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Value-added agriculture vital to rural economy and local co-ops

By Mark McCarthy, The Star Herald
October 9, 2001
 
Finding a way to create value-added agriculture is important to local economies, but its also important that the local community cooperates to receive benefits.

At a Tuesday session of the 22nd Biennial Four State Legislative Conference, Jon Farris, division director of agricultural development for the South Dakota Department of Agriculture, told businesspeople and legislators that one problem his state is running into in development of large feedlots that create value-added ag is resistance from the local communities.

If we continue handling of the odors generated, it will remove some of the opposition, he said, adding that he does believe all environmental regulations are being met. Farris said the second difficulty producers are facing is access to capital.

Leo Hoehn, owner of Hoehn Farms Inc. and vice-chairman of the Stateline Bean Producers Board of Directors, said the bean co-op grew out of frustration watching Colorado dry bean growers be reduced from dominant in the industry to well down on the list of producers and watching Michigans navy bean growers production drop by about half.

We feel the Stateline Co-op can not only improve the local market, but provide stability to the market, Hoehn said.

Matthew Cline, a State Rep. from North Dakota, said a value-added pasta plant has been a big success there. North Dakota producers are looking to the states research stations for help, and the state has a plan ready to go for producing industrial hemp once its cleared for production by the federal government.

As most of these issues develop, we must stay even, lead or be left behind, Cline said.

Nebraska Gov. Mike Johanns said response in the state has been great to a value-added initiative to promote ethanol production. A grant program that was expected to create two new ethanol plants in the state now looks like five plants will be created.

Weve had good success and my hope is to continue that, Johanns said. Farris said South Dakota has also been successful with ethanol.

Im not sure how weve been able to do it, but the last ethanol project that went on a fund drive raised $16 million in 10 days from the producers, he said.

South Dakota State Rep. Frank Kloucek said producers still have work to do in utilizing all of the local value-added opportunities. As an example, he questioned why a South Dakota jerky plant has never used U.S.-produced beef for its product.

In our communities, we ned to start with our successful small businesses, ask them if they want to expand and encourage them first, he said. We need to start with our small businesses, then go for the big business.

Its better to have 10 businesses that are diversified than to have one large business doing one thing and have all of your eggs in one basket.

Once a community has a successful larger business, then it can build off of it in clusters, Kloucek said.

As more businesses are created to produce more value-added agriculture, Farris said the next great challenge is finding people.

Weve got a major problem in finding agricultural workers all across the state, he said.

Farris said too often people dont want to do the difficult work usually associated with agricultural production, instead preferring to find easier jobs to do.