An Interview with Organic Valley’s Theresa Marquez, Part 1: Our Broken Food System, Agriculture of the Middle, and the Co-op Model

I’m thinking a lot about food systems these days. Fundamentally, there seems to be collective agreement that ours is broken (unless you happen to work for Monsanto or Smithfield), so I’ve been spending a lot of time thinking about how we might fix it. (Jill Richardson’s excellent “Recipe for America” has a few ideas too - that and her La Vida Locavore blog are well worth reading.)

Specifically, I’ve been thinking about food systems that are:

  • Scalable - I don’t buy the argument that good food can’t feed the world, and such a faraway goal should not prevent us from taking steps to get there.
  • Replicable - If people are eating more local and seasonal food, then production needs to be decentralized. In this case, growing practices must be replicable (not necessarily scalable) in order to work in different locations.
  • Sustainable - Farming practices that can’t sustain consumers won’t work, nor will those that don’t sustain the land or the farms themselves.
  • Impactful - Small steps matter, but so do big ones. For example, how can we compare the impact of Featherstone Farm on local food to the impact of Stonyfield selling organic food to Wal-mart?

Lucky for me, I have access to amazing people to talk through these issues and to start figuring out the answers. One of these people is Theresa Marquez, Chief Marketing Executive for Organic Valley. Theresa and I recently had the chance to sit down at their corporate headquarters in LaFarge, Wisconsin to discuss Organic Valley in the context of food systems. Our conversation lasted several hours, and was far-reaching and fascinating.

Organic Valley, started in 1988, was a small (seven farmer), organic farming cooperative, the Coulee Region Organic Produce Pool (CROPP). Although the co-op was not originally focused on dairy, dairy is what Organic Valley has come to be best known for, winning butter awards and spreading the gospel of organic foods on their way to becoming a $500+ million organization. Organic Valley rightly takes pride in having helped grow awareness in organic food - and the organic food market - considerably. Most amazing to me is the fact that the now-large company has remained so true to its original cooperative ideals. Theresa Marquez was there since nearly the beginning.

On the day I met with Theresa, there was an uproar over raw milk - one of Organic Valley’s farmers had gotten busted for selling it and the market was demanding a company response. At most companies, the Chief Marketing Officer would be dispatched, probably looping in other top executives, and a position would be crafted. Not so at Organic Valley, where 1400+ farmer owners need to be considered. So I was pretty sure I knew the answer to the first question I asked - does being a cooperative make things different for Organic Valley? - before I asked it.

“Boy, does it ever!” Theresa says, “it’d be so easy if we weren’t a co-op. The way we’re set up, we have so many different opinions, we can’t dictate to [our farmer-owners] from the top down. We use the democratic process, as cumbersome as it might be. The democratic process asks people to resolve their differences, to vote for what they think is right. It also asks people to set aside what’s best for them alone and to consider what’s best for everyone.”

Theresa is barely getting started. “Society is greedy,” she says, “that’s the reason for the bailout - greed!” I’m not arguing. “[Organic Valley] is the antithesis of Wall Street. You have to work for a living. Shouldn’t we as a society put some thought into the real difference between how we treat a rich person and a poor person?” Theresa goes on to explain that Organic Valley is a true co-op (“none of us is wiser than all of us,” she says): the Board of Directors is elected by the farmers, the CEO (founding member George Siemon) is hired by the Board, and everyone is accountable to the farmers.

The sheer size of Organic Valley makes it one of the leaders in a space known as “Agriculture of the Middle.” Agriculture of the Middle, started in 2003, is the brainchild of Fred Kirschenmann from Iowa State University. Philosophically, the non-profit organization believes that medium sized companies are our best way out of the food mess we’re in. Here’s what it says on their website:

This national initiative seeks to renew what is being called the “agriculture-of-the-middle.” This term refers to a disappearing sector of mid-scale farms/ranches and related agrifood enterprises that are unable to successfully market bulk commodities or sell food directly to consumers.

In vastly oversimplified terms, here’s what’s happening. Small, successful farms are one day presented with two viable business options: continue working like crazy producing enough food to make ends meet, or; sell the farm to a gigantic company that promises to keep things just as they are - and also to provide financial stability to the farmer's family for generations to come. On one end of the spectrum, we have farmers who stay true to their ideals at the expense of their livelihood. On the other end of the spectrum, we have farmers who take the big payday, committing to keeping the business “pure” while also choosing financial stability. Very few businesses in this situation remain pure.

Agriculture of the Middle aims to provide another reasonable alternative for these farmers, and Organic Valley - and its 1400+ farmers - are our country’s best example of how to grow reasonably big without selling out. (The second biggest example company, Country Natural Beef, is a 100-member rancher cooperative in the northwestern U.S.)

Although I support my small, local farms when I can, I find the Agriculture of the Middle argument compelling in the same way that I support Stonyfield Farms quest to bring good food to Wal-mart. For most people in this country, knowing their farmer is simply not a viable option. Getting better food into large grocery stores may well be.

Theresa Marquez is, unsurprisingly, a believer in Agriculture of the Middle. When I ask how companies in the middle - like Organic Valley - will survive and thrive, Theresa takes a deep breath. “We need competitive pricing,” she starts. “We need to pool the little guys and create a very high quality product. Dean Foods [owners of the Horizon organic milk brand] is a 14 billion dollar company [so it's hard to compete]. We need to provide excellent customer service, and continue to solve problems as a team. Retailers hate to have only one choice, and we’ve got to be a viable option for them. We also need to tell our story - it’s a great story and people need to connect with people and their stories.”

Even as Theresa describes the advantages of a regional co-op model (reduced expenses, efficient systems, less duplicated effort, economies of scale, etc.), she makes it clear that she supports the little guy. She’s excited to see Cedar Summit Farm milk in more stores, and she hopes terrific farms and companies like that continue to grow. True to her philosophy, Theresa sees room for everyone in the market, and she wants to be sure that everyone gets a fair chance to be successful.

Part 2: Theresa Marquez takes on corporate greed and big agriculture.