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Covering Today’s Farms and Farm News

Longtime food and agribusiness writer Lee Egerstrom says the path of value-added ag ventures since he wrote his book on new generation co-ops has been similar to other American business startups, and believes opportunities remain very much alive for value-added agriculture.

By Tracy Sayler

At 35 years and counting, few daily newspaper reporters in the U.S. have been on the ag beat as long as Lee Egerstrom.

It’s been eight years since Lee Egerstrom wrote about new-generation cooperatives in his book, “Make No Small Plans.” While the movement has met varied success, the longtime food and agribusiness writer (pictured here in the St. Paul Pioneer Press newsroom) believes that the value-added ag trend will continue. “I would argue that the trend has to continue. While there have been bumps in the road for value-added agriculture, the problems have dealt mostly with business conditions that they’re in, whether it was over-capacity in the market or poor management.”

Egerstrom grew up on a farm near Kerkhoven, about 10 miles west of Willmar. He got into the newspaper business early, working at his hometown weekly while in high school, and at St. Cloud State University, where he got hands-on printing experience. After serving in the Armed Services, he joined the news staff of the St. Cloud Daily Times as a writer in 1967.  Then in 1970, he moved to the St. Paul Pioneer Press, which bills itself as Minnesota’s oldest newspaper, beginning as the Minnesota Pioneer in 1849.

He transferred to Knight Ridder’s Washington, D.C., news bureau in 1972, to cover food and agriculture news for affiliated newspapers, primarily in the Midwest. In 1980, Egerstrom moved back to the St. Paul Pioneer Press, where he still covers food and agribusiness. His byline can occasionally be found in Agweek, the regional farm newspaper that is owned by Knight Ridder. 

The food and agribusiness “beats” (newspaper jargon for a topic area regularly covered by a reporter), along with international trade, are inseparable, he says.

“There is a significant number of food companies based in Minnesota, particularly in the Twin Cities. Their success, and the profitability of the most remote farm in Minnesota, is directly tied to the impact of the flow, volume, and direction of trade,” Egerstrom says. “The whole chain shares a logical connection.”

Some daily newspapers don’t have beat writers who focus solely on agriculture anymore. Across the Mississippi River in Minneapolis, at the rival Twin Cities newspaper, The Star Tribune, there no longer is an ag beat writer per se. The Star Tribune, along with other dailies, now often wrap agriculture with another beat, such as business.

That is not surprising, simply given the decline in farm numbers.  “When I returned to Minnesota from Washington in 1980, there were about 120,000 farmers in the state,” says Egerstrom. “Now, there’s about 75,000, and probably only around 30,000 are real commercial enterprises. The others are in tandem with something else, like airline pilots, lawyers, and scientists who like country living.” 

In fact, Egerstrom notes that the increase in hobby farms has changed the state’s recreational vernacular a bit. “One of the clear signs of demographic change comes from talk on the streets of the urban area. It used to be that when people would talk about their plans for the weekend, they’d say they’re ‘going to the lake,’ as if there was one mystical lake in Minnesota, or ‘up to the cabin.’ You still hear that, but now you also hear business people say they’re ‘heading to the farm.’ Now ‘the farm’ is becoming as popular a get-away retreat as ‘the lake.’”

Subsequently, there are far fewer nuts-and-bolts or “how to” articles about farming in metro daily newspapers anymore. Rather, ag stories now focus more on trends, and more often than not, will have a link to economics.  “Disruptions to trade, financial shocks, and looking at how something’s going to impact ag markets and our food companies.” 

Egerstrom points out that the change in how farm news is covered is similar to how farm groups and farmers themselves have changed over the past 20 years. There is a greater focus on trade, business, and adding value to food products.  “The growth in U.S. exports hasn’t been in bulk commodities, but in higher value products such as specialty oils, meat products, and processed goods,” he says.

Another trend today is the vast availability of information and the proliferation of the electronic news medium, including the Internet. “This is forcing change in print journalism, as daily newspapers have taken on more of an analytical role, sorting out that which is real, and what’s just noise.”

While ag news has taken more of a business tone, there are still nostalgic articles about farm life to be found.  “Some of it is awfully hoaky. I just cringe when I see someone referred to as ‘the salt of the earth,’ and it’s actually ironic, knowing how this has been used as a biological and chemical agent used in warfare,” says Egerstrom.  “But there is still a strong emotional tie to farming.  It’s the history of this country, going back to Jeffersonian democracy. The political clout that farmers still have is amazing, and part of that comes from this nostalgic link. You can walk around Minneapolis-St. Paul and I would say seven in 10 people would have some link to a farm.  Now in about two generations time, by around 2050, that might change.  A lot of this nostalgia and agrarian culture we continue to have in this country I suspect will have gone away.”

Egerstrom doesn’t remember the first ag story he wrote, but does recall an early event that helped shape his interest in agribusiness news: As a “cub reporter” in Knight-Ridder’s Washington, D.C. bureau, Egerstrom was assigned to cover a breaking news story, largely because of his farm background.  “It was early 1972, and the Russians came into our market and were buying a lot of wheat.  Suddenly, groups and governments became worried about the food supply.”

Currency fluctuations in the early 1970s began to influence trade and grain exports too. “To my amazement, I found that some of this ‘dismal economic stuff’ can be rather interesting.”

Other highlights in his journalism career include working in the Middle East in the early 1970s, with an interview of then Oil Minister and now King Fahd of Saudi Arabia.  He also was assigned to cover vice presidential nominee Bob Dole during the 1976 election between Gerald Ford and Jimmy Carter.  Those experiences helped shape his early observation on world affairs. “Politics is a reaction to external events.  It doesn’t lead, it reacts.  What does change are the dynamics of economics.”

Egerstrom says he enjoys educating readers about the local relevance to global economic events and issues. “Laying down a feature about something going on in Asia, the Middle East, or Europe, and bringing it to the plant worker in the Twin Cities or to the farms, and showing how these things connect, I don’t know if anybody else notices but it’s personal satisfaction for me.”

In 1980 as a Washington correspondent, Egerstrom recalls writing a series of articles that explored the farm lobby on Capitol Hill.  “It was the first time someone had quantified political action committees in food and agriculture, putting numbers to back up what a large lobby food and ag actually has in Washington.” Egerstrom’s reporting on the subject that year earned him an award by the National Press Foundation. 

Egerstrom says another memorable article he wrote in 2001 detailed how access to health care benefits is a key motivator to off-farm jobs. 

“Many are painfully aware that farm income from the marketplace is weak, and that it is shored up by income transfers from the government.  But that’s not the biggest reason many farm families are also pursuing jobs off the farm. More important than total cash flow of the farm is access to affordable health care benefits.  We can have prosperity return to agriculture next month, and these farm families are not going to give up their jobs in town and go back to full-time farming, because of the benefits.   I know that’s a terrifically important story that I did, and a number of researchers are now paying attention to the issue.”

“Make No Small Plans”
Over three decades of reporting on farm business has made Egerstrom a well-read study on the subject.  He takes particular interest in farmer-owned cooperatives, and wrote a book about the boom in new farmer-owned cooperatives that occurred in the 1990s. The title of the book, “Make No Small Plans,” is reference to the quote by legendary 19th Century Chicago architect Daniel Burnham, who said “Make no small plans. They have no magic to stir men’s blood.”

“I became involved with writing about co-ops and co-op business structures because over the years I lost confidence that great numbers of farmers can survive just being providers to global commodity markets,” he says.  “How many individuals can become another Ron Offutt (a farmer in the Red River Valley who diversified his operation and established a multi-million dollar company)?  Most people wouldn’t have the capitol or the time.  Cooperatives are a way for farmers to pool their resources, and that excites me.”

The movement by farmers to add more value to the ag commodities they produce has been met with varied success.  Some have failed, while others are flourishing. Egerstrom believes that overall, the value-added trend has been good for production agriculture, and that its success/failure rate is similar to that of other startup businesses in America.

“Several hundred of these ventures have started in the Plains and have had a profound impact on the communities where they are operating and functioning. Have they all been successful? No, but part of the beauty of the cooperative business form is that it becomes a risk sharing venture. You can do things collectively and take a chance that individually you could never afford to do by expanding your own farm operation.”

Egerstrom points out that generally, the survival rate for new entrepreneurial startup businesses is only around 50%. “It’s amazing we can leave our homes and find anyplace to go out and eat, because restaurants are always starting and failing.  But there’s always someone with that dream, to give it a go.  When you’re talking about building plants to process your farm commodities, you’re talking about startup costs a hell of a lot greater than taking over the main street coffee shop. Most business schools, I think, would have to be pretty darned impressed with what Minnesota and North Dakota farmers have pulled off so far.”

Some of the new value-added ag business ventures have been restructured, but Egerstrom says, “I could keep busy writing about merger and acquisition activity in the food and agriculture sector. Do I find anything particularly unusual about some of these ventures evolving into alliances, partnerships, or joint ventures?  No. If we learn anything from business, it’s that we should expect to see that.”

Looking across the spectrum of American businesses, Egerstrom says few sectors are performing better than value-added ventures are today. “Look at Silicon Valley and the dot coms, where some have succeeded, some have failed and others have consolidated. It’s business, and farming and agriculture is business. You’d have to have special policies to have it function unlike other businesses, and I don’t think other people would appreciate that.”

Egerstrom believes the value-added trend will continue.  “I would argue that the trend has to continue. While there have been bumps in the road for value-added agriculture, the problems have dealt mostly with business conditions that they’re in, whether it was over-capacity in the market or poor management.” 

He still sees opportunities for value-added ventures in the Northern Plains. “The opportunities will be very similar to the business trends we’re seeing abroad.  Some multinational companies are investing overseas, but Wall Street investors don’t like to see corporate America expanding with big expenses and physical assets.  They would rather see supplier arrangements with local cooperatives. Some of these ventures are jointly owned, or maybe owned outright by their co-op partner. Look at the enormous capitol it would take an ADM or Cargill to put up a large elevator, processing plant, or flour mill on every latitude and longitude. It makes good business sense. So there are still opportunities there for farmers to continue to move up the food chain.”

Of course, when and where those opportunities are, like other trends, is difficult to pinpoint. Egerstrom says that as an ag journalist, it is easier to write about farm trends than to pinpoint them. To elaborate, he points to an observation on change he wrote in his book: “Journalists are the paid observers who write the first line in the equation social sciences use to forecast future events or explain current happenings.  The economists, political scientists, and sociologists write a second line of comparison or contrasts, then apply mathematical logic.  What takes shape is an equation or syllogism from which a forecast or explanation evolves as a logical conclusion.  Eventually, historians grade all our papers to determine whoever is right, or whoever’s just blowing smoke.”

“We often do write that first line, but it’s never the final word,” says Egerstrom. “As a writer, it’s hard to point to a defining piece.  Clearly some of the things you’ve done have contributed to a public understanding, but again, nothing is as old as yesterday’s newspaper, so you don’t want to spend a lot of time thinking about it. You just keep going, hoping to write that next first line of a logical equation.”

From the upcoming book, “Best of Minnesota Farms,” written by Tracy Sayler and Noreen Thomas, to be published by Menasha Ridge Press and CI Publishing next fall.