Encouraging Achievement on the Farm with Vernon Peterson

Hi friends, this is John. I'm passionate about developing regenerative agriculture systems that improve soil health, produce crops that are completely resistant to diseases and insects, and produce food of such an exceptional quality that we can have a legitimate conversation about growing food as medicine. I've been fortunate to meet many people with incredible knowledge and information about soil and plant systems. However, much of this knowledge and information is scattered all over the place. I founded Advancing eco Agriculture in 2006 to bring this knowledge together in a more coherent fashion and incorporate it into products and growing systems that growers can easily put into practice. It's my personal mission to have these regenerative agriculture systems become the mainstream globally, the status quo against which all other growing systems are compared. To achieve this goal, I want to share the knowledge that we have learned in the last decade and make it available to everyone. If you have any questions, suggestions, comments or topics that you would like for me to discuss, please connect on social media or email me johngenerativeagriculturepodcast.com Be sure to sign up for our email list@regenerativeagriculturepodcast.com Hope you enjoy and thank you for listening.

This episode of the Regenerative Agriculture Podcast was recorded live at the Healthy Soil Summit in Davis, California in August 2019. My guest was Vernon Peterson, who I was very excited to have on. Vernon is an organic fruit grower and packer in California and has had a great deal of experience in developing a farming team that is very resilient and can execute well. This is a characteristic that is particularly important in biological agriculture which is much more management intense than if we're using a lot of pesticide applications. Our community impact spot for this episode is Green Cover Seed. Green Cover Seed is a family owned cover crop seed provider sharing the benefits of COVID crops with the farming community. They've done an excellent job of conducting and disseminating research regarding new cover crop species, new blends and the ways that they are using them.

Hi, I'm Dale Strickler, an agronomist for Green Cover Seed in Bladen, Nebraska. We live on a planet that is, by and large, highly degraded soils. Hundreds of things are wrong with our soils, but there's only one solution that fixes all soil problems and that's soil organic matter. We have 120 different species of COVID crops designed to enhance some soil function or management goal fit your needs. If you want to learn more about how to build your soils with COVID crops, please Visit our website greencoverseed.com Check out our YouTube channel. We have hundreds of videos. Or give us a call 402-469-6784.

There are many excellent cover crop providers out there, but Green Cover Seeds stands out with the information that they share and make readily available. Please check them out at. Aea the Regenerative Soil Health Package is the cornerstone of the biological system that growers use to rapidly rebuild soil health. From now through September 17th, we're providing a special offer to growers who purchase this package. For more information, you can check out the AEA website, Google Free Plant SAP analysis, or call Our team at 800-495-6603. Happy growing. Hi, friends. I am very honored to be here again today, and I am very honored to have the wonderful Vern Peterson be able to share the stage with him. I've known Vern for a few years, and I won't even attempt to describe all the accolades that he has received from his fellow human beings and also all the great work that he has done. I know that Vern doesn't like to be categorized and defined by the work that he's done. So I'll just begin by asking him the question, Vern, who are you?

I think I'm an encourager.

You definitely are.

I think I'm an encourager. I think I have the gift of encouragement. But others say it's the gift of irritation. But, you know, wherever it is, family, employees, suppliers, customers, I think that's my role.

What is the difference between encouragement and irritation?

The broad smile you have when you're putting your thumb in somebody's back? I think, no, I think what we have to do, you know, everybody has their own possibilities, right? How do we get them to be able to achieve to their full potential? Right? Whether that's our kids, whether that's our employees, whether that's our customers, how do we help them be better? I think that if you come at it, John, from the perspective of I am here to give, that's the difference. An irritator wants something. Right?

Thank you. So as we approach this conversation about soil health and farming, for a bit of context, can you tell us a little bit about your operation and your background? What has brought you here today?

So we farm about 300 acres of stone fruit. We grow peaches, plums, nectarines, apricots. We pack fruit for about 80 of our neighbors, including Beyond Stone Fruit. Also pomegranates in the fall and citrus all winter. We grow. We have 11 chicken houses. So it's kind of rare to have a livestock component, but we Grow organic chickens a couple hundred thousand at a time. So that's what we do. We employ about 150 people year round.

And what do you do on your operation that is unusual for from many of the other growers in the area?

Well, it's all organic. I think what's unique about us, John, we formed this alliance and we make a bunch of little farmers look like one larger farmer. You know, just helped a bunch of little guys be very successful. And that's tough to do, as you know, in this environment. I think that's what's different.

In your alliance together, are you working together for marketing and sales? Are you cooperating in ways more than that?

We're cooperating in so many ways. All the compliance issues, we work together so you can hire one person. You got to do food safety for the packing shed. Why not knock out worker safety while you're at it? If we're going to pay everybody to sit down and learn how to wash your hands after you go to the bathroom, why not also talk about drink plenty of water on a hot day? It takes like 1% more. And if we get everybody together, then we can deliver that at a cost that doesn't. It's delegated out. It gets done, and it's not a great burden on our farmers. I went off on three tangents there at once.

Only three. What are some of the memorable moments that have led you to where you are today?

Well, graduated from high school in 75. First crop in 76, 78. My father died 81. I got married 83 and 85. Had two kids, went broke in 85. In 90, started over, managed for a large farm for that interim. Started over in 90. 2002, we flipped to organic. You know, and when you do organic, I think most of us, when we go down that path, we're looking for, what's the organic alternative to what I was doing conventionally.

Right.

That's the way our brain flows. That's how my brain flowed. There isn't one. There isn't one. Organic is completely different. Organics about life, organics about encouraging the good guys.

It's a very different way of thinking.

It's a whole different. And it's almost like an audible click you hear in a farmer's brain when it happens. For instance, our biggest challenge in Stone Fruit is dealing with. We don't have synthetic fungicide, you know, so what do we do at bloom time? What do we do on a year like this where it rained and rained and rained and didn't stop raining? Until the end of May, you know, and we're out there. Well, the initial thing was copper and sulfur, kill it, kill the pathogen. Right. We got our butt handed to us. We literally lost two orchards, junk got in the wood, we couldn't get out and we had to doze them, you know, so the second year we flipped to life and spraying on probiotics and it worked. It's still mind boggling, but getting that, getting that cell, getting that little flower coated with good microorganisms prevents bad guys from getting established. And it does it clear on through.

I've always said that it's much more powerful to be for something than it is to be against something. And that's particularly true when we're working with living systems. So the entire framework of working with probiotics versus antibiotics is always very powerful.

Yeah, but it extends to everything. It extends down to the soil. It's a holistic, taking a holistic view of everything instead of dealing with all the little parts and learning to be proactive instead of reactive. I think that's the biggest difference. An organic farmer doesn't have plan B, you know, so you have to anticipate the challenge and be ahead of it.

It's wonderful to have this conversation about soil health and producing healthy plants, managing nutrition differently. But it's very important and necessary to learn the information and to attend events such as this. But it's not enough just to have the information. You then have to effectively execute it. You have to make it work on your operation. And I know that one of the pieces that we've observed is that there are many growers who are really, really good at executing. And I want to come back to that piece, but I wanted to use that as a frame for this conversation. I've also observed that the growers who are really good at getting things done generally tend to be the growers who think very deeply about why they're doing what they're doing. And so my general observation has been that if you ask a grower, every single grower can tell you what they do, some of them can tell you how they do it, and only a few of them can tell you why they do what you do. And I believe this is something you think very deeply about. So why do you do what you do?

People. People. Why? So family. So my number one motivation is family. Number two is my employees, suppliers, customers. We have to create a biological productive system so that all of those people can have great lives. You know, our customers need to be eating really great food and we've got to turn a profit at it. So the why is people. The why is people. And somehow if you take care of it isn't just about taking care of people, but that is the why, the how, the what, those are more specific. Efficiency, you have to be all of that. But I think the Hawaii is people, if that makes sense.

So I think that's appropriate coming from someone who self identifies as the encourager. But let's go back to the first part that I mentioned that there are consistently some farms that I've observed that are very effective at, at executing and getting things done. And I think this is really the heart of the conversation that we wanted to get to. From your perspective, what are the important elements that need to be in place in order to be able. We know that when we're managing plant nutrition and we're managing biological systems, such critical windows of time, if you miss your window of opportunity, sometimes by a day or two, you've missed it for good. Which makes management and execution of paramount important. And I think that's something that I've observed your operation doing very, very well. What needs to happen in order to have that system in place?

Well, you've got to unleash people to achieve to their full potential and you've got to give people identified responsibilities, you've got to give them the tools they need. But organic agriculture, it's not well, scalable, is it guys? It's not something you go do thousands of acres of. I think it's very intense, it's intense management. So how do you do it? In each enterprise, in each aspect of each enterprise you've got to identify two or three very important things. Then you've got to figure out how to measure the. So it isn't easy guys to figure out what's important. That's a big question. That's what we get the big bucks for. But what's in this, in this practice we're doing right now? What's two or three really important things to do? Well then how do you measure that? That isn't easy either guys. What's important how you going to measure it? And then how are you going to publish that so everybody can see the results of that excellent execution.

Why do you want to publish it?

I'm not talking about putting it in acres usa I'm talking about putting it every night. Everybody involved in today's harvest knows the quality, how many pounds, what happened? Everybody needs to know that today, not tomorrow. We are already on to the next thing. If I'm thinning peaches. Very labor, very expensive thing. I've got a target. I'm supposed to be leaving 425 peaches on this tree. Am I achieving that? Where am I at? And it's not just about the boss knowing that I accomplished that. I need to know it. Everybody needs to know it. I need to know how much time it took me to do that. And when you can get that down. It's magic. When you can get those three things, guys, measure, identify, measure, and publish. Anything that's measured and published improves automatically is the quote. But when you get those things, then you can reward for the them financially. You can give incentives to the. To the executor of that. And it's just. It's beyond magic. We're in California, right? We're at 12 bucks. We're 13 bucks. In three or four months, we're headed for 15. Who knows what they'll do after that. How are you going to. 80% of my cost is labor. If I don't have the most efficient people. If I don't have the most efficient people, I'm never going to make it. You know, I think so many people focus on how cheap can I get this done. And that is totally backwards. I've got to focus. You've got to focus. And we can all do it. If everybody unleashed their labor force to produce at their full potential. It's magic. You take any. Put 100 guys out there doing something, I don't care. Pick the task and they're all getting rewarded. We're going to get paid to pick up a box of rocks. I don't know. Pick your task. The most productive employee will be performing 50% more than the average. You know that to be true. I see lots of heads and I nodding. Okay. Your least productive will be doing half of the average. Okay. That's if everybody's unleashed to pull at their full potential and they're being rewarded for it. Okay. If you pay everybody the same, nobody does more than the guy who's doing the least and he's doing 20% less. This is just basic econ 101. If you're doing any productivity study, this isn't something Vernon dreamt up, although I've observed it big time. I'll give you a very concrete example. We were harvesting. It was at nine bucks an hour is costing me eight cents a pound. We were already measuring and publishing, so I knew the quality of what was coming in. I set up a deal where I don't pay you if you pick it green I double dock you if there's mechanical damage and I don't pay you for decay. Using that formula, picking at nine bucks an hour, it cost me eight cents a pound and it went the next year to 10. So I knew, so I said, guys, I'm going to pay 8 cents a pound or 10 bucks an hour, whichever is greater. Okay? Anybody would take that deal. I can't lose. I got an up. I don't got it down. What do you think they earned at 8 cents a pound? Unleashed to do all they could, 25 bucks. 1973, the same people went from that were getting 9 bucks an hour the next year getting, earning the same as what it cost me. So I had a 10% reduction in cost. Right. And the people made 1973, everybody liked paying less. And my quality got better. My quality got better, which is the main thing if you've got retailers in the audience. If we come in with mechanical damage, I can't get it out in the shape shed. It ends up in the box. Then it decays. One of the magic about our product is everybody's working hard, but they're being real careful. And when they come up to the trailer, they don't just stack another one on top squish, because that's double dock. Right. They take the extra ones off and put them in a box and set them up. It almost makes you cry. I kid you not to see people working so hard.

Yeah. Vernon, this is a very important piece because I am very blessed and very fortunate because I get the perspective of being able to observe a lot of different farms and a lot of different growers. And consistently I've observed that those growers who are the most successful have extraordinary relationships with their employees. And you mentioned a phrase a moment ago, Vern, that some people try to get things done as cheaply as possible, but that you would prefer to, if I understood it correctly, you would prefer to pay them better.

I want to give them a chance to earn more. I want to give them the tools to earn more and I want to pay less.

You want to win? Win?

Absolutely.

Everybody? Yeah, everybody's with me. So everybody on our farm and their family guys. So those hundred and fifty employees, they've all got access to a nurse practitioner. They've all got dental, they've all got vision, they've all got 4% matching 401k on top of, you know, four years ago is 1973 an hour. So now it's 20 something. That's impressive, you know, but my cost.

Your cost has gone Down.

Guess who ain't got a labor problem.

Exactly.

You know, guess where everybody wants to work. But it's so amazing how farmers can't get that through their head. And I have. Farmers won't do it. Send me people for 12 bucks an hour. You know, I've got crews that don't want the piecework. Guess why they don't want the piecework. They don't want to work that hard. So I send that farmer the $12 crew. You know, they just can't stomach writing the check for the 20 something an hour.

So in this entire conversation about piecework and having really valuable employees that are. They're not employees, but they really are a team that wants to contribute to the entire farm. How has the. That affected your ability to execute and to implement all these various. In addition to the tree management, irrigation and cultural management, weeding the stuff that is very time sensitive, the stuff that perhaps isn't piecework.

Yeah. What I find is if five days out of this week I made really good money and one day we're going to go shovel Johnsongrass. Everybody grabs their shovel and shovels Johnson grass, you know, and we get a lot done. So it isn't like every day we're going to shovel Johnson grass, but we got to shovel Johnson grass. It isn't going away by itself. And we don't have Roundup. You know, we spend 15 grand shoveling Johnson grass. It's a new herbicide, organic herbicide called shovel.

I called it steel in the past.

There is no resistance built up yet to this herbicide.

It's a solid application of iron.

And I would. Somebody said, why not do it piece work? I would if I could figure out how to measure and publish it, you know, because if it was just, you know, how do you know this row's got a bunch, the next five don't have any. And if you don't go down three feet sometimes to get. Get that last rhizome out, you're right back where you were next month. So I haven't been able to. There you go. If you've got your. If you can figure out how to measure it and publish it, you can apply piecework to any application and not just labor. You know, you've got to be applying it to all your productivity. You need to know whether that check to AEA is getting you return. Right. So you've got to do some tests in the packing shed. You know, we pull a box from Mary, then we pull a box from Jane, we enter it in an iPad. She's getting 56 cents a box. But to find out how much she earned today, next to the time clock, cleanest packer, dirtiest packer. You go find your name and then you know how much you earned. You know, you may not give a rat's rear whether you're the cleanest packer at the Peterson family, but you don't want to be the worst. That's human nature. And so you can apply this to the farmers. You know, every 10 minutes, we pull a 25 piece sample off the cull line and we quantify and we say, farmer Bob, we measure the weight coming in, we measure the weight going out. The difference is your calls. Farmer Bob, you lost this many pounds of fruit to this defect, this many to that defect, this many to that defect. You've got to measure and publish. Otherwise, you're just saying, man, Charlie, you got a lot of worms that's eating your lunch. If he sees he lost £3,000, that's 3,000 bucks. What could he have done to fix that? But until you measure and publish, you don't. You're not getting anywhere. Tell me to shut up.

Yeah, Vern, I get excited. There's many questions I want to ask in so many directions this conversation could go, but I'd like to focus. We talked a little bit about the cost side, but how should farmers prioritize the revenue side? What is important? And I think this. I heard a comment this last week that was not new, but just the way it came across kind of hit me in the face like a two by four. It said that the definition of a commodity is where the market price equals the cost of production or less. That's. Or less. And so why would you want to grow a commodity? That's one question. But I think another more relevant question for or equally appropriate question for us to think about is, is how do we actually manage the price of the product that we are producing? So, Vern, that's a question I would have for you.

Most farmers, I believe, do it backwards. They start with production and they move to sales. Am I right? Yeah, I think that's where we're at. And it doesn't do me any good to be the cheapest raisin farmer. So we have to start with sales. You need to sell it at a profit, then go grow it. I know that sounds crazy, but that's where you have to start. And in my world, it's about balance. So my world of stone fruit production. This week I have to have a yellow peach, a white peach, a. A yellow Nectarine, a white nectarine, a red plum, a black plum, a pluot and an apricot in various volumes. And I have to have that this week. Storage can average the. We pick more today and not tomorrow, but this week. I have to have that. A field of peaches produces for a week. That means I did all of that this week and I do it again next week, and I do it again the week after that, and I do it again the week after that. May to September. That's my world. And I can't do that by myself. So we have lots of little farmers and we get together and we say, like today, I know I'm going to have hole in nectarines in about 10 days. So if somebody wants to plant something, we got to find you a good nectarine. That comes about 10 days from today. Okay, that's my world. Balance. It's all about balance. And here's why it's so profitable. If I just had peaches, very inorganic. They're not going to fill a truck with peaches. They got to fill a truck in our case with all of those stone fruit commodities. Plus I've got a partner doing blueberries and another one doing table grapes. And those all go in the same truck at the same price. That's worth three to five bucks more per box. By having all of that on the truck. Go into Earl's Organics back here. Okay, start with sales. Then. How do you differentiate yourself? The second most important thing is packaging. It isn't farming. Sell it, package it in a memorable way, in an effective way, in an efficient way, in a way that meets the need. Maybe for this customer. They need things in a grab and go package. And you can eliminate their labor and increase their ring through by doing that for them. Maybe someone else likes to build displays. You have to be able to put it up all those ways. And it's very expensive. That packaging is expensive, the sorting, at least in my world. And to have the equipment to do, you know, the stone fruit and then the pomegranates and then the citrus, it's the same people, same building, different applications. Then third is labor.

So start with sales rather than starting with production. Focus on having really good packaging. And then I think the question that many growers ask themselves for the, or they should be asking themselves for the crops they're producing is what are the characteristics that consumers care about and ultimately what are the characteristics that you need to care about as a result of that?

Yeah, there's a real challenge because what we don't Sell food to people who eat food. Doesn't that suck?

That does.

We sell food to people who sell food and don't want to discount anybody. It says in the thing here that I. That I'm running a CSA called Abundant Harvest Organics, and I did until year ago April. We had 5,500 families up and down the state, and it was a hoot. In that case, everybody knew I marketed myself as Uncle Vern. Everybody knew Uncle Vern. They could email me, you know, it was such a hoot. And we were taking produce from the farm to the people. We've lost that, you know, in modern agriculture, we're not. So what's important. What's important to me today is to score a 5 out of 10 on appearance, flavor, and durability.

Durability. That sounds like a good recipe for cardboard.

Yeah. But if it does not make it to Toronto and get over the cash register, you with the store in Toronto aren't going to buy it. So we've got to have those things then in a supply chain that's balanced. And I think, you know, a bunch of small farmers could work together to meet that. If we work together, we are accomplishing it in our little world. I think it could happen all over the country.

Yeah. I think the cooperative that you have is very powerful. Something that none of you could do on your own.

Absolutely. Ain't none of us smart as all of us.

Yeah. So, Vern, in the path that you've been on for the last 40 years and now being a very longtime organic farmer, what do you believe to be true about modern agriculture that many others might perhaps not believe to be true?

We can feed the world organically, and we can do it without an increase in cost.

Yes.

If there's. If there. If you said in five years you could not use a conventional chemical, the challenge would be finding the farmers. It wouldn't be producing the food. Because here's the secret. Conventional agriculture isn't about. Well, it's about cheaper, which is why we have this problem. But it's not about cheaper production cost. It's about easier. And we're old, aren't we? I'm 62, the average farmer. I hear 64. So I'm the kid. You know, the greatest transfer of agricultural real estate during peacetime in the history of the world is happening in the United States of America over the next six, seven years, maybe eight or nine. The old farmer doesn't have an heir. You guys are different. That's why you're here trying to make things Better, but that's the general case. So half the farmland is going to transfer. Half the farmland is going to transfer. Half the farmland is going to transfer. Certainly in the next decade. No other way around it. Half the agricultural production. That means half go away, the other half doubled in size.

That's one outcome. Yeah.

Or probably half went away and 10% of the other half can toppled in size. You know, it's a real deal. I'm on the bank board, farm credit bank board. And you know, the loans were writing aren't 3 and $500,000 loans anymore.

It's really interesting. I haven't seen the most recent or haven't analyzed the most recent USDA census, but in the 2015 census in the US fruit, nut and vegetable growers, there were 69,335 fruit, nut and vegetable growers in the country. And of those 6,923 had greater than half a million in annual revenue and produced. That group produced 90% of the total supply chain.

Yeah. Yeah.

That's less than 7,000 growers producing 90% of the total fruit, nut and vegetable supply chain in North America or in.

The US So what do I believe? I believe we can do it organically. I believe we, we can reinvigorate agriculture through organic. I believe strongly and I was going to get to this later, but if we could validate and if we can enlist you guys as a volunteer army, I believe if we could validate the superior nutrition of what this conference is about and then market that we just fix the agricultural problems. Because agriculture is. And the industrial complex is about cheap. Right. But the consumer isn't about cheap. It blew my mind the first. I paid $2.50 in the LA airport for a stinking bottle of Aquafina. You know, know the consumer isn't averse to paying. If we could document, if we could verify. If you're confident that what you're growing has superior nutrition and we could document that and verify it and then market it. I'm not sure how under some this produce has 50% greater nutrition, some sort of a label like that. I don't know. I think you're the guy that could lead that charge. And you know, we could quit making what we're doing, be about the price. You know, when it's about the price, we're done. Then it's just who's going to be the cheapest producer.

Yeah. So you preempted the question that I was going to ask, which is how do we trigger this transition when you Say that you believe we can feed the world organically. What would have to be true to get to that place? What would have to be true in order to be able to feed the world organically?

Well, you'd have to believe it. What the mind can conceive and believe it can achieve. Right. So you'd have to believe it's true. I know it's true on my own farm. Because we can match production with anybody. I can match production cost with anybody. And we've got the intense stuff, right?

Yeah. Well, you mentioned another element of this, which what I've observed is that the growers who are doing a really good job even organically, consistently, are also the low cost producers. They're the high return producers, but they're generally also the low cost producers. If you do your job well, you should be the low cost producer because you can produce more efficiently, more effectively.

In my experience, you know, we do better every year and we might get there. Right now I can say I'm even, you know, but I truly believe. Why wouldn't we? You know, we've completely eliminated mites. There's a cost. We cut one oriental fruit moth all year and we cut 300 pieces out of every lot because we shipped to Canada. So if they were there, we would know they're there. There's another cost. We've cut our cultivation in half this year, which was a big cost, burning a lot of decent.

So in this context of thinking about costs and managing costs, we keep circling around this conversation. How important is it to know and to publish your economic information to the decision makers on the team as compared to the labor force? How important is it to know that where your costs are going?

Well, you're not in business if you don't know where your costs are. And if the people making that happen don't know, then you haven't published. You know, I'm toying. There's this thing called the Great Game of Business. You might have heard of it, but you know, it's basically opening your books to your employees. Kind of a scary thought, you know, but at least your key players need to know not only cost, but income and how. A lot of people don't do that. I think everybody wants to do that. A lot of people don't do that because they don't have the software. So you've got to get software that writing a check distributes that cost. You have to have software that can distribute to a group. So that irrigator works so many hours on the Shaffer farm. So many on the coster farm, etc. And that gets spread. We need know exactly to the penny what we spent. You have to pay the irrigator anyway. Why not spread it? You have to pay the power bill. So when you enter the meter number, it spreads those dollars over these acres. So you've got to have software that does that. It needs to spread to groups and it needs in labor to be able to put in that this group is doing this activity at this price. And then if it's the whole group, you put in the total quantity and it spreads it. Or if everybody's working individually, you still fill that header and then you just put Charlie 174 units, Bill 116, you know, and you've got to have your costs.

Vern, if there was one thing that you could change about agriculture, what would it be?

It would be to reconnect us with our consumer. I think if we did that, I think if we knew that that watermelon was going to Bill and Betsy's family, it would be different than filling a bin of watermelon.

Yeah. What is something that you wish you would have known 44 years ago?

I wish I knew that the goal wasn't to be the cheapest raisin producer, you know, that would. That's a dead end. So I went broke, learned, started over, but had I known that, I wouldn't have. I would have completely started from a different base.

So I have a couple more questions for Vern, and then we're going to open it up for a Q and A for any questions that you might have for Vern or for myself. So I see a couple microphones floating around. If you have any questions for Vern, please raise your hand and we'll make sure that you get those. The one question I think is I always like asking people and listeners tell me they really like hearing the answer to is what resources would you recommend to other growers? What are resources that will really help you that you would recommend other people pay attention to?

Anybody ever read the Stockman Grass Farmer? There are a bunch of hands. Don't you love that? I don't grow cattle or sheep or anything, but I love that magazine. I love the way they think, I love the way they market. Have you read Stockman Grass?

Yeah, I get it.

I've turned a lot of people onto that and they think, why would I do that? But most everybody who subscribes thanks me. There you go.

Good.

Thanks, Vern, what's the question you wish I would have asked?

Well, how we're going to implement documenting nutrition, you know, and turning the tide of agriculture in America, you know, saving small farms. The kids aren't leaving the farm farm because they don't want to farm. They're leaving because they're not making any money at it.

Yeah.

So we've got to turn that. If we're going to turn it, we're going to turn it by providing something the consumer wants. The consumer wants organic at a fair price that has superior nutrition and they're not afraid to pay for it. So how are you going to do that, John?

The how is easy, but I want to just. I have some question marks about your approach to the why. When. When you say that growers are willing to pay for higher quality that they would be willing to pay. Sorry, yes, I misspoke. Consumers are willing to pay for quality and they're willing to pay for nutrition. If that is the case, then why do we have organics still representing such a small percentage of the total supply chain?

Well, I don't know. Have you ever read Tipping Point?

Yes.

So, you know, we're growing at this incremental level, close to 8 to 11% a year. You know, varying commodity. We're getting close to that tipping. You get up to what, 20, 25%.

And all of a sudden greater than 18 usually. But, Vern, I have a challenge with that because I'm a young guy and I'm really impatient and I want it to happen fast. So my desire would be to see this approach to agriculture of being nutrition focused become the mainstream globally in 10 years, not in 50.

I think you'll get there in 10.

Good.

You know, because I'm 62, so I don't got a lot of time, you know, success. One definition of success is where opportunity meets preparedness. So if we're not prepared to document our superiority, and maybe we're not, maybe we're not superior, maybe the organic isn't superior. Maybe every. You know, if it isn't, we need to know that, too. We're greenwashing. That would be hypocritical. But if it is true, and I don't know why it isn't, if I've got superior nutrition in my soil, but I don't know for a fact that my peach. I have anecdotal evidence. I have anecdotal evidence of how it ships. I have anecdotal evidence of flavor. But I can't give you a guaranteed analysis that says this peach is superior nutritionally to that peach. If we have that and so that's where preparedness comes in. You know, you have to be able to present a compelling story. And the consumer loves us. The consumer hate, hates agriculture, but they love farmers.

That's very true.

You know, and it's crazy. It's crazy. We score down there with used car salesmen when you talk about agriculture, and we score with the clergy when you talk about farmers. And it's the same guy. But if the consumer wants us to be successful, they don't want us to be bankrupt. They want to pay us a good price for our food. But we have, it's on us to show that we have a superior product.

How many of you here are familiar with the Bionutrient Food Association? Okay, a number of you are, but not nearly enough. So the Bionutrient Food association and the Real Food Campaign, nonprofit organization organizations out of Massachusetts. Dan Kittredge is kind of the spokesperson of these organizations. And Dan has been passionate about this conversation of documenting food quality for over a decade. He and I have known each other, we've had this conversation on a continual basis. And Dan has been passionate and has recently been successful in developing a handheld non destructive meter that can measure the nutritional profiles of virtually any crop that you expose it to.

So what does that mean, nutritional profile?

Well, first let me say that they're still in the process of developing, but the spectrophotometer can measure a signature of different wavelengths that are emitted that then correspond to different nutrients and different elements. So their intention and their goal is to be able to manage to measure the nutritional profile in terms of mineral assays, calcium, magnesium, boron, sulfur, etc. But then also all of the important and beneficial plant secondary metabolites, the phytoalaxins, the terpenoids, all these aromatic compounds that plants produce that provide flavor, flavor and aroma, and immune benefits. So the desire and the intent is to be able to measure all of this non destructively. So a consumer can measure on the grocery store shelf, a food buyer can use it to measure, a farmer can use it to measure. They released the first prototype of this device last year, and I think there's about 1,000 or so units that are being used across the country. They're in the process right now of developing a library, a database of energy signatures for these different crops that they can then correlate the signatures to specific nutritional parameters. So what is missing right now and what still needs to be developed is the database. So the Bionutrient Food association is looking for volunteers to use this device, collect data in the field and develop a database of signatures that we can then correspond to spec specific nutritional profiles. When we have that database, we will be able to do exactly what Vern is describing. And that then gives us the foundational framework to, as you described Vern, to put together a marketing campaign based on nutritional quality. Now we can differentiate based on quality. And I will also say that just based on our experience with SAP analysis, working with a lot of different growers, organic fruits and vegetables that are produced in this country, about 40% of them are the absolute best quality that you will find in the grocery store because those are the growers that really pay attention to soil health and nutrition. They try to do a really good job. And the remaining 60% are the worst quality in the grocery store because those are the growers that manage organics by input substitution, trying to use other control mechanisms to control diseases in insects.

There's also organic by default instead of design. So you just don't do anything and it's organic?

Yeah, it's called organic by neglect. Yeah, absolutely. So we have time for a few questions if there are any. Yes, actually, why don't you go ahead in the back. Have you thought about creating relationship with your customers directly, the end consumer?

Yeah, I've done that. It's really hard. We have some retail partners that are excellent at it and they want their customer to know that the Peterson family grew this peach. But that's the rare exception. We did a thing like we pack Costco, we pack Walmart, we pack it all. So Costco goes out in a five or six pound consumer pack. We put a QR code on the end of it, click the QR code with your phone and it'll take you to our farm and show you all what wonderful people we are. Right. And how to get a hold of us and how to come visit and all of that. We put out about a million five of those boxes. Guess how many people clicked it? Yeah, five. It was something you could click count on two hands. You know, it was really. So it's a challenge. It's a real challenge. So I don't know how to do it.

Yes, let's go here.

I want to circle back to what you're talking about with the software and communication. I mean first of all, congratulations for having 150 year round employees in stone fruit or and in citrus and everything else.

That's a.

For something that is so seasonal when you have a high crew demands for things thinning and high crew demands for picking. But the rest of the year it's not that 150 people. It's really amazing to have a business where you've been able to have that continuity when it comes to software. You know, it's a struggle. It's enough of a struggle to find a financial software that will even do the farm itself, much less communicate that back to the decision makers. So have you. And the cost of making your own software or paying somebody to make your own software is not insignificant. So have you come up with your own software for that? Are you using a commercial package? And how do you communicate back to those decision makers or even to the rest of the crew, what the metrics that you're using based on that check that you wrote to that employee or that cost center, Are you using amalgamation of different pieces or are you using one particular package?

Yeah, so we use for about 30 years, software called. It was Biz Books now it's called Ag Books. I commissioned. I paid a guy to go find me something better and I couldn't. So Biz Books is. Or Ag Books now. Guy's name is Bob Wiens. He's a really great guy and his stuff works. And he answers his phone. So whatever that's worth. It's got the reports you need, it's got the formulas. It does it by group, it does it by individual. You can set up a thousand cost centers or enterprises if you like. It's really challenging to be in that business because California keeps changing the rules and they change them retroactively. So it's like they're determined to kill us, but we're hard to kill. So, for instance, break times, you know, if you're piecework, you've got to be paying the piecework rate during break. And they made that retroactive. Cost me 75 grand to go back two and a half years and pay people the. I won't go there, but we've got.

Time for one more question and then I know Vern and I will both be available hereafter. So let's go into the back to the microphone. Yes. Thank you.

Yeah, thank you. You know, if we're going to go from a few percent to 50, 60, 80%, it has to be more affordable than it is today, given especially the distribution of income. You know, we. In this country, quantity is emphasized over quality, and then there's a lot of waste as well. So is there some way in which quality can be made more sexy? And in place of quantity, the heaping plate for enough if it is really good, And I wonder whether that's the formula along with less waste. So farmers can be paid more than they are today. At the same time, we eat better than we do today with less waste. Is there. I don't know whether that's a possible approach.

Vern, what are your thoughts?

We've been really successful creating number two and three box so that you can get most of the stuff sold, you know, the cosmetic defects and things. With organic, I haven't been successful successful. We. We still pack. I still have a handful of conventional growers who want me to pack their fruit, and they just can't switch to organic. So I still do some conventional. We haven't been able to accomplish that to the same level with conventional. But there's a kind of a movement right now. The ugly fruit, the. You know, the. The. There's several companies we work with that specialize in that number two stuff. I don't know if that helps you, sir, but, yeah, it's a great ideal.

I think there is one element of that ideal that it would be useful for us to understand collectively, which is that unhealthy fruit or, and I could say, low nutritional integrity fruit rots. High nutritional integrity fruit doesn't rot.

It dehydrates.

It will dehydrate, but not rot. And so there. When we. When we have this entire conversation about food waste and food loss, food waste, it's something like 40 or 45% of the entire supply chain. So that's a huge amount of. A huge proportion of the quantity. And the food that people grow, that farmers grow, never reaches people's plates. And you could actually say that that is a quality problem, that is a nutritional problem, and that if we produced higher nutrition food, a greater proportion of it would reach people's plates. Not all of it. That wouldn't account for all the loss, but I think it would account for a very significant factor, very significant amount of that loss. So, Vern, I want to thank you for joining us and for sharing your thoughts. And if you have any further questions, Vern and I will be here for a while. Thank you.

The team at AEA and I are dedicated to bringing this show to you because we believe that knowledge and information is the foundation of successful regenerative systems. At aea, we believe that growing better quality food and making more money from your crops is possible. And since 2006, we've worked with leading professional growers to help them do just that. At aea, we don't guess. We test, we analyze, and we provide recommendations based on scientific data, knowledge, and experience. We've developed products that are uniquely positioned to help growers make more money with regenerative agriculture. If you are a professional grower who believes in testing instead of guessing, someone who believes in a better, more regenerative way to grow, visit advancingecoag.com and contact us to see if AEA is right for you. Thank you for listening and we look.

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