Source: Gary Brock videoBluegrass Farms owner Dave Martin talks about his non-GMO soybeans and plans to expand to non-GMO corn processing.
By Gary Brock
JEFFERSONVILLE – If you want to know how valuable Ohio non-GMO soybeans are to companies in Japan that use the beans in their food, consider this:
In August 2013, two officials with Japanese food companies traveled all the way from Tokyo to Washington Court House to honor president and owner Dave Martin of Bluegrass Farms in Jeffersonville at the Fayette County Field Agronomy Day.
Their message to Ohio farmers was simple: Send us more of your non-GMO soybeans, please.
Just a year before, Bluegrass Farms had added a state-of-the-art $10 million grain distribution facility.
Now the non-GMO soybean processor is poised to expand – into the non-GMO corn market.
Martin told Rural Life Today that starting with this fall’s corn crop, Bluegrass Farms will begin processing non-GMO corn for the first time; a major decision and growth for the Jeffersonville company.
Bluegrass Farms has been a non-GMO soybean processing plant for 19 years. Why non-GMO?
“The people aware of the differences between GMO versus non-GMO prefer non-GMO when given the choice. We found that most markets, as long as the price isn’t exorbitant, most people prefer non-GMO,” Martin said.
“The safety issues for the consumer are rather grey. When things are grey it is better to be cautious when making those choices. We’ve been dealing in non-GMO soybeans since 1999, right about the time of the introduction of GMO soybeans. We had to make the choice which one to pursue. We chose non-GMO.”
How does he feel today about that choice? “I feel good about it. We are in a niche market, and we feel that there is a market there and we serve that market quite well. You can’t do both (GMO and non-GMO) processing. The requirements of segregation of the beans are too great, just two different paths,” Martin pointed out.
The Japanese market
For the Fayette County company, the non-GMO choice was a successful one. In 2014, Martin said, Bluegrass Farms of Ohio Inc. processed more than 60,000 tons of non-GMO soybeans.
More than three-fourths of these non-GMO beans head straight for Japan.
Why Japan? “It is all about supply and demand in dealing with any market. In Japan, the food safety issue is all about accountability and providing the information about what all is done during the process.
“Japan is the market, the customer, that understands and appreciates non-GMO soybeans the most. It can be a difficult market to get into. Our target is the Japanese market. The rest of the markets operate on a spot basis. In Japan, contracts are done a year ahead of time. They have the same opportunity to choose their prices. The Japanese have been a longer trading partner and have been educated on how to get that consistent supply. The other countries are just now starting to do contracts a year ahead.” In addition to Japan, Martin says about 25 percent of his beans go to South Korea.
Bluegrass Farms’s non-GMO soybeans meet private sector certification standards through certification sources such as the Non-GMO project. He said the USDA is now setting up its own certification process as well. They are certified through the Association of Official Seed Certifying Agencies.
Martin said the non-GMO beans come from growers all over the area. “Mostly southern Ohio. We have about a hundred growers within a 35 mile radius. We used to have to travel quite far, but because of the acceptance of the bean and the nice premium, it is a good reward for the growers.”
He said the GM seed companies used to target the non-GMO soybean as having less yield. “Now it has been proven to just not be the case. As a matter of fact, all GM variety starts as a non-GM variety first. Yield is comparable.”
Processing the beans
At Bluegrass Farms, the company processes the soybeans by cleaning and drying them. “We get the soybeans so they are all uniform, the same size. We clean, sort and package them for market. We use varieties for each food group, and take them to markets. Some types of soybeans are used for Miso soup, others for soy milk. We do a lot of testing to know what we have and where they go.”
Martin holds up a container of his processed soybeans, looking at the label, “This is a Pioneer variety,” he said after looking at the number on the clear plastic container. “We can clean and sort and process the soybeans, but we can’t control the volume. That’s dictated by Mother Nature. That’s the challenge. Our costumers take the same amount every year – that doesn’t change. But everything we do, does change.
At Bluegrass Farms, Martin says the growers who supply his soybeans are invaluable to the business. He said that is one of the reasons they decided to add non-GMO corn this fall. Until now, many farmers grow non-GMO soybeans for him, but grow GMO corn or sell their non-GMO corn elsewhere.
“Farmers have been asking us for years to buy their non-GMO corn and we want our growers to be successful. We want every load to pass (the non-GMO standard), and they get the maximum premium. We want the whole farm to be non-GM. We want to go to buyers and tell them that the non-GMO corn growers are committed, they do a great job and not only do they supply us with non-GMO soybeans but they also supply us with non-GMO corn,” Martin said.
“We see a great future ahead of us. One of the things we have been working on the last several years is the introduction of non-GMO corn into the area and developing a market for that,” he said.
“We have been focusing so heavily on soybeans over the last 15 years, and corn is also a product that is used in Asia and non-GM corn is appreciated there and they will pay a premium for that, as well,” according to Martin.
Promoting non-GMO corn
“We have been promoting and pushing the concept that non-GMO corn is here to stay. What we are excited about here is that we are actually loading a vessel of non-GMO corn next spring, as our introduction, our first business going to Asia and hopefully that will develop into a nice market for non-GMO corn growers in the future,” Martin said. He said this first shipment will go to about 10 different companies in Asia.
Bluegrass Farms is located on both sides of Milledgeville-Jeffersonville Road and the new corn processing operation is located on one side of the road with the non-GMO soybean operation on the other. “We will be doing about 9,000 tons. We are saying, ‘Hey, we can do this too.’ This is a completely different market,” Martin pointed out.
Will this non-GMO corn processing business ever grow as large as Bluegrass Farms’s non-GMO soybean business?
“We are going about this very cautiously. Keep in mind that when we started in the non-GMO soybean processing business, everyone else was running in one direction and we were running in the other. Right now the big companies that have been handling non-GMO corn are getting out. The market has been having difficulty establishing the right premiums and who will be the suppliers. So we are entering the market at the time when there is a lot of speculation. Five years from now the suppliers might be completely different,” he said.
Focus on success
Martin says his company is successful because of their focus. “All we do is non-GM and we don’t pay attention to anything else. Our entire focus is doing that. Most competitors, it is a sideline, or they go through brokers and they really don’t understand non-GMO. We are able to be known as a supplier that the customers can depend on. Our market and our customer base grows every year. We have learned lots of times things the hard way. The one thing you must acknowledge is that because of the nature of it, if mistakes are made they can be very costly. The American way of doing business is to sometimes maybe argue, but in Asia we don’t argue, we solve problems. If you are not a problem solver, then this market is not for you.”
Bluegrass Farms is a family-owned company. “We don’t have stockholders, a board of directors, so we can move on things pretty quick.” The family business started in the 1980s when they began growing identity-preserved soybeans.
Is he satisfied with how Bluegrass Farms is going? “I’m really happy. I have my son-in-law working for us and he is new. I’m trying to recruit additional family members,” he said laughing. He and his wife have four children, three daughters and a son. “I have a son who is studying international business and minoring in Japanese. Hopefully he will come back and join us.”
He said he’s lucky to have the support of Ohio farmers. “We have a really nice group of growers and it is a nice fit. From a retention standpoint, we keep our growers year in and year out because we do focus on their success.”
He said that “this business is not for everybody. If you can’t produce blue ribbon soybeans over there…” He nodded toward a clear large plastic jar filler with non-GMO soybeans with a Clark County Fair blue ribbon draping it. They were grown and entered into the fair by one of his growers. “That’s what we are striving for. Those are some beautiful beans,” he said with pride.
Gary Brock can be reached at 937-556-5759 or on Twitter at GBrock4.