Value Added: The means to a more profitable end Dusty Walter UMCA Training Specialist Agroforestry provides a way for landowners to enhance and diversify on-farm economic opportunities. If that isn’t encouragement enough to implement agroforestry, consider the fact that it is possible to do this while practicing an ethic of scientifically based environmental stewardship. To some folks, a down side to plantings that incorporate agroforestry technologies is that products which are produced typically do not fit into traditional commodity type markets (either in type or because of their comparatively small scale production). While this conundrum is faced by some of the agroforestry practices, the issues of scale and/or marketing of niche products are also affecting many family farms across the nation. Therefore, in an effort to maximize the profit from investments on their farms, more and more farmers have begun applying principles broadly categorized as value-added. The term value-added references methods of increasing the profit realized from goods produced. Often it involves the processing and/or packaging of a product in such a fashion that the producer is able to sell to a broader market. But, it may also be that the processing places the product in a better position to enter niche or specialty markets. Niche markets refer to product arenas that sell for a specific, often narrow, use or purpose to an identifiable clientele. This type of direct marketing to a consumer may be contrasted to the selling of produce in wholesale or commodity markets. These broader markets remove much of the control over pricing and investment recovery that might have existed for the producer. So then, the idea behind increased involvement in the processing of raw farm products is to increase their value and/or marketability to the public in order for the farmer/grower to retain a greater share of the profit from their sales. Recently, I had the opportunity to visit an operation involved with adding value to pecans. Located in Nevada Missouri, the Missouri Northern Pecan Growers LLC (MNPG) (Limited Liability Corporation) has been in the business of value-added pecan processing for about two years. Drew Kimmell, Max Senkevech, Joe Wilson, Wayne Harth, Kevin Hines, and Jim and Florence Wilson formed a sevenmember cooperative that emphasizes growing and producing locally grown Missouri native pecans. Native pecans growing in Missouri are at the northern limits of their natural range and because of many variables, including weather and the length of growing season, the nut produced is smaller than varieties grown in southern states. Since perception and appearance often create better market opportunities, some would see the production of a smaller nut as being at a marketing disadvantage. Yet, what Joe Wilson and other members of the MNPG have recognized and are promoting is that the native/northern pecan has a better flavor. This sweeter flavor has been linked to the nut’s higher oil content. In the 1970’s Loyle Byrd sent his Missouri pecans to be tested, and it was identified that their oil content was 73 percent. Comparatively, the larger southern grown pecans had an oil content of closer to 60 percent. Coupled with the promotional packaging as a locally (Missouri) grown pecan, the sweeter taste and higher oil content have become components of a successful marketing plan. In addition to harvesting and cleaning of cooperative members’ pecans, the MNPG also offers the services of its plant to other pecan growers. MNPG’s initial investment in plant, equipment and expertise can benefit other growers seeking to add value to the pecans they grow and wish to selfmarket. Most all of the pecans processed, an estimated 98%, are locally grown. They charge 8-10 cents per pound to clean debris from pecan loads, and an additional 25 cents per pound for cracking. This year MNPG is marketing cracked pecans for about $1.50 per pound. Further value can also be added to cracked pecans. Once cracked, the nut meats can be separated, packaged, and then as a result of the additional processing, sold for a higher price. The closer to ready-for-use a grower can make his/her product, the greater the value to the consumer. Additional methods for maximizing profit include identifying markets for products typically disposed of as waste from processing. Drew Kimmell believes in taking a product that is without a market and developing one. For instance, MNPG has begun producing a container of small chips and pieces of pecan nutmeat for shaking onto salads and ice cream. Kimmell’s philosophy goes beyond recognizing a niche opportunity; it also involves marketing activities. Efforts of MNPG ensure consumers will associate Missouri pecans with MNPG and become repeat customers. Joe Wilson and others with MNPG have placed an emphasis on promoting and selling pecan products outside the traditional wholesale markets. With Missouri producing less than 3% of the nation’s pecans, innovative packaging and marketing become important parts of building a successful business around the northern pecan. MNPG has been able to utilize a Missouri Value- Added grant designed to promote products made in Missouri and has hired a marketing consultant. As its business has grown, so has its ability and efforts to enter larger markets. You can now find the Missouri Northern Pecans’ label and product in area chain stores such as Hy-Vee and IGA. Keep in mind that growth at a smart rate (controlled expansion), as well as knowing your capacity for production (the ability to meet demand), all become essential components to becoming successful. A key to success in the business of value-added products is recognizing the traits that make a product unique. Creativity also has a role in business success. For farmers and landowners producing goods from the land, the opportunities associated with adding value to those goods should not be overlooked. In growing a product you have already done some of the hardest work: working the ground, planting, maintenance and harvesting. Value-added processing takes your work one step, and then another step further, (as many steps as you would like to take) continually working you and your product closer to the consumer. This also enables you to better tailor products to meet the wants and needs of consumers. Does that mean that the valueadded process is for everyone and every commodity? No. For instance, if you are a producer who would rather not interact with customers on a daily basis, you probably should not turn your barn into a storefront of products for sale. But, you still might consider additional processing and packaging and let someone else conduct the final marketing. By developing a Limited Liability Corporation, such as MNPG has done, several things are accomplished including having a greater supply of raw goods for entering larger markets through bringing different people together as members. Moreover, other benefits of involving many members are realized as each is encouraged to exercise his or her individualized skills towards better marketing and product sales. What ever your decision, for those who are willing to put in the time and money towards developing an enhanced product and/or its marketing, the additional income generated is often worth the investment. Forest Products Marketing Conference Benefits Landowners Julie Rhoads UMCA Training Specialist The recent Special Forest Products Marketing and Production Conference, held in Cape Girardeau, Mo. and hosted by the University of Missouri Center for Agroforesty, enlightened 100 conference participants on the numerous ways to earn income from their woodland other than just growing trees for timber production. Special forest products consist of an array of products intentionally produced within a modified forest canopy, an agroforestry practice known as "forest farming." Eighteen speakers were brought in representing the Center for Agroforestry; University Extension programs in the states of Washington, Illinois, Nebraska, and Texas; retail and wholesale operations in Missouri, Minnesota, Arkansas, and Illinois; and a Cooperative Development Service based in Wisconsin. The speakers distributed printed materials and made slide presentations demonstrating the methods of production and marketing for the commodities they represented. Speakers brought exhibits to educate participants and allow them to see the actual products being produced. Exhibitors interacted with landowners during the evening of the first day and had been encouraged in advance of the conference to bring products to sell. Many landowners won items donated as door prizes by the exhibitors and the University of Missouri College of Agriculture, Food and Natural Resources. A majority of the exhibitors were interviewed on videotape by Center for Agroforestry personnel for inclusion in a video to be produced in the future on the topic of forest farming. The various topics exhibited and discussed throughout the two day conference included forest mushrooms, tree and shrub seeds, medicinal plants and herbs, woodland wildflowers, woody florals, wild edibles, craft materials, hive products, custom sawn and specialty wood, pecans, pollen and pine straw. Ask the Expert How do I protect my newly planted trees from deer browse? First of all, sports hunting should be allowed in your area (bow hunting in more urban areas) to help in preventing population expansion of white tail deer. Once the deer population gets very high, shooting damage-causing deer is not very cost effective in that deer simply move in to replace deer that are removed. You should know what to look for to distinguish deer browse from rabbit browse. You can look for hoof prints on the ground and telltale droppings near the damage. Deer don’t have upper incisor teeth so they tend to tear off the vegetation as they browse. Rabbit damage is two feet or less from the ground and they leave smooth cuts when they browse. Remember that deer tend to browse young tender growth in it’s early stages and may not be very noticeable, yet by nipping plants "in the bud" you have lost much potential growth of a tree for the season. There are two basic ways of preventing deer damage -- repellents and barriers (fencing). Repellents in general only provide moderate protection and may be only a temporary fix as deer learn to ignore the repellents. Fencing on the other hand is permanent and can provide good to excellent protection depending on the extensiveness and how well the fencing is maintained. Area repellents are applied near plants and repel deer by smell. Examples are small bars of soap, human hair, moth balls, chicken eggs (20% eggs/ 80% water), coyote urine, and commercial products such as Hinder and Big Game Repellent (Deer-Away). Contact repellents are applied directly to trees to repel deer by taste. Examples are Hot Sauce (6% Hot Sauce/ 94% water), Habanero peppers (8% pepper/ 92% water), Thiram, and commercial products such as DeerGuard or DuraPel (both contain bitter tasting Bitrex). These repellents should be applied as needed, as new growth appears and after heavy rainfall. A deer’s learning ability tends to make repellents fail over time and truly hungry deer will ignore repellents. It’s a good idea to switch repellents periodically as a counter measure. If deer browsing is heavy or you need rather complete and permanent protection, then a physical barrier (exclusion) is necessary. Physical barriers range from woven wire fencing 8-10 feet high or electric fencing, to protecting individual trees with welded wire hoop cages or using tree shelters (tubes). Tree fencing requires the least maintenance but is costly to install. A common style electric fence used at the Horticulture and Agroforestry Center (HARC) consists of sevenfoot steel posts with six electric cord strands with a solar charger. Care must be taken to keep the fence well maintained, by keeping vegetation off the wires or deer will easily jump or crawl through the fence. Individual trees can be protected using wire hoops. Five-foot tall welded wire (2x4 inch grid) cut into five-foot sections formed into a hoop and fastened to the ground with a four-foot section of rebar is being used at HARC. The downside is that its harder to maintain the trees with the hoop in place and during windy periods the trees may rub against the top of the cage causing trunk damage. Plastic tree tubes are also used to protect individual young trees. Problems have been observed using tree tubes such as spindly stem growth and winter damage. There are now tubes that are made with coarse mesh or fine mesh (openings about 1/8th inch). These tubes require more extensive staking from top to bottom to hold them up. The coarse mesh tubes have the problem of allowing the side branches to grow out the sides of the tubes allowing browse, while the fine mesh tubes prevent this problem. The mesh tubes do not have the winter damage problem of the solid tubes and also do not harbor mice and wasps. Wire hoop cages and tree tubes have the benefit of protecting from rabbit damage that electric fences lack. Floodplains that have frequent flooding will cause debris buildup on fencing and caging. Cages and tree tubes can even be pushed over by debris and the current of the floodwater. Cages and tubes should be removed as soon as branches are above most of the browse damage. These trees are still small enough to be vulnerable to buck rub. At HARC, two steel posts are positioned alongside each tree trunk to help prevent total girdling from buck rub. This is not necessary in the electric fence exclosure areas. I suggest you research the pros and cons of the many treatments for deer damage control in regard to your particular situation and to check out the many resources on this subject on the internet. Conference Focuses on Forest Stewardship The 23rd Annual Tree Farm Conference will be held February 22 at the Country Club Hotel at Lake of the Ozarks, which will address landowner concerns and questions about private forest management. An educational field trip for people pre-registered for the conference will be held at a private property in the Lake Ozark area on the afternoon of Feb. 21. Conference workshop topics will include forest health, red oak borer, forest farming, farm bill update, cost share assistance for landowners and a timber update. The awards ceremony will include the presentation of awards for regional and state tree farmer of the year. Also at the ceremony, families that have operated tree farms for 50 and 100 years will receive silver and gold tree farm certificates. Registration will begin at 7 a.m., and the conference will adjourn at 4 p.m. Foresters and other professionals will be available at the opening continental breakfast to visit with landowners. Pre-registration is encouraged. The fee for the Saturday conference and luncheon is $45 and includes the Friday afternoon field trip. For more information, contact Julie Rhoads, University of Missouri, 203 ABNR Building, Columbia, MO 65211, 573/882-3234, email RhoadsJ@missouri.edu. Newsletter Deadlines Because your newsletter must be in the mail at least 30 days before the next organization meeting and another three weeks is needed to get it ready and through the printing process, the deadline for the next issue is: February 1, 2003 Send your newsletter material to: Hank Stelzer, 203 Anheuser- Busch Natural Resources Bldg., Forestry Center, University of Missouri, Columbia, Mo. 65211. Phone (573) 882-4444. Your management tips, ideas, questions and experiences are most welcome! Calendar of upcoming events February 21-22, 2003 The Missouri Tree Farm Conference will be held at the Country Club Hotel at the Lake of the Ozarks. The registration fee is $45. For more information, contact Julie Rhoads, 203 ABNR Bldg., University of Missouri, Columbia Mo. 65211, 573-882-3234, RhoadsJ@missouri.edu. February 8, 2003 Missouri Nut Growers Association Annual Meeting and Nut Show will be held at the Nevada Community Center in Nevada, Mo., from 9:30 a.m. to 12:30 p.m. The meeting will include featured speakers, awards and election of new officers. For more information contact Ken Hunt at KenLeeHunt@aol.com January 16, 2003 The Karkaghnae Club winter meeting will be held at Zeno's Restaurant and Motel in Rolla. Hospitality hour will begin at 5:30 PM. A cash bar will be available. Dinner will be served at 6:00 PM. The cost of the dinner will be $10 per person, including gratuity. The featured dinner speaker will be John Hoskins, Director, Missouri Department of Conservation, speaking on how he will stear the future course of the Conservation Department. Bring your questions. Contact Karl Wolf at KarlR22@aol.com, 314-962-1841. March 22, 2003 Tri-State Forest Stewardship Conference will take place in Keokuk, Ia. For more information, contact Julie Rhoads, 203 ABNR Bldg. University of Missouri, Columbia, MO 65211, 573-882-3234, emailRhoadsJ@missouri.edu Send event dates to: Christa Jennette 203 Anheuser-Busch Natural Resources Bldg. MU Center for Agroforestry Columbia, MO 65211