HOG HEAVEN
posted on
May 28, 2015
HOG HEAVEN
Eight hogs are in heaven. They have nearly doubled their weight in the past two weeks, and we are preparing to move them to pasture. They are being fed non-gmo grain and have access to outdoor living and fodder. We are looking forward to tasting their bounty this fall and sharing it with you.
We can choose the source of our foods, from commodity food grown in soil saturated with Round-Up (above right) or from grass-based systems which build organic matter and deliver the quality of nutrition our grandparents used to savor (above left). The challenge is the food on the right generates higher short-term cash flow than food from start-up, grass-based systems. This creates an obstacle for grass-farmers to purchasing land. Without a secure land-base, the supply of "green" food into cities from these farmers is at risk. How do we solve this problem?
I think it is by partnering with capitalists who:
- are interested in preserving their capital against erosion from inflation,
- have a long-term investment horizon of 25 - 50 years, and
- place value on production of green food on green land for the welfare of local society.
As mentioned, Midwestern farmland has historically generated returns in excess of inflation of around 7%, doubling money in 10 years (not 15!). So, $1 million invested in Year 1 will end up as $16 million in Year 50, if the arithmetic is correct. The grandchildren of the capitalist will be amazed and grateful, because everything else they might have inherited will have slipped away by then, having succumbed to the vicissitudes of human nature and the market place.
The proposal for securing sources of green food therefore is this:
- An investor buys 300 - 500 acres of farm-land with cash, suitable for livestock management, and holds it for a minimum of 25 years. This is his only cash outlay for the entire period of ownership. But it is a considerable one of $2 million or more.
- The land is then leased to a grass-based farmer, who pays no rent, but covers all costs of: a) developing infrastructure, according to an agreed upon plan, and b) paying operating costs, like taxes, insurance, and maintenance of property. It is expected within a certain number of years, the farmer will be producing and delivering green food to interested consumers off this land and will be maintaining the farm to a given standard of tidiness.
- At the end of the agreed-upon holding period, the investor sells the property, with the farmer having a right-of-first-refusal to purchase. The investor realizes her return on investment and grandchildren are happy. The grass farmer has had time to build his business and should be in the position to buy the land should he choose to do so, which pleases him greatly.
This is a very simple agreement, with both parties succeeding financially over time, because of collaboration, common values, and patience, while generating a highly desirable social good.
If any of you know of investors or aspiring farmers who meet the above criteria, I would be interested in connecting with you. You can contribute to the cause through your capacity to network, for the benefit of more good food coming to your neighborhood. We can't succeed without you, the customer. Thank you for caring.
Speaking of good food, this was a recent dinner enjoyed with an old friend and fellow grass-farmer. Susan sauteed lollipop lamb chops in a cast-iron skillet, baked glazed apples, mashed comforting potatoes, and steamed fresh asparagus. For dessert, we savored homemade chocolate chip cookies, strawberries, and whipped cream. Eduardo's Brie cheese delighted as well. This was all local food. We could taste the minerals and feel the strength it imparted.
This week we are thinking heaven includes happy pigs, wise capitalists, ardent grass-farmers, and green customers.