[Music] Lakeland Currents, your public affairs program for North Central Minnesota.

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Hello again everybody.

I'm Ray Gildow and welcome to Lakeland Currents.

When I was 14, 15, 16, 17 I worked on a farm on my aunt and uncle's dairy farm in Pine River, Minnesota and I thought boy this is a life I really love although being that I'm a little older than my guests are today.

We had loose hay.

We didn't have hay bales.

We had loose hay.

We put them up in the barn with a sling and those days are gone but I still thought "oh this is a great life, I really like to do this".

So, when I got to be about 17 or 18 years old and I realized I didn't hardly have enough money to buy a used car there's probably no way in the world that I'm going to be able to buy land and get into farming.

So, I changed my direction and I didn't do that but the thing we're talking about today is family farming and family farming is changing so drastically in this country.

I'm not talking about just Minnesota but I'm talking about the agricultural business from the east coast to the west coast and the thing that we're finding is that there are very, very few young people getting into farming.

If they don't have a family connection to the land and to the property to the to the machinery, it's really tough for people to get into that business but the people I have here today have done that transition from one generation to the other and they've done it very well not saying they haven't done it without stress but they've done it very well and full disclosure these guys are both friends of mine.

We've known each other for a long time.

So, I'm introducing tonight Norm Krause who's the father.

You can tell he's got the white hair and his son John and John you said it's been 12 years now since you've taken over the farm?

Yes.

And you're not dairy farmers obviously but Norm you used to be a dairy farmer.

Why don't you share a little bit about your background before we get into what you guys do.

Okay, well thanks Ray.

I grew up on a small dairy farm by the little town of Eagle Bend and I remember my dad had like, you know, most dairy farms at the time 30, 40 cows, 50 cows and you know plus he raised all the livestock.

Well, then I went to college and had an opportunity after college to come back to the farm and I joined in a partnership with my dad and my brother for 8 years and at that time I thought maybe that was something that I wanted to do.

I found out that milking cows was not my thing even though, you know, I enjoy raising crops and all the other aspects of farming but that was not my thing.

So, then I went to work for the college for 22 years but at the same time I always had - Central Lakes College?

Central Lakes College and always had the desire to farm but just not raising livestock and so nights, weekends and holidays I maintained a small farm and we gradually grew it and we grew it to south of Staples where I worked at at the college at Staples.

And John you didn't grow up probably expecting to be in farming.

You actually took a different trail and went into lineman school at Wadena at the technical college and you did that for a while didn't you?

I did that for one summer and then I did not get hired as a lineman, as a full-time lineman so then I had the opportunity to come back to the farm and work for Norm and then Norm said that, you know, he was looking to transition out of it.

So, then we moved to move forward with that process and trying to getting everything lined up for the transition and it took 5 years.

So, Norm, we started with that and we went 20% every year and then Norm gradually just kept getting less and less and everything worked out great.

Was that a hard transition for you?

No, it wasn't as hard as what I thought.

I mean we went to - it involved a lot of people to make that transition and involved our accountant and involved our Ag lender.

It involved the insurance person and it involved a person that specializes in farm transitions.

So, it wasn't as hard.

Where did that person come from?

It came from the Ag credit system from up by Fargo.

Okay.

So and also involved, you know, a legal attorney that you have to, when you make transitions with equipment and land and that type of thing.

So, when you got into this business John were you ever thinking about livestock of any kind?

I have not thought about livestock.

We've talked about turkeys but raising turkeys, but it would not seem feasible for what we're trying to do.

Because you didn't have the buildings for it right?

We did not have the buildings.

So, then we would have to have a contract with say JenniO or any other turkey growing operation and they wanted too much of a long-term contract for what we were after.

Could you see yourself getting into what you're doing now without your dad?

No, it is impossible to get into the farming industry nowadays unless you have somebody that has a financial background to support you.

And before we get into what you guys do, I know both of you spend time with organizations.

I know Norm you've been overseas.

I think you've been to Russia looking at how different farm operations in the world operate.

I would guess they're dealing with the same kind of issues with families that we are in this country aren't they?

Almost every place we go, I mean just last summer we were in Argentina and were on a number of different farms and it's amazing, you know, the process is very similar I mean and these were large farms that we were on, sometimes some of them were over 100,000 acres.

Wow!

But they have it much more difficult than what we do because there's just not the infrastructure there like tar roads, like internet, cell phone service all that.

I mean once you get off the main road in Argentina, there's just not that infrastructure that we're used to and that we have the luxury of having here in this country.

So, how did you decide that first couple years who makes the decision, if it's going to be equipment repairs or whatever?

How did you come up with that plan?

Once John started taking over the farm I took a back seat to the decision making.

I always say if I don't sign the checks, the person that signs the checks is the one that's in control.

But that was a huge a move for you wasn't it?

I mean I'm sure it is.

It's a conscientious move and you have to be willing to let go, you know, as as the senior partner or the senior farmer, you have to be willing to let go and let the junior partner make decisions, let them make some mistakes and then from those mistakes learn a lot.

So, roughly how many acres do you farm?

It depends.

I know you rent property too but in general?

I mean, you know, 2,000 to 3,000.

Okay and that's a pretty big farm for the Staples area I would say, wouldn't you say?

For, you know, for a family farm it is.

And what crops are you specializing in?

Well, we dry beans.

We're specializing in primarily kidney beans but dry beans of all kinds.

I mean we've grown three different kinds of kidney beans - white kidneys, dark red kidneys, light red kidneys, black beans, pink beans, Navy beans, small red beans, even this year we grew some black eyed peas.

Wow!

And it was an odd year wasn't it with all the rain we had this summer?

I mean it was a very challenging I would guess.

It's kind of interesting, I know you guys don't raise sweet corn but our sweet corn crop at home was terrible and I was up at Pequot this summer talking to guys late in the fall and they said there was just widespread terrible sweet corn.

I don't know why, if it was too much rain or what.

I know we had a lot of cold nights, cool nights this year and agriculture as you guys can attest to, it's a challenging business because you have no guarantees of what you're getting for price.

No, most of the time as John says you buy at retail and sell at wholesale.

That's what farming is.

And you guys are John, I would say a cutting edge farmer because you really do believe in technology.

Yes.

Could you talk a little bit about some of the things that you've done on your farm in technology?

So, some of the things that we've done with technologies incorporated like Autosteer.

So, that way that the operators don't have to steer the machinery going up and down the field and then we've also gotten into where a lot of like technology on the irrigation.

So, we can control everything through the phone and watch things through the phone and then see if they've actually, if they're actually working or not and then we can go out there and check on things where versus back when when I first started with Norm we actually had to physically go out twice a day, check the irrigation.

I remember that.

And nowadays we can actually see when the exact time is that the pivot will break down or if it's moving or if it's not working and then we can go troubleshoot it from that point.

And you did a little work with drones this summer if I'm not mistaken.

Could you talk a little bit about that?

So, what we did is instead of using using like an airplane we've actually gone to using drones because they're much more accurate, they're closer, they're quieter and so then, you know and it's in all reality what they can do is it it's less fatigue on the operators because they don't, it's two guys but yet they can come directly out to the field.

So, two guys operate the system?

Two guys operate the system and so then they can come directly out to the field and then they can go and spray, you know, smaller fields.

So, that way they're not dealing with all like the trees and power lines and everything else.

And do they, have you gotten into the technology where you sort of spray just certain parts of a field that needs it?

We have not gotten into that technology but that technology is available.

They have what they call a see and spray and so it'll see the weed and it'll spray directly right onto that.

Wow, that's amazing!

Well, if you were starting out today, the biggest challenge would be land.

What are land values worth around our area in central Minnesota now roughly?

Well, it's changing constantly and there hasn't been that much land that is sold but it's a lot of it can be anywhere from $3,000 to $5-6,000 an acre, again depending on if it has irrigation, if it has tile ,what the, you know, what the size of the fields are.

The larger the fields the better it is especially if they're square, depending on if you have wetlands in the fields or around the edges of the fields that type of thing.

So, you know the land now is it's gone up quite a bit in the last probably four or five years and so I would say a lot of land now is in that $3,000 to $5,000 an acre.

Wow!

When you started Norm what was a good yield for corn, a bushel?

Well, I was amazed when we could get 150 bushel.

And now what is a a real good year producing?

Well, John 270 to 300 bushel.

300 bushel!

Wow!

Just in certain parts of the field.

It's not across the whole field but I mean the average is we're this last year 40 bushel above the national average.

Really, wow!

And John has been the one that has done that.

What do you attribute that to?

It attributes to variable rate technology.

So, you know we variable rate the population.

What do you mean variable rate?

So, in the field we'll go anywhere from say like 34,000 up to 36,000 depending on the soil types and how it lays out in the field.

That's the population of the corn.

What it does is it takes into account your soil test and your soil maps of that you have a beach field and then where the soil has the ability to produce more, we put more product.

You put on probably you have a a higher rate of population, you put on more fertilizer that type of thing.

One of the things we're doing as we share this tonight is we have some video of your farm and some of the storage facilities.

I remember Norm when you started I think you had maybe two bins and how many bins do you have now?

We are up to seven, plus you have some cone bottom bins for temporary storage or for seed storage.

Wow!

So you don't haul your grain into a feed store.

You haul your grain into your own property?

Yes.

And then you hold it until you think the prices are right?

Yes.

Is that right?

And then we have the ability to get our crop in in a timely manner, that's the main reason why we built all the infrastructure and then we can go from there during the winter time and deliver grain all winter long.

Wow!

So, you have semis?

Yes.

You have tractors?

What else do you have for equipment?

Irrigation equipment and then we do have some tile that's in the ground but that's not equipment but you know tile helps us out immensely and everybody thinks that tile is like a storm sewer and it is not storm drain and it is not.

What it does is it just takes the excess water.

So, what I always explain to everybody is the ground is like a sponge and so if you put a sponge in water and pull it out you see the droplets that come off the sponge, that's all that we're capturing for what when we do tile.

So, but tile is a great asset for us.

So, in order to get those kind of yields you got to have tile and because our ground does not have the ability to hold water like say in southern Minnesota or western Minnesota which is native Prairie ground, we have to supplement it with irrigation.

So, some of the ground has irrigation, some of the ground has tile, some has both in order to continuously the entire field to get good yields.

So, if and you've had young men work for you, young guys, I'm not going to name names but I know one of them is into the dairy business now and that was his dad's in dairy too but I know he spent some time in your business and it's good to see a person young, I don't know how old he is in his late 20s early 30s doing well.

If someone came to you and they're dynamic and energetic and they want to learn about farming are you open to working with like an internship?

Yes, I would be more than happy to work with somebody like that.

Are there any internships from any of the colleges that are doing anything with young people?

I think Central Lakes College is doing some internships, you know, to help out with some of that but we haven't tied into that yet.

We have not tied in that.

We haven't had the need to I suppose yet for help?

But I mean it would be nice and I think the right person to come along, I know John would be very open to help with that person and to training that person.

I mean it takes a while to learn what you're doing.

I don't think people probably understand the stress that you're under during harvest or production time.

It's a very stressful life.

You got to have good weather.

You can't have storms and you can't have big equipment breakdowns.

It's a really challenging job isn't it?

I'm not suggesting people shouldn't do it but it's not something that just anybody can do.

They have to have a set of skills to be able cope with that.

How, what's your coping background?

Do you have a strong wife that helps in the in the business?

I do have a strong wife that's very helpful in the business and she does all of the book work and she helps out with with the daily and Mom and Dad and my parents yes they help out as well so and some of the most difficult thing in agriculture nowadays is managing people.

In what way?

What do you mean?

We don't have the training to manage people and so understanding how to work with people and their attitudes.

And so you're talking about yourself as a manager?

Yes.

Of having the skills to work with challenging people?

Sometimes that is the most challenging nowadays.

The transition, there's a lot of people to help you with transitioning but as far as the management aspect everybody has trouble managing their operations.

So, it's interesting that, you know, it used to be that you could just one family was all that was employed on a farm, you know, a father, maybe a son, a couple daughters or whatever and the wife.

Now in order to have an economically viable farm you have to have enough acres which then requires people and so, you know, that's what I've told some of the like CHS and some of these that invest in transition planning, I said not only do you need transition planning but you need in employment, you know, how to how to deal with employees and how to treat employees and how to get the most that you can out of them to, you know, for efficiencies and that type of thing and there is very little of that training out there and I'm hoping eventually that the colleges and you know some of the organizations that offer that type of classes or training would look at that in greater detail.

That's interesting because I'm sure a lot of the farms around central Minnesota are just little family farm operations and they don't have the demand for extra labor for example, so they just do their own business but as an organization grows they can make or break you can't they?

If you get, for instance you had what seven or eight people working at harvest because you have two-three truck drivers, you have a grain cart operator, combine operator and then you have somebody doing tillage and then somebody has to keep all of that going.

And what do you do in the off season?

Do you do a lot of equipment repairs?

We do equipment repairs.

Do you have mechanics that help or how do you do that John?

So, I have a couple employees that come and help me like for instance in the shop and then in the winter time we do a lot of paperwork because we have to work with 17 different state and federal agencies.

17?

Yes.

Wow!

And so they're all getting paid to do the paperwork and we are not.

Wow!

That's a lot.

My wife and I, we sat down and counted up the agencies that we work with, you know, for instance DNR, MPCA, EPA, all the different, you know, Soil and Water, Farm Services Agency agencies, NRCS.

Wow!

So, you know it's a lot of different state and federal agencies that you do paperwork for your business.

Wow!

So, when you look at the younger people that do come and work, I'm sure it gets discouraging for them if they want to get into farming but they don't have the money.

Correct.

What are some options?

You know any options?

I know that's not what you guys do but are there options for these younger people to try to get into something?

There is options for these younger people but they have to go find somebody that's already in the industry and then see if they can get involved with the operation.

So, becoming an employee is a good way to start with that and then going there from that point on being progressive and trying to learn the operation and how to do that so and maybe get in a partnership or just very similar from a father-son.

It would be, you know, somebody outside the organization would slowly work their way in.

If that's what they desire.

Sure.

Wow!

So, I know you've raised other crops like barley.

Do you do that anymore?

Do you raise barley?

We raised barley.

We used to raise molting barley for Anheiser Bush but we've gotten away from that and now we've raised it for more pet food.

Really?

And then how about straw?

Do you still have a a good outlet for straw?

Yes, straw is very easy to get rid of because it's it's a product that can be used for bedding, it can be used for landscaping, anything as far as that goes and there's not that many people that raise small grain in the area.

We do it for rotation.

So, you raised both the barley and I've raised some oats and then we've also raised rye as well okay and some spring wheat once or twice.

So, okay wow and then we're doing some, John is doing some small grain for seed production.

So when you're looking at some of the crops John and you're trying to get the yields up, what are the beans that you're finding that are the most profitable for you guys right now?

What kind of beans?

The kidney beans is the most profitable, you know, a lot of times what we say is it's a third of our acres and it's 2/3 of our income.

So, that's what's helped us along with all that.

And have they been pretty disease resistant for the most part?

They are not.

So, there's a lot of old technology in the seed compared to what corn and soybeans is because we're a small part of the world, you know, as far as raising a crop goes.

So, do you still go out and look for buyers for your products or are you pretty well locked into a group?

We're always continuously looking for new buyers because then it presents new opportunities.

Now you have a daughter and she's how old now?

She's 10 months old.

10 months old, so she's not ready to help out yet is she?

No, not even close.

But do you see your daughter getting involved in agriculture at some point?

I hope that she has hope that she wants to get involved.

You could have four boys who knows, you're still a young man.

And actually sometimes women are better managers than men are.

Really?

Yes, because they know how to manage people a little bit better than what say men will because we're more blunt and they're more willing to listen to some of the problems and then try to work with that.

Well and again I think in the like in the summertime during your growing period that's when you're really dealing with so much stress and it's some of those days I'm sure it feels pretty short.

In our operation we always joke, we say that we plant for 6 weeks and we harvest for 6 months because we get done planting in the first part of June and then we start with our first cutting hay right after that so then we start harvest right away.

Wow!

So, are you seeing any other new farms in the area?

Not really, it's most of it is an expansion of existing farms.

And we don't have as many beef operations in your area like Eagle Bend, Staples as there are north of here.

Right.

There's a lot of beef operations in the north and that's beef and hogs are up and down too aren't they?

I mean they are very challenging.

What's this year looking like for harvest, for production and for price?

Production is going to be down just a little bit because we've had a lot of rain but then overall production in the United States is up so then the price is going to continuously go down and then the challenge is the government with the trade and everything and they haven't got the farm bill done yet so.

I know it's been a year and it hasn't done anything.

And so I mean that becomes more important is to get that done to so the farmers have some certainty in looking forward.

I mean right now for most of the commodity crops corn, soybeans, primarily there's red ink.

It's not profitable unless it's different circumstances like exceptional yield or you're able to get inputs for less than what the average person is but both corn and soybeans are not profitable at the present day prices.

Wow!

Isn't that something and in your free time you burn wood?

Yes.

And you burn wood for your machine shop?

Yes, that is heated with wood and you heat your home with wood but it's not chunks of wood that I use.

It's a pretty good size operation isn't it?

Correct.

Yes and that a lot of work too though isn't it?

It is a lot of work.

Do you do that cutting mostly in the fall and the winter time?

We do a lot of cutting during the summertime we're always improving fields.

Okay.

And so we're always cutting up around the edges of the fields to try to help with production.

Norm and John you're a successful team and I'm very proud of you.

Congratulations.

You've been watching Lakeland Currents.

I'm Ray Gildow.

So long until next time.