying to implement — not only on the acres that we control but the acres that we influence. And we're using our acres and our farming practices and our business model to try to inspire our farmer partners — and, hopefully, beyond our farmer partners, you know, to the farmers that are within the local communities that surround us or across the nation — to demonstrate that, “Hey, these types of practices are good business, and with the added benefit of they're good for the world as well.”

Tom:                          What drove the decision to go for a non-GMO certification, and how has that improved the quality of your operations? And I'm wondering, was it difficult to arrive at the decision to do that?

Ken:                            Well, that decision was really prompted by our customer, and it was a very daunting ask. I would say that the thought of it was more difficult and more scary than the application of it.

                                    What was interesting to us as we embarked on that journey — we had to do it pretty suddenly, and we had to shift gears for not only ourselves but for our farmer partners rather suddenly. And our farmer partners embraced the change. In fact, we've had former partners come to us and say, “I've been wanting to make this change for years. I just simply haven't had the market.” You know? So, there was that initial mental roadblock that we had to overcome to achieve that. But since then, the feedback that we've received from our farmer partners and from the data that we've collected off of our own acres has been nothing but encouraging. We’re showing greater economic returns. We’re showing equal or greater yields. And I think that the biggest testament to why this has been a positive change for our farms and our business is (that) our cows are more productive, and it appears our cows are healthier by being fed primarily non-GMO ingredients.

Tom:                          It sounds to me as though the market is becoming much more friendly to sustainability and the whole concept of what you are doing on your farm. Is that what you're finding?

Ken:                            Yeah, I think so. You know, I think that there's going to be a greater call from the consumer, a greater call from NGOs, a greater call from Mother Nature herself for businesses — and in particular, agriculture — to adopt more sustainable practices. And I know, myself, when I go to the grocery store or when I go to a coffee shop, for example, I do, now, pay more attention to the on-package business practices that are stated by these companies. And if I have the ability, I will inherently choose the more sustainable company.

Tom:                          If you don't mind, I have some very specific questions about what goes on at the McCarty Family Farm operation, and let's begin with water and how you optimize water efficiency and reuse. How do you do that?

Ken:                            Well, here in northwest Kansas, and in southwest Nebraska, water is a very serious issue. We sit atop the Ogallala Aquifer, which is a depleting groundwater source. And you know, it's pretty honest to say that the future of these communities and the future of this area and the future of our business depend on conserving that natural resource. So, what we try to do is we try to implement water conservation measures from the soil all the way through our production and supply chain, ultimately (all the way) to the cup of yogurt.

                                    Infield practices, such as cover crops through the application of manure solids (and) minimum-till, help us increase organic matter levels within that soil, which ultimately help us retain moisture within that soil. We also measure the amount of water that is required by the crop and the amount of water that we’re applying to the field through the use of soil moisture probes, where we can, almost (in) real time, watch the depletion rate or the restoration rate of the soil moisture levels in those fields. And we can be very, very specific in the amount of water that we apply.

                                    Moving beyond that, we have, on our farm in Rexford, Kansas, an on-farm evaporative condensing plant that allows us to not only reduce the freight of finished goods from our farm to market, but it also — and more importantly here northwest Kansas — allows us to reclaim approximately 65,000 gallons of fresh water a day and keep that water atop the source from which it came. It allows us to, very greatly, offset our dairy farms’ draw on the Ogallala and offsets drinking water and wash-down water that would otherwise be used.

                                    Beyond that, we try to implement what we would call smart cow-cooling technologies. Obviously, a cornerstone of a dairy farm is taking good care of our cows, because they take care of us. And in order to do that, we need to try to mitigate the effects of heat stress. So, in those hot summer months, we sprinkle our cows with fresh, cold water. And there are times where maybe the cows are out of the pen or there aren’t a tremendous amount of cows under those sprinklers, so those sprinklers will shut off at those times. We also have those sprinklers set to increase their sprinkling time and frequency as the temperature increases. So, as that heat stress level increases, our efforts to combat that increase proportionally.

Tom:                          It sounds like you really embrace data. What are some important ways that data has been integrated into your day-to-day operations?

Ken:                            Yeah. So, data, I think, is the future of our farms in terms of how we are going to optimize our farms and our business. And you know, we're collecting data from as many sources as we possibly can and collecting data, frankly, that we don't even use today, just because we don't know how to use it today.

                                    But that being said, a lot of our data is very, very cow-centric. So, we’re evaluating, on a (regular) basis, herd health events, production levels, feed efficiency data, all in the effort to try to continuously drive improvement on our farms. We’re also collecting a tremendous amount of financial data that allows us to make better business decisions and, ideally, preserve our business for the next generation.

                                    Beyond that, we’re working with third-party groups that are quantifying infield farming data, soil organic matter levels (and) nutrient loads within the soil. Obviously, we’re collecting water use data. And all of that is flowing into systems that ultimately help us make better operational and strategic decisions for our farms and for our business.

Tom:                          Earlier generations relied heavily on instinct and on knowhow that was passed down from generation to generation. How does the use of data replace that reliance on instinct?

Ken:                            You know, my brothers and I are very competitive individuals. And as such, that kind of makes us emotional individuals. And the use of data has allowed us to step back, be less emotional about the decisions that we make within our business, within our farms, and allow us to make decisions that are really based on fact and not instinct and not emotion. That being said, instinct and emotion still have a place on our farms and within our business, you know. That historical knowhow still matters. My dad is 78 years old and is still on the farm every day. And there is a wealth of knowledge there that brings a completely different perspective. It ultimately grounds my brothers and I into — it grounds us in reality, and it grounds us in the things that actually matter. It doesn't allow us to get caught up in the details that would distract us from the big picture.

                                    So, there is always a place for that. But when it comes to executing day-to-day decisions, we're trying as best as we possibly can to ground those decisions in facts and in data.

Tom:                          What sorts of innovations or emerging technologies have captured your attention?

Ken:                            Oh, man. You know, innovation and new technologies are developing at such a rapid pace, it's almost hard to keep up with it, but the adoption of robotics on dairy farms and within agriculture in general, to me, is incredibly exciting. Finding qualified labor is increasingly a challenge across the ag industry, so being able to eliminate that human factor and implement the use of robotics, I think, is incredibly exciting.

                                    There are some technologies emerging now to utilize artificial intelligence to analyze large datasets and to help us make better decisions on our farms. That, to me, is incredibly exciting because, as I mentioned earlier, we were collecting so much data (that), at times, it can be overwhelming. And at times, you know, we know that we bring our own bias to that data analysis. So, utilizing a tool that can eliminate that bias and perhaps bring correlations or opportunities that we may otherwise miss, to me, is incredibly exciting. And there's other advanced things like CRISPR technology or things like the utilization of drone technology — those types of innovations will do nothing, in my mind, but drive positive change in the ag industry.

Tom:                          Do you use robotics or automation in your barns?

Ken:                            We do use some, yes. The ability to implement those types of robotics in our farms (that) are 20-year-old facilities can be somewhat challenging. But in our newer facilities, in our newer farms, yes, the implementation of robotics is coming very quickly. So, it's an emerging technology that we keep our eyes on closely. And when feasible, when economical and when possible, we’ll implement that technology.

Tom:                          I'm sure you stay on top of industry trends, and I'm just wondering: What's on your radar right now?

Ken:                            Oh. Well, you know, I believe that the future of the dairy industry is going to be a future of increased traceability and increased transparency and an increased level of accountability to our customers, the consumer, our communities and the environment. Consumers, I believe, are demanding that. Mother Nature is demanding that. I believe that we’re just going to continue to see the demand for that increased accountability increase.

                                    But I also believe that the trend towards consolidation is going to continue. It doesn't seem to be slowing down. The dairy industry, unfortunately, is losing farms at a very rapid pace. So, I think consolidation will continue, but I also think that there's going to be a continued emphasis on farming the right way. I don't believe that the future of the dairy industry or the future of the ag industry is going to have any place for bad operators, operators that are not working towards a greater cause or towards the improvement of the environment around him. I don't think that's going to fly moving forward.

Tom:                          We've been through a very strange and difficult year this past year, and the pandemic is continuing. What do you see happening as a result in the overall dairy industry? What's happening as a result of this pandemic?

Ken:                            Well, you know, on top of the day-to-day operational challenges the COVID pandemic has created, you know, trying to make sure that our team members stay healthy (and that) our farms stay fully staffed and operational every single day — that, in and of itself, is a big task. But the pandemic has created a tremendous amount of volatility within the markets, which, at times, can be a great thing. You know, buying opportunities have existed. But beyond that, it's just the lack of predictability that has come from this pandemic — not only the lack of predictability in my everyday life but the lack of predictability in markets, the lack of predictability in consumer demand. All of those things have taken what is already a stressful and fast-paced, high-pressure job and elevated it to a level that I hope we don't have to continue for another year.

Tom:                          Really! You touched on this earlier, but just to wrap up our conversation, when you sit back and think about it, where do expect the dairy industry to go from where it is now?

Ken:                            Well, you know, as I mentioned earlier, I think the dairy industry is going to go to a more sustainable place than what it has been historically — and that's not to say that the U.S. dairy industry hasn't made absolutely phenomenal strides towards becoming more sustainable. It certainly has, but I think there's going to be an increased drive for that. I think the dairy industry will ultimately arrive in a place where there are fewer larger farms. And I think that that's going to lend itself to, I hope, a more transparent and a more traceable food supply that should allow us to be more responsive to market conditions, consumer demands and, ultimately, needs from the environment or from our cattle.

Tom:                          That’s Ken McCarty, owner and manager of McCarty Family Farms in Kansas. Thanks so much, Ken.

Ken:                            Thank you.

Tom:  And I'm Tom Martin, and thank you for listening

Have a question or comment?

As the food supply chain shifted over the past year, so did consumer eating habits. Matthew Smith, vice president of Alltech, joins the podcast to reflect on changes in the dairy industry and to discuss the global demand for dairy products, the impact of dairy alternatives and the importance of sustainable dairy production and farm waste management.

The following is an edited transcript of the Ag Future podcast episode with Matthew Smith hosted by Tom Martin. Click below to hear the full audio or listen to the episode on Apple Podcasts or Spotify.

Tom:                          I'm Tom Martin, and I'm joined by Matthew Smith. Based in the U.K., Matthew is vice president of Alltech and is responsible for Alltech E-CO₂, the global rumen function platform, and all (of) Alltech U.K. He's worked extensively in the feed industry in Asia and Europe for more than 27 years. Greetings, Matthew.

Matthew:                    Hi, Tom.

Tom:                          Well, the whole world has been through quite a difficult and strange year at the hands of this coronavirus and COVID-19. If you had to cite a few key outcomes of this experience, what would you say they are?

Matthew:                    I think, Tom, on reflection, that there are many of those reflections, but reality is, it’s the resilience of producers, (the) resilience of the food chain. I never thought that I would walk into a supermarket and see empty shelves in my lifetime, and like so many people across the world, (I) was witness to that, but I think the takeaway I would have is how quickly the food chain managed to rectify itself and how quickly we managed to get food onto shelves. So, it’s really that speed of recovery after the initial shock. That’s one big thing.

                                    I would also say that within our industry, from talking to customers across the supply chain, it's been that demand shift from the QSR (quick service restaurant) segment into retail. So, retail for milk and milk products and meat. And then, finally, the big take-home for me, personally, has been the focus that we now have on food — about its provenance, about the way eating habits have changed. And there's a growing awareness of food health and that healthy food (equals) healthy people.

Tom:                          So, the nature of demand has shifted. What about pricing? What’s happened with pricing for dairy during this time?

Matthew:                    If we look at the situation today, I think demand is high. We saw, in the first six months of last year, a rapid drop in terms of farm-gate pricing. I mean, some regions (saw) demand dropping. However, that rectified itself, I guess, through the second half of last year.

                                    I think one of the drivers on the demand side, Tom, is the idea that milk is a healthy drink and has health benefits in terms of improving immunity. And so, I think, from a commodity perspective, demand is still good. There’ll be lots of stockpiling going on, I would have thought. At the moment, there’ll be caution across the world. So, stockpiles will be going up, and that, of course, changes some of the shapes of demand.

                                    And now, of course, we start to see shortages on the protein side — particularly soya. And as that run continues for most of the world, I think prices in many regions may well have held up by farm-gate prices, but feed cost has really been impacted. And with that growing and getting higher, that impacts margins. And so, the margins are quite seriously under threat in many parts of the world. And in some parts of the world, (they’re) getting up to 7–10% less than they were this time last year. So, with that demand, I guess, it’s going to stall later on in the year, Tom. That's what the markets are telling us, and that will become even more of a challenge for producers, and margins, I guess, will continue to stay under pressure.

Tom:                          According to data from the International Farm Comparison Network, the IFCN, there has been an enormous increase in dairy production. And in what parts of the world are you seeing the most impressive growth in production?

Matthew:                    I remember vividly, about 10 years ago, reading a report from Euro Monitor — the guys who pull data together on the food industry and in other industries — and they predicted a 10% compound annual growth rate for milk demand in Asia. I remember looking at that figure (and) thinking, “Well, that can’t be the case,” because the rest of the world (has signaled that) that number was less than 1%. But I think if I look back in a 10-year period — and having spent a lot of time in it myself — we have seen that come through. The demand is definitely there. People are looking to drink milk everywhere across the Asia-Pacific region. And you know, that still holds today and into the future, as far as the drivers exist.

                                    So, we do see a growth in production as well, but it's a challenge. Raising dairy in parts of Asia is a massive challenge, given the fact (that) you’ve got your real limitations in terms of forage growth. But as we start to see more and more investment from large-scale processes around the world going to Asia (and) more education about growing those forages, about managing cows, then those factors are coming together now.

                                    And we are seeing a huge explosion in production. It started in South Asia — principally in India, where they have an awful lot of cows and (are) making those cows more productive. Even taking a small incremental increase in production, we see a big change in the volume. So, Asia is where it’s happening, and other parts of the world. Some last year, you know — Russia really has been managing a bit of a turnaround in terms of production and (is) moving away from reliance on imports of cheese and butter and (is) really increasing productivity.

Tom:                          Are there spots in the world where production is in decline? And if so, what's happening?

Matthew:                    I don't necessarily think of it as production declining. It’s probably (simply that) it isn’t growing. It, you know, one could argue, is decline. There are parts of the world — some of the Latin American countries have found a major challenge because of economy and politics, (as have) parts of Asia. In fact, Japan (and) Korea have seen reductions in volume. But again, I think that's more driven by the high cost of production in those parts of the world, and people may be looking at other choices.

Tom:                          How are dairy alternatives derived from coconuts, almonds, rice, oats and other plant-based sources — how are they impacting demand for products derived from cow's milk?

Matthew:                    I think that segment is clearly — I know, from talking to trade companies and retailers, that segment is growing, and it's growing quickly. Of course, the numbers have to be looked into. The numbers don't lie. And the reality is that I don't think there's been a significant impact on the demand for dairy — although, again, when you look at statistics and commentary on those statistics, it's interesting to think that, you know, here in Europe, (where) I’m based, the total volume of those alternatives in 2019 was the same as 1% of the volume produced by the dairy cows in Europe. So, I would say (it’s) not a significant impact. People continue to grow. Consumers will exercise their choice. However, the demand for dairy continues to outstrip (alternatives) — maybe not in terms of growth rates, but certainly in terms of volumes.

Tom:                          What sorts of challenges to dairy production do you consider the most important to think about and to overcome?

Matthew:                    Again, looking at the world today, you know, in the present moment, I feel, Tom, that the sustainability debate is no longer with us. I think it's gone. I think it's now a question of policy-makers asking us in the industry, you know, “What are you guys doing about it?” It's a given; it's with us. So, that’s why I say it’s no longer a debate. And I think it's critical that producers don’t simply view sustainability as an added cost burden. If you view sustainability in its true light, it's an efficiency game. And we have to get that message across to producers, across to the supply chain. It's critical that we get that right.

                                    You don't have to look too far back in history — it's clear, you know, across all species, (that) farmers and producers have become so much more efficient in the last 50 years. And if we look back with the right topics, we would probably say, today, (that) we've done a pretty good job, but we know there's a lot more to do, and there's a lot more (that’s) important to demonstrate to those policy makers and to the public, that we can implement those changes, and innovation will certainly help us measure, monitor and be able to describe how our industry is sustainable. So, I think that's the biggest challenge.

Tom:                          Matthew, from the perspective of your leadership role for Alltech E-CO₂, what are your views about the EU Green Deal and the goal for Europe to become the first continent in the world to become carbon neutral by 2050?

Matthew:                    I think it’s a noble cause. At the same time, though, it is aspirational. And the targets, which are being discussed and may well become legislation soon, do require scientific basis, because those policies will have to take into account consumer demand.

                                    Really, at the heart of the green deal lies human health. It is about human health. That sits right at the center. And of course, reducing the use of farming inputs, fertilizer (and) pesticides has been going on for many, many years, as machinery, as mapping systems and measurement systems have all become more efficient. But ultimately, reducing the use of those inputs could potentially lead to a reduction in food output, which ultimately will mean that the retailers can’t keep shelves stocked.

                                    So, I think we need some science-based targets, and it's great opportunity, actually, Tom, for science to lead us in the right direction.

Tom:                          What about the issue of managing the waste produced by farming? What’s happening or would you say needs to happen in that area?

Matthew:                    Waste in any farming system has always been, probably, been perceived as physical. If you think about a typical dairy unit, you know, those losses can be as high as 25% from pasture and conserved feed stuffs, which are converted into milk. But I think we need to add to that the fact that environmental waste is also a big consideration.

                                    So, producers are increasingly aware of the level of waste and understand, too, that as we make efficiency gains, the real heart of the issue is to reduce those losses, to reduce the waste. And management practices have taken us a long way, and machinery has taken us a long way. Nutrition has taken us a long way, particularly mitigating some of those losses with the use of feed additives. But everything has to come together, Tom. It’s about doing 100 things by 1% to achieve 100%. Everything needs to come together so that we get the right amount of feed converted into protein. And a 1% reduction in waste, ultimately, is going to impact that bottom line and self-sustainability.

Tom:                          And speaking of things coming together, do you see a need for more consolidation in the food chain? And if you do, what would that look like?

Matthew:                    I think it has to come. When I compare food chains in the Western world in comparison to some of the food chains in Asia — where they do have incredible integration right the way through, from crops harvested and to the farm, the feed stuff, the animals, the processing, right the way through to the retailer all in one chain. It is possible to do.

                                    I think we will see a lot more integration in the next few years. I think some of the retailers will actually integrate back into the chain, take more ownership here in the U.K. Most of the retailers would have dedicated pharma-producer supply groups now, and that's good for the industry, because they take a keen interest in terms of cooperation — making sure that there’s transparency in that food chain, there’s providence to allow the whole chain to tell the story of food. And I think when you have the challenges that we faced in the past 12 months — the pandemic hitting — those integrated food chains are probably faster to respond to a crisis than a fragmented food chain would be. So, I think there are a number of forces at large, Tom, which are driving that integration anyway.

Tom:                          Let's turn now to food security. And first, if you would, define that for us. In your mind, what is food security?

Matthew:                    I tend to think of food security through a simple lens. You know, if, at the end of the day, you ask yourself the question, “How much food have I wasted today?” If your answer is “Zero, I’ve not wasted anything,” then food security is an issue for you. And ensuring that we can overcome challenges of global trade, challenges of regulatory hurdles, which do impact food security, I think the biggest challenges is disease — be that animal disease or human disease. We see how damaging the first virus, the African swine flu and the avian influenza can actually be on most supply chains. So, it’s important we try to do everything we can to stay one step ahead and, again, as I said originally, do everything that we can in that supply chain to make sure it’s resilient.

Tom:                          Jumping over to another area: labor. You have talked about fair treatment of workers. What are your concerns there?

Matthew:                    I think the concerns that I would have are the same concerns that consumers have today, Tom, in that when you make your food choice, that food choice is still driven by price. But of course, there are other factors that come into that decision now — more so, the nutrition — but where does that food come from? And concern over fair treatment of workers in that supply chain is now very much at the top-of-mind for consumers. So, again, I think the industry can work together to help with education and make sure that everybody involved in that supply chain understands the importance of the role that they’re involved in.

Tom:                          What sorts of innovations or emerging technologies are on your radar or have captured your attention and your interest?

Matthew:                    Technology, it’s certainly everywhere in our industry today. It does come as a surprise to some people who don't, maybe, understand the farming industry. I was talking to a group of school kids a couple of weeks ago who were asking me about believing that farming was just animals, and they were amazed to understand that, today, it’s about artificial intelligence, it's about big data, it's about robots helping make a big difference in terms of stock management.

                                    So, for me, there’s so many parts to that technology question, but I think that keeping an eye on things, allowing producers to maybe spend time focusing on other parts of the business, (and) also giving the peace of mind that if intervention is needed, you know, you're going to be told that intervention is needed and warned that if you don’t do it, you know, there will be an impact on your business. So, I think that the collection of that data and what that data will tell us in terms of, ultimately, sustainability — the more we can amass, the more we can interpret, the more we can learn. So, I'm really excited about where technology is taking us. I think it's kind of keeping pace with this whole discussion on sustainability. And I think we need to focus wherever we can on making it work to tell our story.

Tom:                          That’s Alltech Vice President Matthew Smith, joining us from the U.K. Thank you, Matthew.

Matthew:                    Thanks very much, Tom.

Tom:                          And next in our dairy series, Kansas farm owner and manager Ken McCarty. I'm Tom Martin, and thanks for listening.

Have a question or comment?

In January 2016, a massive fire burned down Kentucky’s largest individual cattle market, the Blue Grass Stockyards. The stockyard has since rebuilt its facilities, but like many in the agri-food industry, it has faced new challenges over the past year. We spoke with COO Jim Akers about the current state of the meatpacking industry, the challenges and opportunities for rebuilding the cattle market and more.

The following is an edited transcript of the Ag Future podcast episode with Jim Akers hosted by Tom Martin. Click below to hear the full audio or listen on Apple Podcasts or Spotify.

Tom:                          In January 2016, a huge column of black smoke rose over Lexington, Kentucky. It could be seen as far away as Louisville, 70 miles to the west. A massive fire had broken out at Bluegrass Stockyards’ main Lexington facility, devastating the largest individual cattle market in Kentucky. To put it in perspective, Bluegrass Stockyards is to cattle what Keeneland is to Thoroughbreds. It’s been five years since the fire, and much has happened in that time. Joining us from Lexington is Bluegrass Stockyards CEO Jim Akers. Thanks for joining us, Jim.

Jim:                             Glad to be with you.

Tom:                          So, you all had a new 232,000-square-foot facility up and running on Iron Works Pike near the Kentucky Horse Park outside of Lexington just a year and a half after the fire. How did you manage to do business during the time before you could reopen?

Jim:                             Well, we were very fortunate in our structure in that we have two other facilities that are located within 35 miles of Lexington here, and we very quickly — in fact, by Monday morning after the fire that actually happened on Saturday, we had added sale dates at our Richmond and Mount Sterling locations and basically moved. We moved our Monday sale to Mount Sterling (and) our Tuesday sale to Richmond. We relocated some of our key employees, and customers listened to us, listened to our field people. And we picked right up and went on. Granted, customers had to travel a little farther, and (there were) certainly a little more logistical issues for us, but you know, it helped us maintain our business and our customer base.

Tom:                          Was the new location on Iron Works Pike already on your radar, or did you have to scramble in the aftermath of that fire to find a new spot?

Jim:                             Well, we actually already owned the property. Approximately 10 to 15 years prior to the fire, there was an effort to move the stockyard out of downtown Lexington, and this was one of the potential locations for that. So, we didn't have to acquire property, but there also were no real plans in place for the construction either.

Tom:                          I think we should emphasize for our listeners that it's been determined that the fire was an accident at the old facility, and that facility had been there for a lot of years and was wood. Correct?

Jim:                             Yes. Yes. Predominately, yes.

Tom:                          Right. So now, five years later, Bluegrass Stockyards is facing another challenge: the COVID-19 pandemic. Back in March, just as we were beginning to comprehend what a pandemic meant, the industry saw a rapid drop in the value of an animal — and at a critical time for local producers. Tell us what that period was like for the stockyard business.

Jim:                             Well, very complicated, Tom, from early April on up through, really, (the) middle part of the year, where you had multiple factors at play. Just the comfort level of people coming out to do business and, you know, coming into a facility — you know, that comfort level was pretty shaky. The market itself was extremely volatile. You know, we saw exorbitant prices at the grocery store, yet just a horrible market for the animals themselves on the farmer side. And so, it really caused a lot of people to hold cattle much, much longer than they would have. Our volume through the months of April, May and June (was) considerably below a normal year. We’re in a pretty significant liquidation phase in the cattle industry right now anyway. So, we were already hurting for numbers, compounded by the fact that people were hanging on to them, hoping that the market was going to get better. It was a pretty tough stretch.

Tom:                          You mentioned that people were kind of reluctant to gather, and now, it’s been many months since then. Has that kind of sorted itself out as people have become accustomed to masking and all that?

Jim:                             Yeah. Our level of compliance is far greater today than it was when we first started. We put a lot of measures in place literally right out of the gate because we were told by the Department of Agriculture and others that, you know, we have to continue to operate. We’re the only source of ready cash that a lot of these farmers have got. So, we had to try to keep running. And we started out by limiting the number of people that were allowed inside the sales arena. I actually had to post people at the doors to count heads in and heads out and try to keep that number down very low, and it was predominately just buyers at that point. We would let consignors in one or two at a time to watch their cattle sale. So, it was really a burden.

                                    As we've moved along and understand a little more about social distancing, masking and all those kinds of things, we provide masks at the door to all our customers if they need them. We've actually eliminated about 2/3 — well, more than 2/3; almost ¾ — of our seating in the arena by blocking off those seats, enforcing social distancing. You know, people are, for the most part, fairly compliant with that. It's gotten better as we've gone along, certainly.

Tom:                          Well, you literally had opportunity rise out of the ashes in that this was an opportunity, out on Iron Works Pike, to start from scratch, to build an entirely new facility. And I'm just wondering how it differs from the original site. It might seem obvious, but maybe you can tell us more.

Jim:                             Well, you know, (I’ll) talk about the stockyard operation first. You know, having an opportunity to start from scratch with a clean slate and design a facility just like you'd like to have it was something that was pretty special. And so, obviously, the stockyard facility itself is far more efficient. It takes fewer people to operate. The movement of the cattle is quicker, safer and easier than it was in the old facility. Our ability to address workplace safety issues (and) cattle safety issues has certainly been far, far better in the new facility than we could ever do in the old one.

                                    Relative to the rest of the operation out here, we've got what we call the Bluegrass regional marketplace; that's kind of the front end of the operation, the front building you come into on your way to the sales arena. That includes retail partners, a full-scale restaurant, a classroom with a certified teacher (and) museum content. And we've got about 15 to 20 other businesses that are located out here with us that are all agriculturally related (and) really create an interesting mix of goods and services that are all in one place.

Tom:                          So, who came up with that idea, to try to integrate retail — and events as well, correct?

Jim:                             Oh, you bet. You bet. Events are a big part of what we do. Meetings of all sizes, as well as several events that we put on ourselves throughout the year to educate the public, just create recreational opportunities and also drive business to these partners that we've got out here. You know, it was born out of a dream of the chairman of our board, Gene Barber. He talked for years and years and years about having kind of a one-stop shop for farmers where they could source their — buy their insurance, do their banking, all of those kinds of things, all in one location. As we got into this, the realities of the zoning and the type of building we could put up really didn’t allow us to exactly bring his dream to fruition, but out of that came this large building with multiple partners in many, many different aspects of the agricultural industry.

Tom:                          Well, Jim, some in the industry have been predicting that the influx of government money from pandemic-related programs — such as coronavirus (and) food assistance, the paycheck protection, the PPP and market facilitation programs like those — will have a lasting negative effect. Do you agree with that?

Jim:                             Well, you know, I don’t know about a lasting negative (impact). Farmers are farmers. You put dollars in their hands, they’re going to reinvest them, and they’ve done that with the CFAT money and the other monies that have been out there. We’ve seen — our market for high-quality replacement animals has certainly been really, really good here through the latter part of 2020 and the end of the early part of 2021. And I think that’s a reflection of that extra money that’s there in circulation.

                                    You know, the reality of it is (that) this has been an extremely depressed market for the last couple (or) three years, and that shot in the arm has probably kept some people in business that might well not have survived through this. And even with that said, we’ve dispersed a lot of cowherds during this period of time. A lot. And we’ve decreased this cowherd considerably here, in the state of Kentucky, and surrounding states as well, but I don’t think you’re going to see a lasting impact. You know, the culture of the cattle producer is not one of government dependence. And so, I think this one or two influxes of extra money are probably just going to help people improve their operations, improve their overall economic stability and, hopefully, keep them in business.

Tom:                          Let’s turn to meatpacking. There are just four major operations in the country, and I’m wondering if the meatpacking industry needs some diversification. What’s your opinion on that?

Jim:                             Huge topic in the industry right now. And yeah, there’s no question: we have both the transparency issue in our fat cattle markets and a competition issue in our fat cattle markets. You know, when you’ve got four major packers in the United States that control 80-some percent of the slaughter capacity — (and) two of those entities are foreign-owned, which further compounds the issue. And we certainly have some problems at the upper end of the production system in that meatpacking sector. And you know, more than 80% of the cattle that are going into packing plants today or are not being sourced through any system of open price discovery — they're under contract or, you know, other arrangements with feedlots, where those prices are set on those cattle outside of the open marketplace. Well, it trickles back down through the entire industry, because those packers are one of the few segments of any business that I know of that not only gets to set the price for their product going out the door, but they also get to set the price for their inputs coming in the door. It’s a pretty good spot to be in.

Tom:                          What about the rise in recent years of competitive and alternative proteins? What do you feel the beef business needs to do to stay competitive with that?

Jim:                             You know, one of the things that we saw during COVID, if you watched when the grocery store started emptying out: what emptied out first? You know, the meat cases were empty on the first day. (There were) a lot of pictures floating around of, you know, the meat case empty, and then the alternative products are never out of stock.

                                    We have a great product. We have a product that's in great demand, both domestically and in the export markets. I think we have to continue to improve our product and improve the perception of our production process in the eyes of our consumer. We can’t ever take our eye off that ball. We’ve got to continue to make steady progress moving forward of elevating not only the quality of the product itself but the perception of that product — nutritionally, animal husbandry, all of those factors come into play.

                                    You know, those alternative products are certainly a concern of a lot of people here in the meat industry. Personally, I think they’re somewhat of a niche market — maybe a large niche market for a growing population of people that don’t want to eat meat, for one reason or another. But at our current level of production, boy, it’s sure not been difficult to move this product. So, we certainly have demand. I think we just need to be cognizant of the fact that there is competition out there and continue to do the best we can to put a better product in front of our consumer.

Tom:                          Well, Jim, as somebody who’s been around the cattle business for a long time, what would you say has changed the most and why?

Jim:                             Because of what we’ve just talked about, you’re seeing more and more of the marketplace driven by data and information. It’s become more difficult for the smaller producers to participate in the marketplace. And subsequently, we’ve lost a lot of our smaller producers that were selling not necessarily a bad product but more of a commodity product into the system, (and) that was a big part of our business over the years in the livestock markets. And we’ve certainly had to adjust to make our sales relevant to those larger and larger producers that are more data-driven and more information-driven and provide value to them in our system. But you know, we typically are gravitating toward dealing with ever larger producers that are handling more and more cattle across the broader geographies and doing it with a lot more technology.

Tom:                          So, Jim, how long have you actually been in the cattle business?

Jim:                             I mean, I’m 56 years old, and I've basically been in the industry in one form or another all of my life.

Tom:                          Well, I’m just wondering: Any favorite memories from your time in the business? It's a lifelong thing, I know, but anything stand out there? The fire certainly isn’t one of them.

Jim:                             No. The fire is not. It is certainly a memory, but it's not a good memory.

Tom:                          Right. Right.

Jim:                             You know, as I look back over the years, you do have to love this business. If you didn't, you couldn't survive. Facing a lot of challenges along the way and surviving those challenges and going on to grow and be better, (and) the many, many just amazing people that are in this great industry — too oftentimes, we get hung up on a handful of bad guys out there, but the vast majority of the people that we deal with are just tremendous, salt-of-the-earth, honest people (who) are really dedicated to putting a good product in front of our consumers and doing good business. And I guess that’s probably the best memory for me, is just getting to know and dealing with all of those really fine folks.

Tom:                          All right. That’s Bluegrass Stockyard CEO Jim Akers. Jim, thanks so much for joining us.

Jim:                             You bet. Thank you.

Tom:                          And I'm Tom Martin, and thanks for listening to us.

Announcer:              Join us for the rest of this series as we reflect on how the agriculture industry adapted in 2020 and speak with experts on what's in store for agri-food in 2021. Thank you for joining us. Be sure to subscribe Ag Future wherever you listen to podcasts.

Have a question or comment?

What some may view as obstacles, Twig Marston sees as opportunities. The beef nutritionist from Hubbard Feeds joins to share his thoughts on the current state of the beef industry and why he is optimistic about the industry becoming more efficient and sustainable.

The following is an edited transcript of the Ag Future podcast episode with Twig Marston hosted by Tom Martin. Click below to hear the full audio or listen to the episode on Apple Podcasts or Spotify.

Tom:                          I’m Tom Martin, and for this latest conversation in our beef and dairy industry series, we’re joined by Twig Marston, a beef nutritionist with the Alltech division, Hubbard Feeds. Welcome, Twig.

Twig:                           Well, thank you, Tom. I’m glad to be here.

Tom:                          And let’s get this out of the way up front. I’m sure you’ve been asked this enough to roll your eyes every time it happens, but I’ve never met anybody named Twig. How did you come by that name?

Twig:                           My parents gave me that the day I was born. So, that’s on my birth certificate. And if you ask my mom and dad, if you ask them, “Hey, where did you get the name ‘Twig’?”, they’ll just laugh and never give you an answer. So, I have no idea where it came from. It’s definitely not a family name, but it’s one that sure stuck through the years.

Tom:                          Well, it’s a good one. It’s one that nobody will forget, that’s for sure.

Twig:                           It’s a little different.

Tom:                          So, Twig, your expertise is in beef nutrition, with focuses on improving the efficiency of beef production and increasing the demand for beef. So, let’s start with efficiency. What needs improvement in that area?

Twig:                           Well, I think, Tom, when we talk about efficiency, a lot of times, we’ll try to compartmentalize and look at, like, one phase of a calf’s life or one part of a cowherd — you know, pieces and parts. And I think, now and in the future both, we're looking more at a systems approach of, “Okay, if we change this and improve the efficiency of this part, if we interact with different parts of our production system — say, like the forage management or the grain management, along with the transportation management and the actual cowherd and the animals themselves — we can improve efficiency in a much better rate. Not better (just) in (terms of being) profitable or sustainable, but better in just everything that we put into the system.” And then, as we get along further and further, we can make more changes that will build on each other as we go.

                                    And so, we're looking for the intersections in the industry to make those. And I think, as we do that, one of the things that we do is in the system — I’m a cow/calf guy, so I like to look at, “Okay. How do I improve cow/calf efficiency?” And a lot of times, I’ll go to reproductive efficiency. And that’s intertwined with nutrition. And that's where my expertise comes in, is (in answering questions like), “How do we get cows in the right body condition score? How do we feed them the right trace minerals and vitamin packages? How do we give them enough protein that they can go out and efficiently harvest the forages that we make but, in turn, increase the reproductive efficiency, which actually gives us more sellable calves per cow exposed?”

                                    And then we take that even further as we wean that calf and go into post-weaning ownership and production. We look at, “Okay, how can we improve their rate of gain? How can we improve their feed efficiency?” And then we get to start finding things like genetics and all kinds of other facets of the industry that, you know — 20 years ago, we studied genetics, we studied reproduction, we studied nutrition. Now, we're starting to study all of them together. And together, we're making much quicker progress in increasing the efficiency and quality of our product.

Tom:                          Well, these are definitely the strangest of times, in recent decades, anyway. What's happened to consumer demand for beef during this pandemic?

Twig:                           When we talk about consumer demand, it shifted during the pandemic, but it stayed strong. And so, it’s changed from how people eat, or where people eat, or how they spend their food dollars, but one of the things that they've done to beef is they come back to beef time and time again as they look at the opportunities to include that as part of their meal, as part of the protein section.

                                    And I think the story, (over) the last 20 to 30 years, through different nutritional programs and different beef advertisements, has been the nutrient density of red meat. You know, what do you get out of red meat besides proteins? Zinc and iron and those things that help balance and make a good, healthy diet for the public. And I think, also, what we've seen over the year of the pandemic is changes in demand for exports, where our neighbors — whether they're across an ocean or connected to us on the North American continent — have continued to support the beef industry and their purchases of beef and beef protein products as we look out there.

                                    And so, as we look at the pandemic, one effect that it’s had (is) it’s changed the way we ate but also has not always changed it in a way that it’s hurt our business or shifted our business to other proteins. We remained strong throughout that. And I was just reading a forecast today that came out with numbers from November and December of last year, and they predict that in 2021, we're going to continue to increase the demand for beef and the beef products that we produce here in the United States.

Tom:                          The USDA is forecasting that meat prices will rise about 6.5% this year — more than double their usual rate. What's driving up those prices?

Twig:                           Well, several things are. One is they’ve just readjusted some of the numbers, inventory numbers, of the beef supply out there, and they have decreased not only the 2020 number of calves born in the United States but also the number of calves that were born in 2019. So, that's going to affect the number of cattle that we have available to market during the year 2021. Along with that, over the last 3 or 4 months, we've seen a steady increase in feed production costs. The price of corn, the price of soybeans — two of our major staples when we get to the finishing phase of the beef industry — have gone up dramatically during the last, like I said, 2 or 3 to 4 months, if we look back to those charts. And one of the things that tends to happen when feed prices increase is we'll have a lag in the cost of beef or the prices of beef, but then we'll see beef start to catch itself up with those higher prices. So, in the end, high feed prices produce high beef prices. And so, that will support those increases in beef cost that we see that will end up with the consumer.

Tom:                          Tracing those falling dominos backwards, we're now at the point of feed going up. What's driving that? What’s driving up the price of feed?

Twig:                           Several things are driving up the price of feed that we use in the beef industry. One is increased exports to foreign nations that want our grain supply. And so, they’re direct competitors with the feeding of livestock in the United States. Part of that is due to the supply that’s out there — the number of bushels that are produced not only in the United States but other countries as well — but also is the monetary policies of different countries besides the United States. And us devaluing our dollar through the last several months has made our products more valuable in the export market. And so, that's driven many, many countries to come to the United States and start to build their supplies to meet their demands and future demand from our grain supply.

                                    So, it's not just one thing. It's several things coming together. And it’s been very good if you're a grain producer. It's made your life a little more complicated if you're a livestock producer.

Tom:                          What about consolidation in the packing industry? Is that trend having any impact on pricing?

Twig:                           It has in the past, probably. I mean, there's no denying that we had more packers several decades ago than we do now. But really, the packer consolidation hasn’t changed much in the last 20 to 30 years, at least. The same big players are the same big players. Yeah, maybe some names have changed, or they’ve switched some divisions, or they've added to their companies, but we still have about the same number of large packers out there that we had before. There is some consolidation always going on in the medium-sized and small packing industry. And so, that will have some local and regional effects. But overall, I think consolidation doesn't drive it, except those companies now have different points of leverage as (they) look at supply and demand.

                                    I think really it gets back how many pounds of cattle are out there for the packers to harvest and how many pounds can they deliver out of their harvesting efficiency to the public and the products that they produce. And so, that pendulum swings back and forth between who has the leverage in the supply and demand markets out there, between the producers and the cattle raisers and those packers. And of course, there's times when one will have an advantage, and then that pendulum will swing, and the other side of the equation has an advantage.

And we've seen, since the pandemic — first, there was a fire at one of the major packing plants that reduced packing capacity. And then, with the pandemic coming, with COVID coming in and reducing the size of the workforce at times, we've seen a decrease in the ability to produce, and that caused the backlog (of) cattle. And so, that wasn't anyone's fault. It's just the way things happen. And so, now, we've had to live through that, and I think we're now getting on the front side of the whole packer supply. And so, I think we'll see a shift now, as we go forward. And we’ve seen that shift, I think, in the last month or so.

Prices may not have always been what producers wanted, but they did stabilize. And at times, we see some pretty bright spots. And then we look at futures and different abilities to manage our risk in the future, and we see some opportunities for some profits as we look out in the front months.

Tom:                          Okay. Change of subject. What trends are you seeing? What's happening with all-natural and niche market programs? What's going on there?

Twig:                           What we see out in the country is more and more interest in those.  They’re still a small but a growing part of the beef production systems. Producers are much more comfortable about what the rules are and the production practices that need to be put in place, the affidavits or certificates of production, to make sure the products meet specs and those kind of things. All those are becoming more and more acceptable — or at least knowledge about that, so you know where you're at, you know what your opportunities are on the production side.

                                    I think, on the other side, on the packing industry, the fabrication and the retail sales, they are finding more and more ways to identify their brands and to advertise and present those brands to the public, to show their advantages. And I think that part of these natural markets — it was kind of the chicken and the egg. Which one do you need first? Do you need more pounds of natural beef, or branded beef and a certain product, or do you need the market out there to pull that through? And I think we found that there's a balance there and that, now, the pull-through is becoming slightly larger every day. And so, we see more and more opportunities when we get to those different kinds of branded products that we can present to the public.

Tom:                          The new Biden administration is much more aggressive on the matter of climate change and reducing greenhouse gases that contribute to it. And I'm wondering: Do you see a role for the feed industry to play in that effort?

Twig:                           Oh, yes. I think we’ll be front and center in that opportunity. I think some can look at climate change and greenhouse gas production and environmental sustainability, those kind of things, and they can look at them as problems, or you can turn the table around and look at them as an opportunity. You know, what can we do if we're in the production system? What can we do to do that? Can we be more efficient in the production of the crops and the forages out there so that we have a large role to play in carbon sequestration back into the soil? Is there a way we can play a bigger part of the natural carbon cycle, where CO₂ or greenhouse gases are produced in our production system but we can return them back to the natural carbon cycle, back into a healthy soil, and start that cycle to where we don't have a buildup, or a dam, or a barrier from that cycle from taking its place?

                                    And so, as we learn more and more about how we can enhance those abilities, we can take more and more responsibilities of helping other industries out there that don't have that opportunity to enter the carbon cycle as easily as we do. And so, I see it as a great opportunity for us in the beef industry to help not only our country but the world get the control of climate control and of carbon production or atmospheric carbon and get it back into the soil. I see that as a major focus that we have in the future. And I see it as a huge business opportunity for the industry as well.

Tom:                          Well, Twig, are you seeing developments or trends in the areas of research and innovation that are especially interesting to you?

Twig:                           Yes. I like to keep up with journals and the research journals and see what's cooking out there, what the young minds and the old minds are putting together and how they build science and what science has to do with improving our product, the production of beef and the food that we provide for people.

                                    I mean, really, when we get down to animal agriculture, whether we’re in the beef industry or the swine industry, we’re in this business to feed people. I'm always interested in those opportunities where we can improve the quality of our product, improve the safety and wholesomeness of our product.

                                    I look for intersection. Some of the intersections that I'm quite interested in (are) the intersections between genetics and production — say, like nutrition or reproductive physiology. In genetics, we’re fine-tuning more and more of being able to predict what animals can do and what they can't do and then using that to enhance our production system so that we know how to feed this kind of cattle, where we can improve our feed efficiency with different types of diets that we might feed them. So, it's an intersection of different disciplines within the industry.

                                    The other part of research that I really enjoy reading is research that has nothing to do with beef. You know, we’ve got some exciting things that the world is learning about viruses and learning about climate, learning about social behaviors, learning about all those different kinds of things. And that's where we're going to find the intersections, I think, that advance science. You know, if everybody just studied beef, we’d have great beef, but we’d be leaving out other parts of our society that we can make improvements on. Maybe if we’d look at biosecurity and those kinds of things in the beef industry, we can use that biosecurity to predict our human population as well. And so, I always look for things within my realm, and then I try to reach out and look at things that are kind of off the charts and say, “That's pretty interesting stuff.”

Tom:                          Yeah. In a previous interview that we did, we heard about tomato farmers in England who figured out how to make their packaging, their crates, out of tomato vines, which was pretty interesting stuff. And that's kind of the thing that’s going on, isn't it?

Twig:                           Well, yeah. I mean, we’re finding different ways to prolong the shelf life of a product, to reduce the injury, so that we have less waste. You know, one of the big things in food production is waste, even though we have part of our population that needs more food that is not readily available to them. If we look at the amount of food that either spoils or doesn’t get transported right or doesn't get portioned right, we could capture that waste back and make our product more available and can get rid of some of the food deserts that we have out there across the world.

Tom:                          Have there been any recent tweaks or updates to the Blueprint feedlot or seed stock programs?

Twig:                           Oh, yes. That’s the beauty of the Blueprint program, is it's an evolving product line. We started out with basic cow mineral nutrition, mineral supplements that went straight to cowherds, and then we started kind of another set, for the growing and finishing phases of beef production. Over these last 6 months, we’ve stepped back and really looked at those opportunities, that the whole production system could benefit from the use of organic trace minerals, the use of feed additives like Bio-Mos 2 and Integral and some of those products that we know can really aid in the production of beef. And so, we started to incorporate them and looking at the different phases but then putting, like, a lifecycle into the product line to where it just all fits together.

                                    It’s been a great product and a program to work with. We’re getting some exciting results and great testimonials from producers that have been with us for 3 years (or have) been with us for 3 months, you know, about how well the product is used. That not only gives us or makes us smile about we know we have a good product, but it also stretches our imagination of, “Where does this need to go next? Where are we headed to? How can we make this even better?”

Tom:                          Well, you’ve mentioned opportunity a couple of times here, and I just thought we would wrap up by asking you, in a broad sense, what opportunities should producers be keeping their eyes on?

Twig:                           Some people call opportunities problems, and I try to always turn it around and look at problems and turn them into opportunities. But I think if I was a producer out there and I was looking for opportunities to stay on top of my game, the first thing is I would stay informed. I would watch the world, I would watch my business, and I would watch my community and try to learn every chance I could. I think being a lifelong learner is a very, very important part of being a successful beef producer and a successful part of the ag industry.

                                    And the other thing is to stay alert. I think one of the things that can happen to us when we're out there in the production phases of our industry is we've made a widget, and we just keep making that widget, and we don't think about the other opportunities that come along. And so, I think we need to stay alert and look at the different opportunities that come along.

                                    I mean, who would have thought that — you know, one of the things that we say about beef is (that) the only thing that we waste on a beef animal when we harvest it is the balls. We make some of the finest paint brushes in the world out of the hair that’s in the ear of a cow. We used to be used for almost all the insulin production until recombinant DNA was used to produce it artificially. I think we always need to continue to look at those opportunities of how we can better raise our product, how we can increase the value of our product, and what can we make of higher value that can better people's lives with what we do as beef producers.

Tom:                          Well, it's also interesting. It’s Twig Marston, a beef nutritionist with the Alltech division, Hubbard Feeds. Thank you, Twig.

Twig:                           Thank you.

Tom:                          Join us for the rest of this series as we reflect on how the agriculture industry adapted in 2020 and speak with experts on what's in store for agri-food in 2021. Be sure to subscribe to Ag Future wherever you listen to podcasts. And I'm Tom Martin. We thank you for listening.

Evelyn Greene, president of American National CattleWomen (ANCW), joins to discuss her work uplifting the beef industry, promoting sustainable beef production and encouraging more women to carve out careers in the agriculture industry.

The following is an edited transcript of the Ag Future podcast episode with Evelyn Greene hosted by Tom Martin. Click below to hear the full audio or listen to the episode on Apple Podcasts or Spotify.

Tom:                          Welcome to Ag Future, presented by Alltech. Join us as we explore the challenges and opportunities facing the global food supply chain and speak with experts working to support a Planet of Plenty.

                                    I’m Tom Martin, and for this first interview in a series about the ruminant industry, I’m joined from Auburn, Alabama, by Evelyn Greene. Born and raised on a farm that included a beef operation in the largest beef-producing county in Alabama, she has been managing her family farm’s row-crop and cow/calf operations since 1982 and has, for 25 years, been an advocate and promoter of the beef industry.

                                    Today, Evelyn is president of the agricultural grassroots organization American National CattleWomen, an organization with 27 state affiliates across the USA.

                                    Welcome to Ag Future, Evelyn.

Evelyn:                       Thank you so much, Tom, for having me on today. It’s a pleasure to be with you.

Tom:                          And first, tell us about the organization that you lead.

Evelyn:                       Yes, sir. The American National CattleWomen is a voice for women who share a passion for the base community with the focus of beef promotion, education and legislation.

                                    The American National CattleWomen’s association is a grassroots association with a tremendous history, with a shared passion and shared voice. We have a successful record of positively promoting beef and the beef industry. And in 1952, CattleWomen had the foresight to organize their individual messages into a strong national voice, which is now the American National CattleWomen’s association.

Tom:                          At Alltech, we talk often about our vision of a Planet of Plenty, our belief that agriculture has the greatest potential to shape the future of our planet. And I know that your organization also educates about and promotes the beef industry’s positive role and sustainability.

                                    Can you share with us some of the ways American National CattleWomen is advocating for beef producers?

Evelyn:                       Yes sir, Tom, I would love to share with you my visions on that. With ANCW, the American CattleWomen, as president in 2020 and now, in 2021, the promotion of our next year is going to be about the generation. And my theme has been “beef for generations,” and this theme merges with the Alltech vision of a Planet of Plenty. And (for) CattleWomen, our goal is to set the stage for providing a healthy, wholesome and high-quality protein for a growing world population, utilizing beef as our foundation.

                                    And beef contains high-quality protein with (the) essential amino acids needed for a growing human population. In addition, it is loaded with an abundance of nutrients that make our daily nutrient allowances. It is well-known for its supply of zinc and (the) essential minerals necessary to carry out our body processes and includes immunity as well as iron that is, essentially, especially needed for women, in our daily diet. Lean beef is a very wholesome, certainly tasty selection for feeding your family in this day and time.

                                    Our association works extremely hard in providing factual information about the beef and (its place) in the diet. Additionally, we deliver quality programs for women working in the beef cattle industry. One of our programs that we have highlighted in this series (is) our WIRED program; it’s called Women in Ranching Education and Development.

And also, our K-12 programs for youth, and this plays a significant role in the development of our next generation. We focus on both youth and collegiate (students) in the training. We have a collegiate beef advocacy program, and the work that each state affiliate plays in their local youth programs played back into the factor of this for the American National CattleWomen in being an advocate for our industry.

Tom:                          You know, Evelyn, you can’t talk about anything these days without bringing the pandemic into it somehow. So, let’s bring that into the discussion.

                                    Are strategies in play to get the meat-packing industry back in full force while, at the same time, providing a safe and healthy working environment for the people in the industry?

Evelyn:                       Tom, like all other major industries, the pandemic created chaos (for us) all across the U.S. Restaurants closed, reducing (the) consumption of beef while dining out. Consumers begin buying beef and meat from the grocery stores all over.

At the same time, when we transitioned to social distancing in our harvest facilities for the employees, safety broke our link in the supply chain. So, this link has been reconnected, and today, I believe it has made our supply chain, the beef supply chain, much stronger.

                                    And before the pandemic, we would have never ambitioned a collapse like we have experienced. But today, all segments recognize the possibility and have become very innovative and forward-thinking to continue what we do best, and that’s to provide high-quality protein for the table.

                                    The meat-packing harvest facilities were hit hard simply because of the volume of beef that must move through our facilities while maintaining a safe environment for the employees. So, our harvest facilities are essential, and their primary focus is to maintain worker safety. Without healthy employees, the supply chain stalls. And they are the bread and butter for our success.

They are working closely with the health officials, developing employee programs to meet employee needs during this crisis. And harvest facilities are now meeting the demands of harvesting cattle that are ready for the market and ready to eat.

Tom:                          Have you noticed any changes in beef consumption over this past year, during the pandemic?

Evelyn:                       Well, Tom, people must eat, so obviously, when grocery stores’ shelves were empty, people really struggled. But that was the same for all perishable foods.

And I believe it’s the greater emphasis we placed on how to manage the flow of perishable food, especially our meat products, in the future, as we problem-solve and evaluate the effective — and how it, how we handle this pandemic and have a food supply.

Tom:                          Meals at home: Is this an opportunity to get beef more present on the home menu?

Evelyn:                       Well, Tom, this is where the American National CattleWomen really feel at home. We have worked hard over the years to educate the family on safe and tasty food preparation at home. And in today’s lifestyle, this often includes quick meals for the family that provide high nutrition and nutrient-rich foods like beef.

                                    We have connected with collegiate groups all across the U.S. to train these young minds in how to prepare a quick, easy, nutritional beef meal for their families and for their peers on campuses or even at home, while they had to be at home during COVID.

Tom:                          Of course, COVID has really impacted in-person gatherings, and I’m just wondering if that’s having a big impact on national cattle meetings this year going to go virtual, or if there are plans to eventually gather in-person.

Evelyn:                       As we’ve seen this past year, we have had (to) transition into virtual meetings. The face-to-face meetings are happening in some parts of the country, where it can be done safely.

                                    Me and my husband recently attended the Missouri Cattlemen and Cattlewomen’s annual convention, and it was a face-to-face environment.  We did practice the social distancing and wearing our masks and sanitization for our hands. But I’ve also traveled to (the) Oregon Cattlemen and Cattlewomen’s convention and also Denver for meetings, and it was safe. I see no problems. We just made sure that we were doing the recommended safety social distancing and wearing our masks and sanitizing our hands.

And I believe we will continue to use a hybrid model of meetings, with some being face-to-face and others still being virtually, as we continue to work through this pandemic. Certainly, the implementation of the vaccine in 2021 will definitely help return to us a new normal.

Tom:                          The new Biden administration is moving pretty aggressively against climate change, with a variety of approaches to reducing greenhouse gas emissions. And just today, the day of this interview, General Motors announced that they’re going all-electric by 2035. And I imagine by the time that this podcast reaches our listeners, others will have followed suit.

                                    I wonder if you envision the beef industry supporting this drive to cut the American contribution to climate change.

Evelyn:                       Tom, you know, as we look forward, we are looking forward to working with President Biden and his administration as they recognize the positive role agriculture plays in addressing climate concerns.

                                    U.S. cattle producers are advanced. They have advanced technologies and genetics in grazing management to make their herds more sustainable in the world. And I think we appreciate the outreach and opportunity that we’ll have to provide feedback and demonstrating what U.S. cattle producers are, and they are role models for the globe and for sustainable beef production.

                                    And I think, today, it will be one of our benefits to be able to allow that, to be recognized as a positive role in agriculture. Most scientists recognize climate change as something that is very real. And I believe the beef industry and all of agriculture supports effective and realistic change that is balanced and well-thought-out.

                                    But however, when we make changes, legislations, laws, without fully weighing all the ramifications of those changes, it is very possible to do more harm to our society and future societies. We must realize that every action has a reaction. And sometimes, I look at legislation that has been written, the laws that are made, and statements made by politicians on both sides of the aisle and just sort of kind of shake my head in amazement.

(Using) logical and common sense while weighing the scientific facts is the best way to go, Tom. I’ve always believed politics has, sometimes, has a place but really doesn’t have a place, if that makes sense.

Tom:                          [Laughs] It makes sense. It makes a lot (of sense) to everybody, I think.

Evelyn:                       Yes. And when I hear some of the suggestions in climate legislation that are related to greenhouse gases, I’ve always said, “You know, be careful what you ask for, or you might just get it, and the outcome will be devastating.”

So, we have to be careful what we ask for. And the reason, you know, this is, we have — even like today, with the cattle grazing on grasslands that are not, they say, is not conducive to any other parts of the greenhouse, and we have to be careful with that.

These are valuable assets to our industry in a sustainable future, and the ruminant animals consume food products that are not directly consumed by humans. So, therefore, that converted that product to (the) tasty, edible beef that we enjoy.

So, we transition to the production of large qualities, you know, alcohols from fuel in our vehicles in the 1990s, and this process generated millions (of) tons of corn distillers grains. And without animal production, this organic material would be put into waste dumps. So, there is another way of looking at how this will be beneficial to our agriculture in the beef industry.

Tom:                          There’s a twist, or a wrinkle, whatever you want to call it, coming from across the Atlantic in an interview — in our previous interview, actually — about the European Green Deal and how that’s bringing changes to farming in Europe.

                                    We heard that there’s a push — in Europe, at least — toward changing diets to more plant-based versus meat-based. Do you see that happening in the U.S.?

Evelyn:                       This is a very interesting aspect, Tom, and I appreciate you bringing it to light, especially with me working with the beef industry. We must make sure that people continue to consume a healthy and nutritious, rich diet.

Much of the push for this in Europe, as well as the U.S. and other parts of the world, is based on false, opinionated and biased information, in my opinion. And I believe it was maybe, I believe, [Dr. Kim Polgreen] that said, “If we don’t eat beef, then the only role for cattle would be to (be) found in the zoo.” So there, again, if we don’t use cattle to convert non-edible products and possibly to put in a human diet, then we lose a tremendous opportunity to feed the world population.

I do believe that our generations to come (will) move into the future with food security, (and there) will be significant problems. And this doesn’t make sense, to take animal products off the plate. It doesn’t (make sense to eliminate an industry) that provides a nutrient-dense food when I face a depletion of food in the future.

If we thought about COVID and the creative problems that we have, we need to realize that there is no vaccine that will ever be able to overcome the devastation of food insecurity in the world. You know, the Green Deal is a great example of “be careful what you ask for”; the ramifications to society are great.

So there, again, I think we have to be mindful of what we are (serving) as nutritious, rich proteins in our diet, Tom.

Tom:                          Okay. Well, let’s come back to your organization and what it’s been about since 1952, really, and (you are) probably realizing it now in this era, and that is women taking more leadership roles in the beef industry. Is that happening?

Evelyn:                       Yes, sir. We’ve had women in agriculture all across the U.S., like you said earlier, in our 27 affiliate states. And women are playing many important roles in the support of food production and education for the global population. And women are rolling up their sleeves and getting to work on their farms and ranches all over the country and the world.

                                    United States Department of Agriculture statistics show that 44% of American farmers and ranchers are women, Tom. This — agriculture, in the process, has a $12.9-billion impact on our economy. Yes, women are very important in agriculture, I would say.

Many more women support the global food crisis through education and promotion. And the American National CattleWomen Association plays a critical role in both (the) production and promotion of the high-quality food protein of beef and cattle.

                                    The American National CattleWomen is, you know — we’re strong, enthusiastic women, and we’ll stand behind what we believe in. And a lot of women run ag operations, and we’re proud to say that, Tom.

Tom:                          What is your best advice, Evelyn Greene, for a young woman who’s interested in pursuing a career in the beef industry?

Evelyn:                       This is always one of my favorite questions to answer. I love working with youth and getting their minds going about the industry and what it means.

My foundation, it was filled with American values, like hard work and (the) importance of family, loyalty to God and our country, and a rugged determination to persevere. And to me, the beef community is a snapshot of all things that have made America great. And I have ultimately succeeded in the face of all kinds of adversity with my foundation, from my family farm, and that is how I decided to work in the beef industry.

                                    But a few pointers I always like to give would be to pursue an agriculture or animal science, meat science or business degree. Have some hands-on (experience in the) nature of instruction, and the need for networking as a skill, which then creates opportunity for future research.

                                    Develop a professional network. That’s very important. And I always say, “Do not box or step into your home county or home state; be ready and available to seek opportunity all over the United States.”

                                    Another aspect I always like to tell them (is) if you love what you do, then you will always want to go to work. And it is an amazing and rewarding adventure to be working with the Cattlewomen in this day and time.

Tom:                          That’s Evelyn Green. She is president of the agricultural grassroots organization American National CattleWomen, and she talks with us from Auburn, Alabama.

                                    Thank you, Evelyn.

Evelyn:                       Thank you, Tom. It was a pleasure being on today.

Tom:                          Join us for the rest of the series as we reflect on how the agriculture industry adapted in 2020 and speak with experts on what’s in store for agri-food in 2021.

                                    Thank you for joining us. Be sure to subscribe to Ag Future wherever you listen to podcasts.

Minette Batters represents the interests of 47,000 members of the National Farmers’ Union of England and Wales (NFU) as the organization’s president. She joined the podcast to discuss protecting farmers through agricultural policy, farm innovations that will lead to more sustainable food production and why she is hopeful about the future for farmers.

The following is an edited transcript of the Ag Future podcast episode with Minette Batters hosted by Tom Martin. Click below to hear the full audio or listen to the episode on Apple Podcasts or Spotify.

Tom:                          I’m Tom Martin, and joining us from her farm near Salisbury, Wiltshire, for our Agri-Food Outlook series is Minette Batters, president of the National Farmers Union of England and Wales. Her organization represents the interests of 47,000 members.

                                    Greetings, Minette.

Minette:                      Hello.

Tom:                          So, let’s begin with a little bit of background. You grew up on a farm and were discouraged from becoming a farmer yourself. You went on to catering for a time, but as they say, you can take the woman away from the farm, but you can’t take the farm out of the woman. So, you returned to farming a couple of decades ago and you haven’t looked back. Can you tell us about that personal connection with working the land?

Minette:                      Well, I’ll try to sort of sum it out, really. I mean, I was brought up on the farm that I now farm on and live on. But my father was, as you say, quite opposed to women going into farming. But it was definitely something that I always wanted to come back to. And so, two decades ago, I did manage to get the chance to come back here.

We don’t own this farm here, which is quite common in the United Kingdom; we have a lot of tenant farmers, which are basically long-term farm business tenancies. And so, I was able to negotiate a new deal with my landlords, and that was basically about doing up some cottages in return for the land that went with it. So, that’s what we started with 20 years ago — very little stock on the place, no fences, no farm buildings, a lot of modernization needed.

                                    And I guess my background — I trained in London as a chef — it came in really useful because I was able to keep that business going, and that very much helped us reinvest in what was needed in the farm. And now, we have a herd of pedigree Herefords and pedigree Aberdeen-Angus, which will be a breed that’s well-known to you.

                                    And we have wedding venues as well, so it’s pretty busy here on the farm — and it’s a very different farm to the one that I took on all those years ago, and I’ve never regretted it; I never looked back. And (I’m), you know, living the dream, effectively, as they say.

Tom:                          And so, you bring to your role with the National Farmers Union experience on both ends of the supply chain: from farm to kitchen, to your work as a chef.

Minette:                      Exactly, a lot of experience. And I think those come in very useful now, really, for us as farmers and as a farmers’ union. We’ve very much been trying to make the case for farming policy here through the lens of food, through the lens of what we eat.

                                    We have a lot of people here in the U.K. — nearly 70 million people on a relatively small island nation — so it’s a very important food market, and my job, I guess, as the president of National Farmers Union, is to keep our farmers and growers here the sort of number-one supplier of choice to the U.K. market, both at retail and at home.

                                    So, it’s worked well, I think, for me to have a background, you know, (in) both ends of the value chain, really.

Tom:                          What are your priorities in your work with the National Farmers Union?

Minette:                      For us, it’s a very different time right now. We’re obviously leaving the European Union. We’ve left, effectively, and much of (our) trade with them has been important. We now are setting out on a very different pathway for agriculture.

                                    So, we’ve just had legislation passed here. The last agricultural act was in 1947, and then, in 2020, we had the second, effectively, agricultural act. So, that will create a lot of change for the farmers I represent.

And, of course, you know, leaving the EU was all about wider trade opportunities. So, the U.K. and the U.S., the U.K. and Australia, all the Commonwealth countries, obviously, those trade discussions are ongoing. So, for us, it’s very much looking to the future, the role of farmers in delivering on climate change.

I do think it’s an exciting time, actually, to be a farmer. The challenge of continually mining things, effectively, out of the interest in agriculture, where we can grow things in a sustainable way on the earth, not only in what we eat but how we live our lives, is a massive opportunity for farmers across the world. So, I’m hopeful.

We host the cup here in November (and) the most important (UN) climate change discussions, and President Biden is coming in. Obviously, the U.S. is back at the table. So, for us, it’s all about future policies for trade, for how we produce our food, and really making sure that our farmers are seen as the solution in climate change.

Tom:                          2020 was quite a tumultuous year, and all of that has remained with us as we begin 2021. And so, let’s begin with Brexit. I think you touched on a couple of these things, but the United Kingdom formally withdrew from membership in the European Union at the end of January 2020. And there were to have been negotiations on the terms of the future relationship between Britain and the EU, including trade and economic relations.

So, if you could, bring us up to speed on any agreements in areas that impact agriculture and food production and marketing.

Minette:                      So, trade with EU was always a really important thing to get agreed and to make sure that it is tariff- and quota-free, which it is. So, that has happened, but the EU has always been about the single market.

                                    So, what I mean by that is a comprehensive set of standards that are all agreed by member states on how we trade. So, we were our part of single-market and the customs union, which allowed us to trade, effectively, tariff-free.

                                    This is a very different trading relationship. It is a sort of traditional FTA agreement. There will be friction, (and) friction equals cost, so we do anticipate (that), and there is a level of friction and that level of cost. But what has been ratified here in the U.K. is being called the trade cooperation agreement between the U.K. and the EU.

                                    I think that will be, to a certain extent, an iterative approach. It is without a doubt going to change, and it’s the start of a new relationship. But, for us, it’s 500 million consumers on our doorstep. It remains our key export market — 95% of our goods go into the EU. And, of course, 40% of our import is coming from the EU.

                                    So, it was vital for both sides, really, that we agree (about) that new trading relationship. And as I say, we are now having trade discussions with other countries, the U.S. included. So, it’s a very different road that we’re on.

Tom:                          Climate change is on everybody’s mind right now. The EU Green Deal is a very ambitious plan to become the first continent in the world to become carbon neutral by 2050. Will Britain be a party to the Green Deal, and if so, what are the implications for farming and food production in the U.K.?

Minette:                      Well, Britain won’t be a part of the Green Deal, but it has set its own ambition and, indeed, legislated on that ambition with the Climate Change Act to achieve net zero by 2050. And for us at National Farmers Union, we see this as a real opportunity and, indeed, we set the marker down, if you like, to achieve carbon-neutral food production by 2040.

                                    Now, that was primarily because agriculture is a source of emissions — currently, 10% here in the U.K. — but it is also a sink. So, it has the unique capability that other industries don’t have of being able to do something about it.

So, we don’t believe we need to downsize livestock farming to lower methane. We believe that, with the right policies, we can farm smarter — (we can be) smart, farm more efficiently, decrease our food production footprint, but still be producing the same amount, or potentially more.

                                    So, we see climate change, for farming, as a huge opportunity to drive forward. So, that has been our focus. My focus, in particular, is making sure that my farmer members are not taxed in all of these.

So, I don’t think we’ll necessarily be in competition with the EU, but we share the same vision, and I know — you know, many farmers I speak to in the U.S., you know, they’re doing a lot on climate change. And I think the world’s consumers expect us to be able to get to a carbon-neutral position, but this is, I think, the exciting thing for agriculture: that we can produce things only in a sustainable way, whether biodegradable latex or whether massively reducing our methane. But, you know, we can do it in a way that others — other sectors, other industries — can’t.

Tom:                          I’m wondering if that imperative to become carbon neutral often drives a lot of innovation? I’m wondering what cool things you’re seeing happening right now in farming in service to meeting that goal?

Minette:                      Oh, you know, you’re so right. It does drive a huge amount of innovation. And we’re seeing now, here, the ability — tomato growers that are producing tomatoes are able to make all of their packaging out of the tomato vines, so you create a totally secular economy. So, the cardboard packaging is made out of the vine, and the film that goes over the top of it is made of the vine. And the good thing about that is, when you throw it away, the whole thing biodegrades.

                                    We’re seeing a lot of progress being made in natural fibers — the opportunities of growing milkweed, producing biodegradable latex, focusing on sheep’s wool to make tree guards. We have, in the U.K., often — and I’m sure you have got plastic tree guards that (are) just left lying around forever (and are) totally unsustainable, not biodegradable, and sheep’s wool is fantastic, going back into the soil and providing nutrients, and it biodegrades as well.

                                    So, we’re seeing enormous changes in innovations that are driving these, these new outcomes. And I think we’re only just touching the sides of it at the moment. I think the opportunities are enormous. We’ve got to make sure the value of all of these things goes back to the farm gate. I think, as farmers, we’ve always been very good at creating these massive opportunities, at lowering food prices. And then, of course, we see decrease, decreased value at about (the) farm gate. We’ve got to make sure that the value gets back to the farmer with all of these new opportunities.

                                    We’ve also seen, with methane reduction, we’ve seen enormous benefit with feed additives. So, feeding micro algae and things like that to dairy cows, lowering methane but keeping the same amount of milk yield — again, taking protein is being fed down, but with the right feed additives, keeping the milk yield the same.

                                    So, we see it as an exciting time and a real opportunity to influence (farmers) globally as well.

Tom:                          I guess where there’s a will there’s a way, isn’t there?

Minette:                      Yeah, exactly that, exactly that.

Tom:                          Minette, in an interview that you did for the BBC’s Desert Island Discs — and by the way, we recommend giving that a listen; just Google BBC Desert Island Discs — it’s mentioned in the interview with you that while 70% of British land is agricultural, many British citizens kind of feel estranged from the people who grow and produce their food. Does that mean there’s a need to improve that relationship in some way, and how would you do it?

Minette:                      There is a real need to produce — to increase, I guess, the relationship between producers of food and the people that consume it. And I think, in the U.K., we’ve seen a lot of people leaving the land and going into cities, into urban areas, and that has created many challenges.

                                    You know, we used to, in the summer holidays, which were long, that used to be sort of — people could go out and do the harvest and pick the fruits. And we drove everybody, effectively, into the cities to upscale, to get to university, to go away from those jobs. And of course, then, (we) became very reliant on a workforce that has to come in here. So, in all of that, we’ve created more and more disconnect from the land and from the food that’s produced. So, this is why we continue to talk so much about food rather than farming.

We had a big campaign last year (that) had the sort of best chefs in the country. We had Jamie Oliver, who’d be known to many. We have Raymond Blanc and others who were all talking about provenance, about the need to buy British, to buy local, and that was really successful.

                                    So, I think we need to be doing other solutions toward this, much more of that — really building the connection between provenance and health. I think we tend to talk about food, and we forget that, actually, we are what we eat. And COVID, of course, I think has really brought home to so many of us the importance of a healthy, balanced diet, of getting back, wherever possible, to eating whole food (and), possibly, less processed food, but eating whole foods with all the nutrient values that we need.

Tom:                          You mentioned COVID. In what big and important ways has the coronavirus pandemic impacted agriculture and food production in the U.K.?

Minette:                      COVID has been a massive, massive game-changer. And what happened was 50% of our market, our food market, is retailed by people (who), you know, go and buy their food, come home and cook it. But 50% of our market was out-of-home, so it’s food to go (to) restaurants, hotels, hospitality (and) sporting events. That would be a big part of the market.

                                    And of course, when we had lockdown in March last year, that market just stopped overnight. All our garden centers were shut, so for the growers that rely on Easter as a massive part of what the season is growing for — people plant their gardens up at Easter — they lost all of those opportunities.

                                    So, we saw some sectors (that were) really, completely obliterated. And the big challenge, I think, (that) we faced as farmers was the fact that we couldn’t furlough — in this country, we’ve been furloughing our workers, or paying for people to be out of work, and you know, big businesses (have) been able to lock their doors and leave them. You know, we had a perishable supply chain (and) couldn’t furlough our cows, couldn’t furlough our workers. And there were big losses, but it’s incredible how things have changed, and now, people are buying at retail very much how they would have eaten out (to cook) at home.

So, it is almost balancing out, and prices, at the moment here, across most sectors, are holding up, whereas in the beginning, we just saw enormous turbulence. We saw people panic-buying, so we saw a lot of empty shelves, and that created more panic. So, every time we go into a bit of a lockdown, then you see people panic-buying, and of course, that is disaster because the moment that starts, people just panic more.

So, it’s settled down a lot, but I think there’s been a lot of lessons learned on the back of COVID, and not the least that, you know, we shouldn’t take our food or our farmers for granted.

Tom:                          What about disruption at the border due to COVID-19 restriction? Does that remain a concern?

Minette:                      It’s created quite a lot of concerns and quite a lot of challenges with Europe, because we work on a sort of “just-in-time” sourcing, and trucks come in here, they load up and they go back out again. And there is, as I said at the beginning, the restriction there, so that’s not working quite as well.

                                    And, you know, when we get problems at the border — and we’re seeing, now, restrictions on people traveling in. That side of it seems to be working okay, but I think it just depends how things go as far as goods go and imports go. It just depends, really, what happens. I mean, there are problems, but they are not nearly as bad as they were. And hopefully, things can, you know, return to a level of normality. We’re seeing, now, the vaccination program getting rolled out. And I hope, by the summer, that we can have a sort of new normal for us to return to.

Tom:                          More than a million people signed a petition that demanded assurances that British standards will not be undercut in any future trade deals. What’s the larger story behind this outpouring of sentiment? What is the message?

Minette:                      This is a difficult one, really. We had to — as farmers, all of us produce to very high standards of regulation, whether that’s animal welfare, whether that’s environmental protection or food safety.

                                    And this is very, very different in America, where you have huge differences. You know, in California, you probably have higher standards than you have in many parts of Europe. But in the U.K. — that is, a smaller country — the laws on how we produce our food are very strict. And so, we’ve driven these high standards of animal welfare, which limits, you know, how many birds, say, you can keep in a shed, (or in a) pig cage, that you have to have windows in that shed. (The law) dictates that you have to have high security measures in place.

And so, our line was, you know, in trade, we are absolutely out for trading with the rest of the world, but we’ve got to try and have a common approach here that is basically fair. You know, it’s fair to farmers in other countries and fair to farmers here.

So, that was the whole reasoning behind it — because, of course, we had, in the run-up to Brexit, a lot of politicians saying the big cost of Brexit is (that) we’re going to get cheaper food. And our line was, actually, that job was being done. You know, we are very close to the U.S. — I think it’s the U.S. first, Singapore second, and U.K. third in (terms of the) affordability of food.

So, I think, for all of us as farmers, whether we farm in the U.S. or here or, indeed, in Europe as well, you know, we want to make sure that farmers stay in business and that we have fair approach to trade. And trade is a good thing for farmers across the world and, you know, just the farm in Africa and breaking to help African farmers trade.

So, we want to be trading tariff-free, without a doubt, but we want to try and have a common (and) fair approach to how we trade, and that really is what the petition was about. It was just really saying, “Do not undercut our farmers by tying their hands to the highest rung of the ladder and allowing imports in that don’t eat meat, the bottom rung of the ladder, which would just put our farmers out of business.”

That — that was really the driver behind that petition, and as I say, we had a million people, and so, that’s really just one in 60 people in this country saying that was what we wanted to see. So, it was one of the largest petitions ever, and it was really powerful.

Tom:                          Minette, you are quoted in an article for Southwest Farmer as saying, “The new year sees the government implement its own agriculture policy for the first time in 70 years. It will see a seismic shift in the way farming is supported with renewed focus on sustainable farming.”

So, I have a couple of questions around that. First of all, tell us about that shift in support.

Minette:                      So, this is very, very different to what we had before. Before, under European policy, the CAP — the Common Agricultural Policy — it was so much focused on an area-based payment, on a land-based payment. And that was really to keep food affordable to make sure that, you know, there was an investment in food production that stopped this thing (of) price spikes.

                                    Now, the future view is very much to invest in the environment, and it’s called the Public Money for Public Good. So, not investing in food production, but investing in environmental delivery. And this is a global first.

You know, agriculture bills don’t come along every day of the week. This is, as you say, the second one in 70 years. And it is really important to begin it right. Now, we’ve got very little detail on the table at the moment, but also, because it’s been developing what sustainable farming can look like and making sure that the investment is actually tied to food production, as well for what the market isn’t paying for.

                                    So, this is a very unusual and a time of enormous change for farmers over here, because, you know, in living memory, they haven’t seen this approach, and it’s a global first; I don’t believe there’s any other country in the world that has done what we are embarking on. So, it will be interesting to see how it works out. But we set an ambition with that “zero (emissions)” approach, and we really do want to be world leaders in climate-friendly farming.

Tom:                          In your mind, what does sustainable farming look like?

Minette:                      Well, what we wanted to do was very much focused in the field, into the soil. So, before, it’s been very much focusing on trees and hedges around the edges of fields or just being paid to have land. And our proposal is very much actually saying, “No,” you know, “we’ve got to look at right into the business, right into the soil.” A lot of farmers here now really recognizing that soil health is so important.

                                    And there are many different things that are needed in all of these, but I’d sort of pick out, you know, one area in particular, which has been around lowering our use of antibiotics in animal medicines to deal with antimicrobial resistance. And that’s been enormously successful, and we’ve done that by driving better awareness in farmers (about) more responsible use of antibiotics but also improving genetics and improving health status. So, if you have a healthier animal, you need less antibiotics for it.

And that, of course, is all very much part of delivering on sustainable farming that decreases the food production footprint. So, for us, it’s about really getting into the business of farming and producing food and the policies that we need rather than just focusing on paying people, which — our government was very clear (that) it was not just going to pay people to produce food; they wanted to know exactly what that return on the investment looks like.

And we’ve got a massive driver here of environmentalists who believe money should be spent on the environment. So, we really wanted to create this shared synergy (of) producing food, caring for the environment and doing more for biodiversity at the same time.

Tom:                          Well, Minette Batters, I’m very curious about you and your work and your excitement around it. What gets you up and ready for another day?

Minette:                      Well, representing 47,000 businesses means that you’re always on your toes. And it’s such a time of change over here now. It’s really hard to put it into words just how different this road that we’re on is.

                                    So, I feel enormous responsibility, I guess, for what I would call setting the foundation for the future and getting them right, so that my sectors, the farming (sector), can really have a thriving profitable future.

                                    So that, I guess, gets me up every morning. I also have two teenage children who like I have to say I can spend forever trying to get them up. So, that keeps me on my toes as well. And, of course, my farming business. So, I make sure that — we have, obviously, the beef herd here, and I do all the feeding and all the stock work at the weekend so that I get my hands dirty and I keep my feet well on the ground.

So, it’s a whole mix of things at the moment. And I enjoy traveling a lot all around the U.K., and of course, not — many people, you know, are being at home (right now), which is sad. You know, (there’s) a lot of process to it, but you’re not in front of the farmers that you represent. So, I’m looking forward — hopefully, this spring, this summer — to getting back out on the road again, too.

Tom:                          Minette Batters, president of the National Farmers Union of England and Wales, with us from her farm in Wiltshire.

                                    Thanks so much, Minette.

Minette:                      Thank you so much

Marianne Smith Edge is a food, agriculture and consumer insight strategist and founder of Agri NutritionEdge where she serves as a translator between the consumer and the ag space to bring more food transparency to the food chain and improve food perception with consumers. She shares her insights on building trust with consumers by providing the security of safe and healthy food. 

The following is an edited transcript of the Ag Future podcast episode with Marianne Smith Edge hosted by Tom Martin. Click below to hear the full audio or listen to the episode on Apple Podcasts or Spotify.

Tom:                          Welcome to Ag Future, presented by Alltech. Join us as we explore the challenges and opportunities facing the global food supply chain and speak with experts working to support a planet of plenty.

                                    I’m Tom Martin with the latest in our agri-food outlook series: a visit with food agriculture and consumer insight strategist Marianne Smith Edge.

                                    Marianne is a sixth-generation farm owner in Owensboro, Kentucky. She also is a registered dietician and founder of The AgriNutrition Edge, a food and agriculture communications consulting firm. Marianne advances science and nutrition thought leadership on her firm’s website, AgriNutritionEdge.com. And she joins us from Owensboro.

                                    Greetings, Marianne.

Marianne:                  Well, greetings and good morning to you.

Tom:                          Marianne, first, if you would, just tell us about your work as both a farmer and one who advises the ag community on matters of communication.

Marianne:                  Well, I grew up on a dairy farm in Northern Kentucky, so I definitely have strong roots in the dairy industry. And at this point, I don’t do day-to-day work in farming, but in the Owensboro area, my husband and I do own farmland, where soybean and corn are grown. So, I have definitely a vested interest and (am) very involved in the agricultural area.

I think, with that background, along with my (being) professionally trained as a registered dietician and having worked in consumer insights over the years, it really does allow me to interact across the food value chain on communications. And especially in the ag community, it’s so important to really remind and work with the ag community on understanding the need to communicate what is being done and has been done over the years on moving forward and preserving land and sustainability.

You know, to too many non-farm individuals, the perception of sustainability is almost viewed as a new concept, and even though we look at it in different lenses today, we know that, ultimately, we are where we are today because farming has always looked at the preservation of farmland for future generations.

Tom:                          Well, Marianne, this pandemic — it seems like we can’t talk about anything without talking about the pandemic. And, of course, it’s been with us long enough now for us as consumers to settle into some health and food consumption trends and habits. And I wonder: What’s your perspective on trends that have emerged from the conditions of the pandemic in 2020?

Marianne:                  Well, definitely, the emergence of returning to one’s own kitchen as a necessity, of course, has emerged. We saw, by the end of the last year, that over 80% of individuals said that they were cooking at home.

                                    But the good news is that we see that individuals say that, even though there is some cooking fatigue, is that they are continuing. And even though we were hearing about the “COVID 15” — somewhat like the college “freshman 15” game — is that over a third of consumers basically said that they were cooking more healthfully.

                                    From that, we saw that online shopping, of course, (which many people decided) to do through necessity, jumped at an all-time rate, at a much higher rate than any retail had ever anticipated. And as well as — when you’re looking at trends from food, we see that individuals definitely want to connect to more local sources — and many times, especially in produce, we saw a considerable jump in looking at organics.

Tom:                          Has this opened up opportunities or expanded the market for small farms, and particularly those that are involved in CSAs, in community-supported agriculture and, you know, the weekly order of greens and so forth that we’re able to get? Have you seen any increase in that area?

Marianne:                  Yes. We definitely have seen an increase in this particular area. And I can use a friend and a farm-to-consumer meat processing business in this area as an F1 example, and have written about it in some of my blogs, is that even though he had gained a good audience through farmer’s markets over the last few years, suddenly, that increase for wanting a locally produced and processed meat grew rapidly — especially in that April and May (period), when meat, all our meat consumption seemed to increase and availability wasn’t as prevalent. And the good news is that trend has continued.

So, again, folks really want to be able to connect to food and know where food comes from. And I think there’s also that sense of security and overall safety appeal — that if they know where their food comes from, there is an assurance that, one, it will always be there, and that it’s safe and I, you know, trust the person who is producing it.

Tom:                          Any other particular current active trends that are influencing food production?

Marianne:                  Well, the trend of sustainability will continue to increase — and sustainability, of course, can mean so many different things to individuals, but connecting the planet and personal health has continued to evolve, and it should. So, I think, many times, individuals are also seeing that, “If I eat locally, if I support my local producers, then I’m eating more sustainably.”

So, in that case, looking (at), as we move forward, on a global standpoint, sustainability and looking at food systems — even though it was an active trend, this whole global pandemic has really promoted more conversation. In fact, in September, there will be a UN Food Systems Summit in New York where, really, we’re looking at the whole concept of trends and regionalization, as well as global food systems. So, that will definitely continue the conversation.

Tom:                          Have transparency and the trust that it can engender, have those things taken on more importance among consumers these days?

Marianne:                  They have. And I think we have to recognize — and especially the agriculture community — is the importance of trust and transparency. The good news is that consumers do trust farmers, but sometimes, at the same time, there is a disconnect of communication and in transparency.

                                    We always have to realize that less than 2% of the population really has a direct connection to agriculture in these days. And so, therefore, it becomes imperative that the agriculture community really communicates what’s being done — you know, why are we doing what we are doing? Whether it’s using or not using antibiotics or how plants and animals are grown or whether or not we’re using gene editing or are genetically modifying individuals, explaining what it means to the farmer but also to the consumer is really important.

                                    And so, and we know the fact that if we’re not transparent (on our own), ultimately, we will be transparent, because of the amount of information that’s available on all levels. And so, it’s really important that you, (that) those who know, actually provide the information and open the area for those who don’t know to talk about it.

Tom:                          Well, perception can be everything in a lot of situations. And I noticed on your blog that you write about trust — and specifically, you cite a national poll conducted by the Johns Hopkins Center for a Livable Future that finds that most people just don’t like industrial agriculture, but as you just mentioned, if just farmers are listed, the trust goes up. What are the dynamics behind these distinctions?

Marianne:                  Well, I do think, in many cases — and some of it is perceptions and what you hear, as well as in surveys — is that in some individuals’ minds, people imagine that farmers should be small, always small. And (they) give that illusion of kind of the “mom-and-pop” type of farmer.

                                    And so, unfortunately, sometimes, the label of industrial farm or factory farms are given to really large agriculture production (that) is still family-owned. And so, it is a misconception and (is) easily used by individuals who want to kind of frame that conversation, that big is not always good. And it seems like big food, big ag, gets a negative connotation, but at the same time, as consumers, we readily accept big technology and big food distribution systems.

                                    So, it is, it is a challenge. I think we constantly have to be able to distill the distinction and really talk about the percentage of (large) farms that are (family) owned and that farms, regardless of their size, you know, they have to be profitable if they’re going to be sustainable. And you know, larger — the larger the farm, sometimes, can actually be much more innovative in technology as well as sustainable practices. So, this is an area that we all need to continue to work on to break down some of those perceptions.

Tom:                          Well, continuing that perception thought, I wonder if it’s generally understood that to be a successful farmer, you have to be, in essence, a scientist. I mean, it can amaze the non-farmer to hear and read about what actually goes into the work of producing our sources of food. Do you think this “brain power” aspect could use a boost in the public dialogue?

Marianne:                  I do. I think, for some, the mental picture of farming is, many times — and, I, like anybody, love farmer’s markets, but you know, (with) the farmer’s markets, you get that close connection of food and individuals, and you — sometimes, you don’t always understand what goes into it, how much prep time and science has gone into it.

                                    I would say today, you know — and I can’t quote the exact numbers — but most in farming today definitely have a college education or (have) been involved in constant training.

                                    You know, my father was a dairy farmer over 51 years. And even though he was a World War II vet who did not go to college, you know, farming still — it was about his understanding the science. And so, I do think we forget that it’s very scientific, and if we really realize the technology and the science that has gone into farming over the last 50, 60 years, where we are able to only use the amount of, if needed, pesticides or chemicals or etc., based on a particular small area of the land, that we can really have an integrated pest management — we’re so much better at being able to control these inputs than, you know, than when I was growing up. And the amount of technology (and) computerization that goes into farming — to the average individual, I don’t think they do understand that, how much science goes into it. And especially as we continue to look at sustainability practices of reducing animal production or reducing greenhouse gas inputs, you know, we’re moving forward.

Looking at carbon farming, all the different technologies, it really does — it is about science and in knowing technology.         It’s a highly sophisticated profession that some, sometimes, individuals don’t regard it as such.

Tom:                          You’ve mentioned sustainability a couple of times. We hear so much about it now — even more so as the new Biden administration in Washington is rolling out its agenda. Where do you think agriculture will fit into that picture?

Marianne:                  I think agriculture is really the foundation of this picture. But the important thing — it’s going to be so important for agriculture to be at the table. I have been involved in some webinars, listening (as a) participant or discussing over the last couple of months, and globally as well as in the U.S.  And sometimes, during that conversation, people will say, “Well, yes, we need to have farmers involved.” And I am thinking, “Well, why aren’t they at the table?”

                                    So, I think it’s going to be really important that, you know, the basis of the whole concept of climate change and sustainability is that agriculture needs to make sure that we are inserted into the conversation early on. But it’s also important that we don’t keep just talking to ourselves. You know, we need to make sure that there’s an integration of conversations across the board, so those who might be making policy truly understand the unintended consequences, or also understand the positive solutions; either way.

                                    And so, agriculture, to me, is at the core of where we’re going — it’s just that we really need to be in the middle of the conversation now, not (only) when decisions are made.

Tom:                          I know that you’re involved in another conversation. You were named to the board of directors of the Foundation for a Healthy Kentucky a couple of years ago. And I know that your background includes owning a strategic nutrition consulting firm for the food and healthcare industries. Why is it important that that insight and perspective about farming and food production have a seat at that particular table?

Marianne:                  Well, it’s — earlier this week, we actually had a discussion of really bringing a group of partners across healthcare and the workforce to really look at how we can start drilling in on particular focus areas within Kentucky, to really start turning around (and) making Kentucky a healthier population.

                                    The reality (is that) we are at the bottom — not at the total bottom, but definitely at the, at the lower percentage of being healthful. During COVID, it really, it has exposed an issue we already knew: that the issues of health equity and inequity and how COVID has affected those with the higher percentage of culpability, such as diabetes, heart disease, etc.

                                    So, with my background, I do lead the strategic planning evaluation committee, and so, you know, we have to think broad-base. What are the factors that are, really, have created this, you know? At the core, it really is food, as well as access to healthcare.

                                    So, I feel like my very background, as well as my work in strategic planning over the years, can really work side by side with all the other colleagues in the health and (food) workforce to be very focused on the fact that there’s never been a better time, and it’s really important that we move forward and really identify what’s at the core and how we can reverse our health status in Kentucky.

Tom:                          Marianne, an article on your blog is titled, “Antibiotics: Cure or Curse?” And you cite concerns about antibiotic overuse, resistance, and how the two may be intertwined and how, for some, the blame is on animal agriculture, while for others, it’s on human medicine.

                                    Do you anticipate movement toward more antibiotic-free and organic production in 2021?

Marianne:                  Yes, even though I do think we will see more of it. What’s interesting — in a recent survey that was just recently released by the International Food Information Council Foundation in Washington, D.C., which I have previously worked (for) — what was interesting is they were really looking at influences on animal protein and plant protein decision-making. And about 25% of the individuals said that if a product was labeled “no antibiotic,” that really influences their decision, more so than “organic.”

                                    And so, we see that that’s typically with those that might be under the age of 45 and (with a) higher income. But, again, individuals are connecting that as a safety issue, and with COVID, there’s also been concern that, “Okay, what’s in my food or what’s being given to animal protein that, you know, is there any” — even though we know it’s not really been, that’s not necessarily true — but there is some thought within the public of, “Is there connection of how my food is raised, especially animal protein, as related to disease states or future disease states?”

                                    So, I do think we will continue to see consumer influence on looking for products that have no antibiotics. I think there’s a lot of discussion out there (about) whether, does that — is it as good for human health as (it) is for animal welfare? But antibiotics — third shift is so important across the human and animal continuum.

                                    I served on one health board a few years ago when I worked with the International Food Information, and so this is one area that really, as a human and animal health connection, that needs to continue to be looked at over the way. And with organic, even though it’s still a small piece of the total purchases, what was interesting is, last year, to your point, with COVID, we saw a much more significant increase of individuals who (are) buying especially organic produce.

Tom:                          Hmm. Well, what is on your shortlist of things you hope to see happen in agriculture and food production this year, in 2021?

Marianne:                  Oh, my shortlist. So, world peace. [Laughs] I think, in the shortlist, I keep bringing back to it, but (on my) shortlist is really bringing this whole discussion around sustainable food systems, what does that look like? And that’s a really large topic, but I think, in 2021, is that my shortlist is: what have we learned about the food value chain, the whole distribution system, during 2020? How can we use these learnings to really start looking at what needs to change? You know, what have we learned, and how can we use those learnings to really improve not only the safety (of) the distribution system but also improve trust and transparency and take that and learn what we can do better?

                                    So, really, even though it’s a very large shortlist, I think taking those where — this should give us an opportunity to really put the consumer and the farmer, along the whole other food value chain, (to put these) individuals together to really realize that, if we are going to be able to continue with having the availability of food that we have been so fortunate (to have), that we all need to come together to create transparency and trust among each of us.

Tom:                          That’s food, agriculture and consumer insight strategist Marianne Smith Edge, talking with us from Owensboro, Kentucky. Thanks, Marianne.

Marianne:                  Thank you.

Tom:                          Coming up next in our agri-food outlook series: Minette Batters, president of the National Farmers Union of England and Wales. We’ll get her views on building a more sustainable agri-food industry, working with governments on ag and trade policies and what she expects from the industry after a tumultuous year.

                                    I’m Tom Martin. Thanks for listening.

                                    Join us for the rest of the series as we reflect on how the agriculture industry adapted in 2020 and speak with experts on what’s in store for agri-food in 2021.

                                    Thank you for joining us. Be sure to subscribe to Ag Future wherever you listen to podcasts.

The European Union Green Deal is an ambitious plan to help Europe become the first carbon-neutral continent by the year 2050. Ciaran Black, an independent strategy and innovation consultant, discusses how farmers are adapting to eliminate greenhouse gas emissions, what new business opportunities are arising as a result of the consumer demand for product sustainability and what the implications are globally for more sustainable food production.

The following is an edited transcript of the Ag Future podcast episode with Ciaran Black hosted by Tom Martin. Click below to hear the full audio or listen to the episode on Apple Podcasts or Spotify.

Tom:                          Welcome to Ag Future, presented by Alltech. Join us as we explore the challenges and opportunities facing the global food supply chain and speak with experts working to support a planet of plenty.

                                    I’m Tom Martin, and I’m joined from Dublin, Ireland, by Ciaran Black, an independent strategy and business innovation consultant.

                                    Ciaran’s expertise is in leading new growth programs, creating new value propositions and challenging existing business models in large corporations as well as startups. And we want to get his take on the European Union Green Deal and what it means for food production and farming in the EU, as well as the implications for the global food chain in 2021 and beyond.

                                    Welcome to Ag Future, Ciaran.

Ciaran:                       Thanks, Tom. It’s great to be here.

Tom:                          And if you would, first, refresh us on the goals of the EU Green Deal.

Ciaran:                       Yes. The EU Green Deal is a very ambitious plan to become the first continent in the world to become carbon neutral by 2050. And, really, what it tries to do is decouple economic growth with a move toward greater sustainability and, really, the target of change recently to a much higher level — this 2050 target of carbon neutrality.

                                    And what we’re seeing is that, in the last 20 years or 25 years or so, we’ve seen a 25% reduction in emissions in Europe. But along that period of time was also about 60% growth in the economy, so the view is that economic prosperity and sustainability can go hand in hand. But the change here, really, is that the ambition of the target is much higher. So, in the next ten years to 2030, we’re looking to move from the position of around of a 25% reduction up to 55% reduction and then on toward full neutrality by 2050.

So, we’re really seeing a radical transformation of the economy and society in Europe.

Tom:                          What would be the consequences of inaction? Is there a sense of urgency?

Ciaran:                       Yes, there certainly is. I mean, I think, you know, most people and most countries recognize that climate change, you know, is a huge challenge for the planet, and it must be addressed. So, it’s not only Europe that’s pushing toward this level of ambition. We’ve seen China recently commit to climate neutrality by 2060, and I think, you know, President Biden already has signed back up to the Paris Agreement. So, I think we’ll see new targets on the way from the U.S. as well.

                                    And also, you know, in the private sector, companies like Microsoft and Amazon and Unilever are all setting themselves big targets in this regard. So, I think that the consequences of inaction are, on the one hand, trying to address really important questions for the planet, but also, there’s a competitive situation, whereby, if it’s inevitable that countries are going to be going in this direction, then delaying is not a good strategy. And also, that there are huge opportunities — if you take the first move and then start to develop new technologies and new approaches that will help meet those targets, then you’re in a much stronger position.

Tom:                          So, a goal of no net emissions of greenhouse gases by 2050. Is this viewed as a realistic goal by the European agricultural and food production sectors?

Ciaran:                       Well, I think there’s a little doubt about the direction of travel. You know, agriculture and food production, we want to become more sustainable and more innovative and produce more with less resources. You know, that’s good business, after all, so there is real interest in moving that direction.

                                    I think there is some skepticism around how fast the sector can move, and can it do these, kind of, levels of changes within a short timeframe. But I don’t see anyone that is necessarily opposing the goals; it’s more — it’s more the phase of change. And I think the real debate is around how much can be done voluntarily within the sector, and how much the legislation or regulation (will) push the phase.

Tom:                          What is happening? How is farming adapting to eliminate greenhouse gas emissions?

Ciaran:                       Well, in Europe — and the way it works is vast — the European Commission assessed these lofty ambitions for 2030 and for 2050, and then, each country, each member state, has to develop its own strategic plan in relation to agriculture. It’s called the CAP, the Common Agricultural Policy. It develops its own strategic plan about how it will transition to that objective. So, it means that each country will have its own individual and tailored plan for how the nation will meet those overall targets. So, it means that the agriculture companies within each country will have different sets of targets, but all toward this common goal.

                                    And I think there’s a growing awareness of, you know, how seriously Europe is moving toward this target and how they have to adapt their business toward that. So, I think every company in Europe that’s involved in the agriculture and food industry really understands that they need to adapt and are already progressing a long way toward being ready for that.

Tom:                          Well, a big, ambitious initiative like this, with targeted goals, can have a way of influencing the development of innovative new businesses. Are you seeing that happen at this stage?

Ciaran:                       Yeah, absolutely. I think what’s — as I mentioned with each of these strategic plans for each country, those start to have specific targets, and those specific targets drive specific innovation. So, we’re already seeing lots of activity around those, those areas.

                                    And another EU-wide basis and a huge amount of funding is going to go into incentives to increase the level of research and development and innovation across all of those sectors. So, we’re seeing a huge impact, but it’s very much driven around the specifics of what the targets are.

Tom:                          Ciaran, can you give us some examples of some of the new businesses that are emerging in response to the Green Deal?

Ciaran:                       Well, I mean, I think we’re still in the early stages, but in general, virtually all the new startups in the sector all have some kind of sustainability play. And it is right across the crops and livestock sectors, so we’re seeing that right across the board.

                                    And I think, really, what we’re seeing is that there’s a real mindset shift toward including sustainability in every decision that companies are making. So, that means that they’re really stitching sustainability into the value propositions that they’re developing. And I think we’re seeing the phase of that really gathering now, is people be can clearer and clearer about what they need to do to be able to meet these targets.

Tom:                          You mentioned earlier that a key goal of this strategy is to decouple economic growth from resource use. So, does that require a wholesale transition to renewable energy?

Ciaran:                       Well, the energy sector is a huge part of the emissions profile in Europe. So, about 75% of emissions all come from the energy sector, so it is key to the target, and this will mean much more renewable down the system, so a lot more green energy. And we’re also seeing a lot more electrification to move us away from fossil fuels as an energy source. So, things like, you know, electric vehicles moving away from fossil fuel as the source.

We’re also seeing that where electrification is not possible, a big drive for clean fuel, such as hydrogen, is every important. And overall, I think the energy sector itself has to really increase its efficiency (and strive for) a greater level of interconnection, integration and digitization of that. But it has been very clear that this sector was going to be the focal point for many years. So, I think there’s a huge amount of progress that’s already been made in relation to energy.

Tom:                          But we don’t get change of this scale and scope without debate, without controversy, without a lot of anxiety. Are you seeing those things emerge as the EU moves toward these goals?

Ciaran:                       Yes. So, certainly, yeah, you’re right, I mean, controversy is always going to be there with the level of transformation that’s there. I see the two levels. One is, you know, on the big picture, which is really to do with international trade, you know, I think (is) where the most controversial things would be — what’s called the border carbon adjustment, which is, you know, how much you can influence adding tariffs to imports that are coming into Europe that are of a lesser standard, in terms of environmental sustainability, than others. I think that would be very controversial and will have a real impact in terms of trade negotiation.

                                    Within the agriculture and food sector themselves, I think what we’re seeing is some discussion around initiatives like the increase in organic farming. There’s an objective to have 25% of farmland be organic by 2030. And (there’s) also a movement toward what’s called carbon farming, whereby the produce coming from farming is not milk and meat and crops; it’s about sequestering carbon. And, actually, how that works in practice is going to be quite controversial, and the degree to which the sector can make a transformation in that kind of fundamental sense, I think, is going to be quite difficult.

                                    And, also, I mean, I think there’s a push toward changing diets to more plant-based over meat-based diets, and I think that will be quite controversial, too.

Tom:                          Hmm. Interesting. The strategy calls for action to reduce the use and risk of chemical and more hazardous pesticides by 50%. How is this imperative, spurring innovation in pest control?

Ciaran:                       I think we’ll see a lot more innovation around integrated pest management. So, it’s not just the innovation around the pesticides themselves but, also, around the new innovative agricultural services that will, you know, monitor the growth of pathogens and, you know, help find exactly the right time when different pesticides should be used and how they’re applied.

                                    So, I think we’re going to see a much more integrated approach, which, rather than just one product, will hit a whole range of different pathogens. It will be a much more selective and intelligent use of those interventions. So, I think it’s going to be very interesting, but that obviously means that the use of data and services becomes much, much more important in the sector.

Tom:                          The plan also calls for reducing nutrient losses by at least 50% while ensuring no deterioration of soil fertility. But the plan also calls for reducing fertilizer use by at least 20%. What are the implications of this?

Ciaran:                       Yeah, those are pretty ambitious targets, but nutrient losses are bad for everyone, really — that, you know, the farmer loses, and the environments (do), too.

So, this is primarily around nitrogen efficiency, and this is quite a complex system, especially in relation to livestock farming. So, the implications are that we need to take a more holistic view; it’s not just about fertilizer itself. So, we need to have improved efficiency in areas like feed intake, make sure that that’s of high quality, and how the animal processes that feed internally is another area where we can innovate and improve efficiency. And then, also, how we manage manure and how we spread fertilizer on the land are also other areas that are important.

So, this gives, you know, a really significant scope to innovate across all the sub-systems, and the key, really, (is) to coordinate and integrate those approaches so that the sum of all those interventions delivers a really significant impact.

Tom:                          The strategy includes something called the “Just Transition Mechanism,” and between this year and 2027, this program is to pump billions in financial support and technical assistance to help those who are most affected by the move toward the green economy. Are farming and food production or elements of the sector eligible for this kind of assistance?

Ciaran:                       Yeah. I mean, the intention is that all sectors that are negatively impacted are eligible for this transition mechanism.

                                    So, in the case of agriculture, initiatives like I mentioned, around carbon farming, may help ease that transition. So, this will be a case where maybe a farmer who had traditionally been a dairy producer or a beef producer or going crops will find that situation where, because of the change toward a more sustainable future, might mean that it’s difficult for them to have an economic business in their traditional farming. So, they might migrate to things like carbon farming, which might be forestry, or different initiatives that will increase either biodiversity or the sequestration of carbon into their soils.

                                    So, mechanisms that will support that shift and that transition are certainly areas that are going to be very applicable to agriculture and food production. But there’s a lot of detail that’s still required to work out for that to work in practice. And I think this will take, you know, some quite considerable time before that becomes clear. But the intention is that the sector will be eligible for these mechanisms.

Tom:                          I saw that in detailing its Green Deal proposal on its website, the European Commission says the plan for making the EU economy sustainable involves turning climate and environmental challenges into opportunities. In what important ways can this be achieved by the food production industry?

Ciaran:                       Well, sustainability is a product attribute that customers want more and more. I mean, I think there’s a growing awareness of the importance of it, and customers are interested in that, so that’s nothing exclusive to the food and agriculture sector. So, the better companies are able to provide sustainability, the better it is for their businesses, so that’s where — that’s where the opportunity arises.

                                    Now, whether this means a widespread willingness to pay higher prices for food and produce remains to be seen, or whether there’ll be different mechanisms to support that. But I think the consumer preference is certainly there, and this creates an opportunity for producers to differentiate themselves in how they meet that. So, things like local sourcing of food and produce, you know, may increase opportunities for those local producers, etc.

                                    So, I think it’s not all about restricting practices; it’s also an opportunity to be able to differentiate and hold yourself up above competition, so there’s certainly lots of opportunities there.

                                    And also, on a more global basis, I think the global food industry will be demanding more and more sustainable produce, so if Europe is able to produce the products that fall into that category, well, then that’s good business for EU producers.

Tom:                          Is it relevant or important to the success of the EU Green Deal that, under President Biden, the United States has now re-entered the Paris Climate Accord?

Ciaran:                       Yes. I think it’s very important. You know, a broader coalition between major political powers and continents is going to be a very important aspect of meeting the global challenge of climate change.

                                    And in fact, a key component of the Green Deal strategy is what they call Green Deal Diplomacy, which is to try and get all major powers to help and support the drive toward greater sustainability, so that we can, we can meet those targets. And, you know, a key ally — having the U.S. be part of the Paris Climate Accord is going to be essential for Europe, so that they can move forward together to meet the targets, rather than having a more risky situation of playing this alone.

Tom:                          And how is this for you, Ciaran, in your line of work, of independent strategy business innovation consulting? This must be an exciting time.

Ciaran:                       Yeah, it certainly is. I mean, I think I focus on strategy, and especially around business model — and companies really need to reevaluate, actually, how they do business today and recognize that, in the future, this is going to be a pretty big transformation.

And I often think of it as, in 10 or 15 years’ time, we’ll look back, in the same as we’re looking back now — on “How did we ever do business before, without cellular phones or the internet?” — and we’ll be thinking around, “How did we ever make decisions on the business basis without building in sustainability into our overall evaluation?”

So, it’s very exciting, from my perspective, to be able to help companies advance those new opportunities or those new business models to avail of those opportunities.

Tom:                          That’s going to be fascinating to follow. And maybe we’ll check back with you down the road a little bit to see how things have progressed.

Ciaran:                       That will be great, Tom. I really enjoyed our chat.

Tom:                          Yes. Ciaran Black, an independent strategy and business innovation consultant based in Dunboyne, Ireland. We spoke with him from Dublin, and we thank you for joining us, Ciaran.

Ciaran:                       Thanks, Tom.

Tom:                          Join us for the rest of the series as we reflect on how the agriculture industry adapted in 2020 and speak with experts on what’s in store for agri-food in 2021.

                                    Thank you for joining us. Be sure to subscribe to Ag Future wherever you listen to podcasts.

What is the future of the agriculture industry after a tumultuous year? Joe Kerns, managing director of Kerns and Associates, discusses the ways the food supply chain adapted over 2020, ways farmers must be agile to succeed today and what agri-food trends to look for moving forward into 2021.

The following is an edited transcript of the Ag Future podcast episode with Joe Kerns hosted by Tom Martin. Click below to hear the full audio or listen to the episode on Apple Podcasts or Spotify.

Tom:                          What is the future of the agriculture industry once the world has emerged from the coronavirus pandemic? What should farmers and producers be thinking about now as they plan for post-pandemic success? We're taking these questions to risk management consultant Joe Kerns, joining us from Ames, Iowa. Joe and his team at Kerns and Associates work with livestock producers and suppliers in 13 states. The clients include packers, producers, veterinarians, researchers, mill operators and feed ingredient suppliers. Joe, thanks for joining us.

Joe:                             Wonderful to be here. Thanks for having me.

Tom:                          And what a year it's been, Joe. What makes your shortlist of trends and dynamics that you've been watching as agriculture has navigated this pandemic?

Joe:                             Some of the things — and I think this is kind of important, is to segregate out what was going to be a trend versus what are the shock waves that were sent to the market. And we have a tendency to lump all those together when there's an acute issue. And so, a few of them that I think that we can start to identify that are directly impacted by the pandemic are lack of travel, for instance. Certainly, that the fuel consumption is down, which impacts agriculture. With the lack of ethanol demand, it also puts fewer DDGs on the market. And so, there's some unintended consequences that are kind of the substrate of the initial event that I think are perhaps the most interesting here, whether that, if you're working from home, that we more than likely probably would not have been, but even a “ghost kitchen” is perhaps a trend that was already going to establish itself and then hits kind of the turbocharger in a pandemic environment. It’s made for some very interesting dynamics.

Tom:                          Joe, I’d like to read something from your website and then we can talk about it. You write, “The turning of the calendar is the traditional time to take an inventory of your personal situation and commit to stirring in another direction, if you so choose. Statistics show, however, that you will probably revert back to the same old habits before February. Change can be hard.” Indeed it can, but have the economic shocks of the pandemic brought about any long-term changes that need to be recognized?

Joe:                             Absolutely. And certainly, I would call (it) a shift toward even environmental stewardship. The pandemic, in another, I think, ancillary form, has brought together some of the political unrest that we’ve seen. As folks have stayed at home more, I think we've got an acute situation that we’re dealing with in a congressional issue that’s brought through funding. It’s brought through some economic strife. And it’s turned the political thing, it's turned up the heat. And our fishers in society are more exposed. I think that once these things are exposed, the genie doesn't go back in the bottle very well. Kind of even what you (read) had kind of a qualifier in there that we can change if we choose, but it is our choice. So, some things are posed upon us and other things are (our) choosing. And I think what I was really getting at, probably, in that article was dealing with New Year's resolutions specifically, and everybody has (them) — you know, “I'm going to eat better. I'm going to lose weight.” Well, that’s fantastic. But unless we say, “I’m going to run a 10K in less than 40 minutes” — those are specific deliverables that I think are the ones that we need to choose, not the type of generalities that aren’t so inflection-performing.

Tom:                          Well, speaking of New Year's resolutions, you also wrote near the end of 2020 that there's nothing inherently wrong with New Year's resolutions if they are “bends in behavior,” not wholesale changes unlikely to stick. It sounds like — to me, anyway — that you're suggesting that it's better to make modest, moderate changes than to go off in an entirely new direction. Am I reading you right there?

Joe:                             Absolutely. Yeah. The radical seldom works. You know, whatever you see in yourself or in others as a trait that needs to be changed, making a polar opposite (change) is rarely successful; it puts too much stress on the rest of our system. We’re dynamic beings. And more than likely, the item that you identify is connected to a lot more behaviors. And so, therefore, having a complete denial of all the desserts probably is a little too radical. Having them once a week is perhaps a more realistic metaphor. And I think, even in our businesses, that we've got to recognize the same. That if we’re referencing the pandemic that has imposed onto us some very, very acute dynamics — they might be financial, they might be employment-wise — even our asset base is going to be utilized.

                                    You know, thank goodness I don't own any hotels or any commercial buildings, per se, because I do think some of the long-term changes that we're going to see in society are going to render those to be of less value than they were prior to the pandemic coming. So, kind of keeping with that theme, if we get to choose them — and certainly, the resolution component is self-imposed — bends work a lot better than 90-degree angles or about-faces.

Tom:                          Well, we're talking about change, and we each can be stuck in our ways, but I wonder if it's really important to think about that and to try to be more agile in these times to come out of the pandemic successfully. And what does that agility look like?

Joe:                             Well, certainly, I think the first rules of business are: don't run out of cash. If we say that three times, it’s kind of neat to write a book about that. And I do think that having liquidity and solvency is the first key component. The second would be the frank assessment of any fixed assets that you have and what their shelf life is in the current industry, whether it's within agriculture — that if I've got a pig barn, can it be converted and utilized (as) something else? And if so, what is the net present value of that asset? And so, I am personally a fan of not owning a whole lot of fixed assets, (and) I do think our society is also moving that direction.

                                    I am not a millennial generation, but the millennials, I think, have taught us something: that they would rather rent than own in many different cases. And that does add a level of agility — that until we get things kind of sorted out and our oscillation decreases a little bit so we’ve got more confidence in our decision making, it is important just to be a little lighter on our feet and less encumbered, perhaps, with physical assets than at other times, (when) it might warrant those, in an inflationary environment — which I also think is coming, by the way.

Tom:                          Let’s kind of riff on that rental idea, because I agree with you that it seems to be really catching on, and I wonder if it could be seen as kind of a win-win situation, since you're not saddled with maintaining all that gear, all that equipment, but at the same time, somebody else is given the business.

Joe:                             Yeah. The win-win has got to be a fair return towards the equity holder. And when we were in a zero-interest-rate environment, that's probably very difficult. And again, getting back to the political scenario that we’re coming on with a little bit more debt, the changes in the Georgia (senate) race that, more than likely, are going to allow a few more progressive programs to roll through, that will inevitably increase our tax base, perhaps lead into some inflation, is that there's a secondary alternative for money. Look at the stock market. We're what, 31,000? I don't know what it did today; I think it was up a little bit also. But the Dow Jones is also giving a very clear indication that there's more to an alternative than money sitting on the sidelines. And the type of scenario that I think we're going to be in for at least for the (next) two and, more than likely, the next four years is going to be one of alternative value, bringing money off of the sidelines and making it work. We're going to punish the savers as a society. And so, from an agricultural standpoint, I believe what that means is that rates are going to have to move higher in order to compensate the next best alternative for the allocation of funds. And so, what was an easy scenario in a zero-inflation-rate environment — to say, “Why would I want to own it? I can just rent it” — I do believe that those dynamics are going to change, but we also have generational changes that are overlaying. So, it’s almost like waves that are coming together, and you’re trying to decide which one's going to be the dominant force, or are they going to conjoin to really bring some kinetic energy into a program?

Tom:                          What are some key markers in the market that you're watching for as risk-management decisions are being considered and made?

Joe:                             Well, certainly, profit margins. I think that's what — we've got to start from a sound economic base. If I'm making decisions that are leading to profits to my operation — and again, this comes back to the “What is the return on my asset base?” and “Am I better off selling it and doing something else with my money?”

                                    We, in agriculture, tend to look at these things with our hearts a little bit more than our heads at times. And I think that's one of the beauties of agriculture, is we're not just complacent and cold, steely players on a Monopoly board where we don't care what we get. We care. You know, it's the model of the entire pork industry. And so, I think that, certainly, the profit margins and then, kind of reverting back to stuff we talked about earlier, was segregating out what are the short-term changes versus the long-term changes, and how do I position my operation, and am I willing to ride out a storm? If that's what I'm looking at — and are there alternatives, and I’ll give you just a brief example. The financing alternative is we, in the United States, have a very robust farm credit system and, also, a private lending system to access funds. Not everybody has that. If you spend any time in China, it's either going to be private equity or you're going to become a state-owned enterprise. Those are really your two choices. There is no farm credit system inside of China. And so, in addition to what we already have as financing arms, we're also starting to get a little bit more creative. The over-the-counter market — some nontraditional sources of capital are coming to agriculture. And I think as long as we are open to the consideration and not say, “I'm going to do business with this bank because my grandpa did business with the bank,” we're going to be better off. There are going to be wonderful financial opportunities that come at us that, more than likely, have a few pitfalls, but I'm very optimistic of our ability and, something else we talked about, our agility and our ability to adjust.

Tom:                          Joe, there were errors in the June hogs and pig report back when COVID was forcing plant closures, and then again, in September, mistakes were made. Is the industry now stabilizing, and was that indicated in the December report?

Joe:                             I still think we’re on a little bit of a wobble. I think it's easy to look at the USDA in the September and June report and go, “Oh, my goodness, they were wrong.” And they were, but they had an impossible task at their avail. The COVID, with the backup of the animals and the suppression of plant lines, meant that we had to make some very difficult decisions on the farm, and decisions that nobody wanted to talk about nor publicize, for obvious reasons. Because of that, there was no way that we were going to quote “find” where are the missing animals on the farm. Where did they go? And so, to place any reliance on those reports was probably a little bit of a misgiving to begin with, but we were looking for anything to glob onto. And USDA comes out every quarter with the hogs and pigs report. And traditionally, we've been able to kind of hang our hat on those, to some degree of confidence, and we were looking for that. In our floundering, we're saying, “Finally, I get something to hold onto,” without the recognition, perhaps, fully, that it was not moored to anything either. It was floating along with us.

                                    The September report completely overstated the heavyweight category. That's a good thing. That's a good thing. We would have been in a world of hurt otherwise. The current report also indicates that we've got some heavyweight animals that might be a little suppressive to the market. And I believe that by the time we're set and done, we’re going to find out that that wasn't quite accurate either. Now, our oscillations are lessening. And so, whatever deviation that we might have isn’t as bad as the previous report. So, I do think that we're starting to get back onto some solid footing. I would take a look at the March hogs and pigs report as being kind of the finding where we can put a stake in the ground and say, “Okay, I can lean against this one.”

Tom:                          Okay. Let's turn to grains. You've expressed concern that pork producers may have a difficult time sourcing soybean meal in the summer unless something changes radically in the South American weather forecast. First, tell us about that forecast.

Joe:                             Well, the forecast has been one of a La Niña scenario that has traditionally hampered the production inside of South America.  We've got two different pieces here moving at the same time. So, one is: what is our South America forecast, and what do world supplies look at? The second one is: has the United States been leaned on just a little too long in order to supply products in the world, and now, we are going to short ourselves? That's, I think, a very real scenario. So, it's not only quantity; it's also timing.

So, the Brazilian crop did not get in early. We need the Brazilians to perform, as far as supplying crop to the world, and it starts in earnest in the next 30 days or so, traditionally. I have no reason to think it's going to be much different. But the United States has been the supplier of choice to the world. China's appetite has been voracious.

I think we've got a very real risk of a repeat of the scenario that we saw in 2013, where the only way that a producer was to receive soybean meal was to deliver a load of soybeans to the plant. I think we are, perhaps, (experiencing) as acute of a scenario as we were back in 2013, and that will tease itself out. We've got a report coming out on Jan. 12 that would give us final production for 2020, as well as the stocks report. And of the two of them, strangely enough, if you can only give me one, I’d take the stocks report. Let's figure out where the supplies are, and let's figure out if we've got enough time in order to parse those out until we can get to our next harvest.

Tom:                          Well, what would be the consequences if the U.S. is pressed to supply a larger-than-expected portion of the world's soybeans?

Joe:                             Well, the consequence is that we physically run ourselves out. That if I gave you half a tank of fuel and said, “Now, if you drive it at 50 miles an hour, you could make it,” and you go, “50? I'm just going to put my foot to the floor,” and you'll make it three-quarters of the way there and the tank runs dry. And that's kind of the analogy that we're on right now, is we’ve had our foot to the floor not only supplying to crush industry for domestic use, but also, we've been exporting the living daylights out of beans, figuring that we’ll worry about tomorrow tomorrow. And I think that we are on a collision course with reality, especially if we see more world demand, margins are offered.

                                    We live in a free-market economy. We could do whatever we want. We don't have to play in. That's the job of the market, is to move prices to a level that ration the disappearance. That’s what we call demand. So, that’s the job of the market, not of any one central government agency. And I think that's the beauty of what we have in agriculture.

Tom:                          Joe, you've also raised the concern that an acreage battle is brewing as we come into spring. Tell us about that.

Joe:                             Sure. More than likely, we're going to be adding someplace in the neighborhood of 8 million acres to our primary crops, corn and soybeans. If the pricing relationship remains where it is right now, our internal models would say that of those, of 7 or 8 million acres, the lion’s share are going to go beans and corn, (which) is going to have a difficult time just holding service. And that's because the soy market has been the leader so far in, and new-crop soybean is just the relationship that, if it was a traditional 2.3-to-1 relationship and taken at $11.50 November beans and say, “Well, what does corn to trade at?” You're going to find out it's $5 to make all those ratios start to come together. And when corn is trading at $4.35 or so in December, we've got some ground to make up. We've got some ground to make up between now and our planting decisions in order to encourage those acres so we don't find ourselves in a stress situation in 2021 with corn. We’re already there with soybeans.

                                    We’re going to be in a strain in 2021 throughout the use year. The job of the market is going to be to encourage enough acres to make sure that 2022 doesn't look the same for corn — the exports, the feeding demand, but more importantly, it’s the acres that we put into the ground and, then, the subsequent yield.

Tom:                          You have described an ominous situation in hog futures, the case of the shrinking open interest. Can you elaborate on that and why (it is so) ominous?

Joe:                             Oh. Well, the ominous part of it is, as pork producers, if we wish to hedge — and that is, to sell the market — you've got to have a party willing to offset that hedge — i.e., a buyer. And when the funds are not participatory, especially getting off some hedges into 6, 8, 10, forward (movement) can be difficult. We tend to have a lot of activity in the market in the front months, but the back months —  where forward-looking risk management might be prudent — the lack of fun and participation does cause a very, very real concern.

                                    I'm happy to report (that), in the last two weeks, we have seen the funds finally starting to participate. They’ve come through in spades so far in the wheat market and, then, in the soy complex and, more recently, the corn, but the livestock side of it has been kind of almost forgotten in this “go, go buy” scenario. And so, the lack of participants in the market — not everybody thinks like us, and that's a good thing, because we have to have somebody take the other side of our traits.

Tom:                          A little bit ago, you touched on the new administration in Washington, and I'd like to kind of elaborate on one thing regarding it, and that is that the Biden administration has inherited the Trump administration's trade and foreign policies. China: what now happens between the U.S. and China?

Joe:                             I suspect that we're going to start off with, perhaps, no change whatsoever. The phase-one commitments that were negotiated more than likely had enough economic parameters — i.e., China needed our stuff, whether it's soy or hogs, given their ASF position — that the buying was going to occur with or without an agreement.

                                    I do believe a, perhaps, more tender approach and respectful approach to the Chinese situation by the next administration could certainly yield more opportunities for agriculture, more opportunities for commerce that would flow back and forth — more of a dovish approach rather than the hawkish negotiating style that we had engaged in. And I'm not saying it was all bad for the United States. It is, perhaps, for (the) telecommunication component and some of the national security pieces, were, perhaps, were of benefit. Agriculture, in my opinion, was hard. It was kind of the tale of the dog when it came to the negotiating table.

                                    We recently had an episode where we had an in-person visit with Gregg Doud, and all of us in agriculture need to thank that gentleman for his participation in bringing our interests to the negotiating table and putting the provisions in that have allowed us to kind of enjoy some of this largesse that’s been flowing through right now. But I suspect the next administration could even be more successful, now that we've laid the groundwork — and perhaps if agriculture takes a more front seat, if you will, in the negotiations, in attempting to help the Chinese people bridge some of the difficulty that they've had with ASF and other production difficulties, that we could see a win-win scenario. That's something that, for the last four years, I don't think has been the goal. “If you win, that’s okay, but I’m going to make sure that I win” seems to have been a more prevalent attitude.

Tom:                          Any other signals that you're now reading or watching for as our economy continues to weather this pandemic and undergo the changes that come with shifting political winds in Washington?

Joe:                             Certainly, inflation is probably my biggest concern, and that is a double-edged sword. We are going to encourage money out of passbook savings. Savers, I think, will be not as well-rewarded. And if you take a look at some of our folks living on a fixed income, this is kind of a dichotomy. We might be hurting the older generation that, traditionally, our policies in a democratic type of approach would say that we're going to be a bit more protective of, whether it's the geriatric community and/or the environment. And the economic policy, I don't think, is going to be supportive of those living on a fixed income.

                                    Conversely, if somebody's going to have to pay for this debt — and the “tax the rich” piece is very, very difficult — (then) the next generation is more than likely going to carry much of the burden. So, inflationary pressures, I think, our one of my main concerns that we’ve got rolling forward here — keeping the political tensions at bay.

                                    Understand that, as Americans, we all have a vested interest. And you know, if you've traveled abroad whatsoever, there's a feeling, when you come back to the United States and make it through Customs, that you’re happy to be home, because with all of our warts and our scars, there’s still no place I'd rather be. There are some beautiful areas of the world. But from an opportunity standpoint and a safety standpoint, we still aren't the greatest nation, and I still hold out hope every day that we're going to survive — not only survive, but also thrive as a nation.

Tom:                          I certainly can't disagree with that, Joe. Risk management consultant Joe Kerns joining us from Ames, Iowa. We thank you so much.

Joe:                             Thanks for having me today.

I'd like to learn more about pig nutrition.