Investing in Regenerative Agriculture and Food
Investing in Regenerative Agriculture and Food podcast features the pioneers in the regenerative food and agriculture space to learn more on how to put our money to work to regenerate soil, people, local communities and ecosystems while making an appropriate and fair return. Hosted by Koen van Seijen.
Investing in Regenerative Agriculture and Food
361 Herb Young - After 36 years at Bayer, growing regen citrus with 8x the nutrients
A conversation with Herb Young, farmer who, after 36 years in the chemical industry working for Bayer, retired and bought a small farm in Georgia—where things quickly got out of hand. While researching organic premiums, Herb came across regenerative agriculture—and fell deep, very deep, down the rabbit hole. For over a year, he read everything, listened to everything, and then planted his first trees.
A few years later, Herb is now one of the leading regenerative citrus growers in the country, conducting cutting-edge research while selling his first harvest directly to consumers in over 36 states. And the most surprising part? His citrus is, on average, eight times more nutrient- dense than conventionally grown oranges. That means you’d have to eat eight regular oranges to match the nutrients of just one of his. Suddenly, the idea of food as medicine becomes very affordable. And, of course, his citrus is incredibly tasty.
We also discuss his history in the agrochemical industry, what his former colleagues think of his new "hobby" and what excites him most about the upcoming second season.
More about this episode on https://investinginregenerativeagriculture.com/herb-young.
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In Investing in Regenerative Agriculture and Food podcast show we talk to the pioneers in the regenerative food and agriculture space to learn more on how to put our money to work to regenerate soil, people, local communities and ecosystems while making an appropriate and fair return. Hosted by Koen van Seijen.
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we're definitely going. So what we'll do, first of all, welcome. Obviously could be late, could be early, wherever you are. What we'll do in this very uninformal agenda like structure. I received some questions beforehand, some people emailed some questions beforehand and I'm um, definitely gonna ask, answer them first and after that please feel free to answer or ask your questions in the chat room. And because if we all unmute at the same time it's going to be quite a bit chaos and I will get to those questions and I will ask for any clarifying parts, if you, you can obviously then unmute yourself the moment I'm getting to your question and we'll just keep everybody mute for now. Thank you, laura. In the call settings, that's a good question, but so far we have done. I think we have most people actually on the call already. So we'll get started and I will type, I will copy and paste the questions we already got and into the chat room so you can actually see it.
Speaker 1:And the first one is from trudy, which is a very deep one we can spend more than an hour on, probably, which is a greater obstacle to scaling up regenerative agriculture, financing or cultural slash, educational issues like resistance and obviously doing things differently. It might come as a surprise for somebody that's been running and investing in regenerative agriculture and food podcast, but I definitely think it's a second part Financing. It may sound not so easy to hear if you're currently raising financing, if you're running a fund, if you're running a farm and you've tried to raise finance, but it seems to be that there's a lot of willingness, at least from investors, to get active in the space. Definitely a lot of education needed on the investor side of things and let's actually get Trudy into the question or into the waiting room, because I just saw her joining. So, trudy, thanks for joining. We're actually just getting to your question. So I definitely think it's the second part and the cultural and the educational part. It's much more of a cultural shift than it is a finance shift, probably first and foremost a cultural one. Why? Because on the financing side we need to do a lot of education for a lot of investors, obviously on how soil works, how regen x works and the timing, the length, the flexibility etc. But that we need to do in general in impact investing and I'm looking to frank who has been doing that for the last 25 years.
Speaker 1:When it comes to the receiving end of the investments. There is a lot of work needed there as well. We have a structural seems to be a structural shortage of good projects to invest in. It sounds horrible Again, if you're trying to raise money and you cannot find anybody now. It doesn't mean your product isn't good, but it might be that the language you're using using it might be that the investability is not always the same as running a good project.
Speaker 1:And you should probably also really wonder if you want to raise any outside capital. There. There are a lot of strings attached that comes with with money and many people choose not to raise outside capital and choose to to run it on, to grow it on, cashflow bootstrap, et cetera, et cetera. So once you've made that decision to really do you want to raise outside capital, there are certain language things, there are certain reporting which are not always easy for farms because they're very, very flexible, and there's a great shortage of investable projects, funds, farmers, companies that are really getting regenerative agriculture to scale. So I would say, definitely the greater obstacle is currently the cultural and educational side of things. Doesn't mean that we shouldn't do a lot of education on the investor side of things, because my question usually is when is the last time you talked to a farmer or visited a farm? And that could be a while ago or never, which makes it very difficult to run either a family office or a fund or any kind of financial institution that claims to be focused on regenerative agriculture.
Speaker 1:Trudy, does that answer your question? I muted you. I muted you. I was just explaining the question, so you didn't miss any part of the answer. I think so it's.
Speaker 1:I think the bigger shift has to happen on the food company level, on the farm level, on all of us as a consumer, to really understand that what we believe to be the normal is is actually something that we can fundamentally change in a lifetime. And that's quite a big thing to ask from, uh, from all of us. And there is the interest in the podcast, interest in general in, in finance. These things is growing exponentially. We just crossed 100,000 downloads actually two days ago, and 75% of that was last year. So just to see the size of I don't trust the stats too much of SoundCloud, honestly, but it gives an idea. The interest in the space is exploding and I think it's up to us to create the structures, the infrastructure, the pipelines, if you want, of this space to put that energy. Part of that is money, part of that is time. A lot of people reach out that they want to work in a space where our job listings etc. We have to channel that energy because we need all of it. We need to transition absolutely millions and millions of farms and with that obviously we need to get farmers on that journey and that requires all. So the finance. I'm less worried about it. I'm definitely worried, but I'm less worried about that compared to our outlook towards food and ag.
Speaker 1:And then we received a second question I'm just going to mute Trudy again which is a much more practical one, and I'm of Adrian actually and so how does organic farming differ from RegenAg and would the transition from one to the other be relatively straightforward? Again, this is one we can probably spend two hours on and there are people on the call and people I've interviewed that can give a way better answer on this. The simple answer, as far as I know again, I'm not a farmer and haven't run any regenerative farms at scale ever is that the traditional or the organic systems we know now, especially the larger scale, more industrial size, are much more. They move from a conventional system and they move, transition to an organic one, basically swapping inputs and swapping do a certain type of things not and another basically changing a set of inputs for another set. So less chemical, less basically switching the input side of things or the oil that's running the machine, but they didn't really fundamentally change the way they're operating. One big example is obviously plowing, which happens a lot against weed pressure, which doesn't happen if you're running an advanced regenerative system.
Speaker 1:So the second part of the question does it make it easier if you're organic and switching from like? Could it be a stepping stone? I think in terms of mindset? Definitely yes, because you are working more with nature and less against. But I've seen many organic systems that are absolutely not regenerative and in some cases actually more destructive than conventional systems. So it's not either or it's definitely. We need to go way beyond of actually at least the industrial size organic we've lately seen and maybe go back to at least the principles of the original organic. But obviously take into account that we have made. We've seen huge changes in terms of technology, in terms of understanding of soil, in terms of research. We're not at the same place where we were 60 or 70, 80 years ago. We're in a very different place, so it's both a step forward and backwards.
Speaker 1:Adrian does it. I don't see you on the screen but that's because we have a few. Does it answer your question? You should be able to unmute yourself. Where is Adrian? Maybe he fell off the call. Anyway, we're recording it. I will let him know. I see Martijn asked a question in the chat.
Speaker 1:The claims of many advocates of RegenEgg seems to be too good to be true Higher yield, higher nutrition value and better for the climate and environment. What's the caveat? Higher costs, agree, I think many, especially lately we've seen many, many articles written, many people basically claiming that region egg is the tool that will change everything overnight and and obviously, soil will solve all the world problems we can possibly imagine. I think the caveat is is that that's simply not true, and everything that sounds too good to be true usually is too good to be true. It's not easy. It requires a fundamental shift of how we've been doing agriculture in many cases for a very long time, not just the last 40 years. It's definitely possible to do at least equal. We've seen examples now of equal yields and if you compare it on a crop by crop basis, the complex thing obviously is that many of the region egg and, let's say, advanced farmers are multi cropping and it's very difficult to compare, to have an honest corn to corn and let's say corn to corn research if you're also doing two or three other crops in the same rotation. So the yield part, we see that the most advanced ones definitely get to the same, let's say, calories per acre or per hectare as the conventional ones, obviously with a lot less input. So profitability is a huge driver for many farms to make the shift. Because many are shifting you see that very often in Australia and the US because they simply they hit a wall and they cannot pay for inputs anymore. So they go and look for other ways of running their farms.
Speaker 1:It's not easy and fast. I think. The huge changes happen over time and they're very, very place dependent. So almost every region has to figure out what's the most effective design here to store the most carbon, restore the most water or whatever you want that system to do. And it's not easy to incorporate trees into a big arable farm. It's not easy to sell your crops partly directly, as many will discover now in our discovering in COVID. It's not easy to um figure out things that actually nobody has ever figured out at that scale. It's not easy to find machinery to harvest certain things.
Speaker 1:It's very great to do it on a hectare where many things you can do by hand, but what happens if you have 2 000 hectares? What happens if you have 20 000? What happens if you're super remote and you cannot sell directly? So the easiness, I think, is the big caveat. I would say most of the potential benefits. We still haven't really understood what happens if you do this at scale, let's say a full region, a full island I've heard stories about Mallorca and other places like what happens? What actually happens to the climate? But basically the local climate, does it stabilize if you change your monocrop corn field for a multi-crop? Does it, and we see some early results in that. But we have only literally scratched the surface. So I think the caveat and martijn is really it's.
Speaker 1:It's a fundamental shift and we should not kid ourselves that this is something that all farmers and all consumers will tomorrow knock on our doors and say oh, oh, of course. Why didn't I think about this before? It's a very fundamental shift which requires a holistic approach from financing, from funding, from grant, from tools, from machinery, from seeds, input markets, consumers, the whole spectrum, unfortunately, or maybe fortunately. Actually Does that answer your question? I see a nodding on the screen. We can honestly also spend an hour on just this. Obviously, sorry, go ahead.
Speaker 1:I would argue not. If you look at the farmers that have been wiped out by, honestly, this year, the huge rains in the US where a lot of farmers in the Midwest couldn't plant, simply they couldn't get on the land because it was too wet. So I think we underestimate the risk of the current farming system and it's being either covered by subsidies, covered by crop insurance, that is, a subsidy covered by other things. So I think we overestimate the returns and underestimate the risk of the current system. And if you look at the very advanced region farmers, they weather usually a lot better when their neighbors are really suffering. So the risk part, I think, is actually very favorable because you're much more resilient and in some cases even you could argue anti-fragile, but that's for another call. So I think the risk part is actually much more interesting if you're building your biggest asset, which is, at the end, soil.
Speaker 1:But there's a price. There's a price which is time. There's a price to figure out. There's a price of becoming much more entrepreneurial as a farmer and going where probably none of your neighbors and none of the people. I've heard stories of people that started to switch and started in the transition and their children were no longer invited in the soccer team and things like that. So don't underestimate what it means to go through this, and I think we all we are writing these amazing articles, we're recording podcasts, in my case, and we make it sound like it's a walk in the park, but it's definitely not. So it's very easy from the city to argue and my answer is always go talk to farmers, listen, and probably we all learn a lot.
Speaker 1:Okay, I want to. I saw Galaxy Note. I don't see your name, but you unmuted yourself, which probably means you wanna add something or ask something, or maybe not. I will mute you. Veerle, I saw you had a question If you're a beginning investor in region ag, are there already European funds out there to invest in?
Speaker 1:Can you describe the landscape of various funds? So my answer is usually it depends, which is not a very satisfying answer. There are not so many. There are not so many easy places where you, as a either high net worth individual or retail investor or somewhere in the middle can invest. Today there are a lot of people working on things, but a lot of people have been frozen, obviously in the crazy time we're in um. So the answer is no, um I. And the second part of that answer is it really depends what you would like to do. There are a number of funds that the strongest funds are.
Speaker 1:The funds that have been in the space for the longest time, usually in the US and Australia have been funds that have been buying land and regenerating it, and that is a more of an infrastructure play, very similar to renewable energy, and those have had a track record and many are raising the third fund or fourth fund etc. And actually raising quite large amounts. We can have a long argument about land ownership and should it be concentrated or not, and I think that's an argument we need to have, but those have been the most advanced in the space so far In terms of funds that help current farmers to transition. I've seen three experiments maybe so far, or three experiments are in process, some are still under the radar and I think we're going to see an explosion and that would be very interesting for people to invest in, because then you can invest alongside farmers and as they're going through the transition, without the land having to change ownership and obviously without a lot of money being tied into the land. But there the answer is in Europe. I haven't seen anything. I've seen one crowd answer is in Europe. I haven't seen anything. I've seen one crowdfunding platform in France, which so far has only been open to French speaking, called Mimosa. So M-I-I-I sorry M-O-S-A and they have done small projects. They're partnered with Danone and Carrefour to help some of their farmers transition. So I'm guessing more of that will happen there, but so far, in Europe at least, not an easy place to go. Please send me stuff if you've seen things, but I have not found too much. I'm trying to obviously keep an eye on the sector, also here as much as possible From Priska.
Speaker 1:Does regenerative just refer to the environmental aspect of agriculture or can it also imply regenerative processes on social, cultural and economic dimensions, like fostering community building? I think the clear answer. I think it's a personal answer. My answer is definitely yes. I see it's very difficult to do regenerative agriculture and not do and not hit a lot of the social aspects that we would like to see in this world as well, I have to get to see an example where that, for instance, happened. It really depends on the focus of the farmer, the focus of the fund, the focus of the group that's running it, the trust, et cetera. But almost always I've seen a very close connection between the environmental and the social and I would strongly argue that we should keep it that way because otherwise, why are we doing it? I think there's a very interesting angle if you look at, obviously, the farmworker side of things, which in some countries is a much bigger issue, in some other countries a much smaller issue, and which in most regenerative farms are much better treated. Farmworkers are much better treated than not, but it's definitely something that also the crazy blog post that it's going to save the world often focus on the carbon, the water and the climate and not so much on the social side of things.
Speaker 1:I think a big potential impact we'll see on the healthcare side, which obviously is a social part as well, when we truly dive deep into the nutrient density of things and start to discover which some early research now is showing that this tomato being grown organically you find in the supermarket, or this tomato grown regeneratively relatively nearby, are fundamentally different products and they have very different nutrient contents and there you get a bit more tying into the too-good-to-be-true area. But we're going to see a lot of research coming out that a lot of the food we thought was full of nutrients is actually quite empty and a lot of the food that is grown very differently is actually almost medicine. So we're going to have that discussion of food as medicine, which is going to sound very weird but it's going to be very interesting and I think there the social aspect is very strong in terms of learning abilities, in terms of we are literally what we eat, and a lot of. There's research on prisons that when they started to actually feed the prisoners, cook the prisoners good food, a lot of the violence went down and things like that. So I think we're going to see an explosion on food as medicine measurement and really see that connection.
Speaker 1:Healthy soil, healthy produce, healthy gut systems and healthy people I mean think with your gut probably comes obviously from there. Does it answer your question, priska? I take that as a yes, gadi. How do Regenec people and yourself see the concept of hydroponic growth technology, which are, at least to some degree, a closed circle of water and materials, more efficient, controlled, very suitable for cities, obviously closer to consumers, eliminating much of the transportation, environment and financial costs. Also, here I think it depends. I see a lot of space for hydroponic, especially on the leafy green side of things. So the salads, maybe some tomatoes and a lot of those, many of them are not as energy efficient as you would like.
Speaker 1:So I would, as an investor, I would always ask the question show me the full circle, like show me how much input it actually takes. Obviously, anything grown that doesn't need a lot of transportation is something to look at. But often in these systems they claim 100% closed loop with either fish or something else, but there's always obviously inputs going in because nothing. I mean you need some kind of fertilizer liquids, you need something to grow plants. They don't grow out of nothing, especially not in soil, not outside soil. So I would very much look at the full input and output, like how much energy, how much input? Where is it coming from? Is that a risk, potentially in pandemics, when suddenly a certain fertilizer might not be delivered anymore, etc. Etc. Etc.
Speaker 1:And I have done, I think, maybe one interview on greenhouses and slightly more controlled environment, also because there are huge limitations of how much we can actually grow like how much of our daily diet can we grow in greenhouses or can we grow inside? Can we grow in hydroponic systems? And most of our calories come from a few crops unfortunately wheat, rice, et cetera and they also occupy most of our land. So if we want to have the impact on carbon, on water, on farm workers, on a lot of hectares or acres, I think we're going to look mostly actually not to the vegetables, but mostly to tree crops, mostly to weed, mostly to large, broad acre farms and land, because that's what occupies so much of our planet, unfortunately Obviously largely used for animal feed, which is something that fundamentally has to change. So I see a lot of potential there to reduce all the chemicals, to reduce the tillage, reduce the fertilizer, and obviously I applaud any work that's being done in vegetables, in leafy greens. But I would really look at the full input and output cycle, because there's a lot. I see some of these decks and we come back to Martijn that really seem too good to be true, like you, only you put a solar panel and and these grow basically without inputs and that's simply, I would argue, not possible, and so really really have a deep understanding of that, but I think it's part of the puzzle. Maybe a small part, but it's definitely part of the puzzle. But it's definitely part of the puzzle. Thanks, kelly Alexandra.
Speaker 1:What's most lacking on farm or farmers on farm? For farmers to require for the transition towards regen from conventional Data is obviously an issue in part that's not available. Testing soil is extremely difficult. And how to organize, enable decision-making support for farmers that brings all of the variables, including profitability and market access, together. Who's leading in this technology?
Speaker 1:So she sent two questions. Let's answer the first one first. I think decision-making support is absolutely crucial. There are an enormous amount of apps coming on the market that claim to do that. I don't have the answer which one actually works. Probably it really depends on the crop types where you are, but I do have a few questions I would always ask any of these ag tech companies Probably. The first one is when is the last time you talked to a farmer and is there a farmer on your board? Is there actually a representative of the group you you're trying to reach? And you'll be surprised you would think all of all of them at least have a co-founder like you cannot do this without understanding your community of grain farmers in the midwest, or you cannot do this without understanding your potato growers in the netherlands, but you'll be surprised how many meaning very, very well. But come out out of this from we have to digitalize the farmers and coming out of it from a very we have to teach them something and we will show them how it's done, because they are behind on X Y, z, you'll be surprised.
Speaker 1:I know farmers that have bought the latest drones when they came out and they were 15,000 euros and have an amount of data that you can just not even process to begin with. So there's definitely a huge need to help farmers decide. They have a very limited amount of time. They usually have 40, 50 harvests and need to make huge decisions on very thin margins. So I don't know which ones are going to lead that. I think we're going to see a spectrum of some case farmer led, because they much better understand what's there. Obviously it's very different than running a tech company, but I would be very careful with a lot of ag tech companies and see how much they actually understand and are part of the regen ag movement and obviously, in your investment decisions, always take into consideration the investment advice of a few forward-thinking region farmers. They are very good at filtering the noise from the actually interesting things because they need to make those decisions every day, and so tech is going to be crucial.
Speaker 1:I don't think we can all imagine what's going to be possible in a number of years and from robotica to software to making good farmers decisions what to plant where and why, which is still a very underdeveloped piece but it's going to be very difficult to get a connection with a large amount of a group of farmers big enough to actually make that a valuable business without obviously taking the data, selling it off and doing the traditional model which has made farmers very, let's say, skeptical of outsiders coming in with the latest techno gizmo to help them. Does it answer your first question, alexander? Yes. Your second question on carbon market potential what are your views on this? How, when and who? That's a really good question where we can again spend an hour on how I think most of the models so far have been, or most of the business so far have been, based on models either Comet farm or some others I I don't see and those models have been based on a lot of academic research which has shown in the past to really either very underestimate or not take into consideration a lot of the carbon parts. So I see some test farms actually which are profitable, or commercial farms that are doing twice the rate of what Comet Farm predicted in terms of carbon sequestration. It doesn't mean that they are right, it means that we just don't know, and so I think we're going to see a lot of actually to really try to actual measure it and not based on a model. It's going to be very difficult. So that probably answers your when not tomorrow, but the customers are going to want to see this. Customers are going to buy carbon credits, removal credits, storage and I bought them through Nori, for instance, and I actually have an interview coming out next week with Nori, not to plug it, but they are. They're definitely building a piece of the puzzle there, but it's very. I think customers, the front runners, all of us probably will buy them because we just want this to happen. But later stage, where customers are going to ask for, can you actually prove that this has been stored and that this has been stored over a long time, and then hopefully we're going to see.
Speaker 1:That's the second part of your question. What's the role of agroforestry inclusion in region farms and we're going to see, hopefully, then a race for, okay, what's the fastest sequestration farm we can design, if that's what you want, if you want most biomass, if you want most produce, if you want most carbon. I think we're going to see different models compete and I don't see why trees are not going to be part of that, for all the extra benefits they have. But obviously they have a huge benefit on carbon and so I think, until they are a part of the models, or until we're going to measure actual carbon sequestration and actually how long that's going to be, you're going to measure actual carbon sequestration and actually how long that's going to be. You're going to struggle on that piece, but there will be a lot of interest in the space because people wake up daily for the amount of what we can actually do in terms of soil management, both above ground and underground, that the interest for this is just going to explode Again. There's going to be a lot of noise, so it's going to be asking the right questions and who's actually actually farmers first? I think also here, who actually includes farmers in the decision making process and in the design process? Because, at the end of the day, you're not going to get millions of farmers to sign up if you don't really and to actually get them for to commit for 10 or 15 years if you don't really build this from the ground up with farmers. Does that answer your second question, which is a huge issue? Yeah, we're very early. That's the.
Speaker 1:I think the and there's a big open question will be just carbon. Will it be water? Maybe moving first? Will it be all three? So biodiversity, carbon and water. What other? Because we can make a whole list of ecosystem services, obviously around that. So I'm going to move to Claude.
Speaker 1:Is there a minimum dimension of the land to start thinking to switch to region ag? I don't think so. I think there's. I mean, probably a square meter is very small, but um, I, I would say from the farmers, I know the principles, they're the, the approaches um really differ, obviously in terms of, of context and place. Could be a smallholder farmer in ghana, could be a large-scale farmer in the midwest, but the, the principles are always the same, which is about same, which is about ground cover, which is about very no or very little disturbance of the soil, which is about complex rotations both in time and in place, meaning both obviously over the years, but also in the same place, meaning no monoculture approaches. So the principles of all these farmers, big and small, fully organic or somewhere on the way, are usually the same, which sort of indicates that it's a set of principles that could be applied on a soccer field or could be applied on your backyard garden, which maybe allows you to do a lot more things than you would otherwise not be allowed, because you basically can monitor very easily and do a lot of things by hand and do a lot of things by hand.
Speaker 1:So it seems to be all the way from very intensive, small scale permaculture to very extensive thousands of hectares of agroforestry systems. It seems to be scaling quite nicely, but it's very context dependent and that makes it so difficult for funds to operate, for things to sell in, for inputs to develop, because it really really really depends where you are, and that makes it very tricky also to build companies that could be huge, because how many can you really serve with your input supply? How many can you really help in terms of training if your approach maybe only works in this bio region? So it also challenged a lot of that. But I don't think but please correct me if I'm wrong that there's necessarily a dimension small scale or large scale. Obviously you want to be commercially farming. That's a different discussion, but also there it depends on context. I've seen people very comfortably getting a family income of a very small plot and I've seen, obviously, farmers at a huge scale that are not even, that are below the poverty line. So it really depends, frank.
Speaker 1:What does regenerative farming really implies? Is it biological Food sources, which I think are food forests, or permaculture? So it's primarily an approach of. It could imply all of these, but it's a primarily approach to a farmer or a land owner or land user to rebuilding soil. Most soil are extremely degraded and so it's a set of principles, it's a set of approaches to to build basically soil, and that could mean a range of different things. Could be that you're applying permaculture. I've seen many that are mixing things. They are using certain approaches from permaculture, they're using certain approaches from organic agriculture, they're using certain approaches from food forests. It really depends on the context, but it's keeping the ground covered at all time, using complex rotations in time and space. No, or very, very low, depending on the location, but usually no tillage and there's an element of probably at some point integrating livestock into a certain into the rotation, but also that really depends on location. So it's a context specific set which I usually say.
Speaker 1:It goes way beyond organic. But the very simple one is to ask your farmer are you building soil or not? And the regen farmers is interesting because you usually have a very long discussion when you first met them, meet them, not about their produce, not about the oranges they grow, not about whatever vegetables they grow, but actually about their soil. So you can sort of spot the regenerative farmers because they're more actually about their soil. So you can sort of spot the regenerative farmers because they're more enthusiastic about their soil growing than the produce which sort of happens to be a byproduct. So it's quite interesting. I've seen regenerative livestock so actually a chicken operation that have mainly talked about grass and only after an hour we somehow got to oh yeah, but I'm actually to grow the grass, I'm using this and this, this principles, um. So it's an interesting, it's a different mindset, um, not making it easier or less easy, obviously, than than organic. But organic is much more established in terms of do this, this and this, and you can be organic and don't do this in terms of regenerative.
Speaker 1:It's it's a bit more fluid, but it all comes down to generative. It's a bit more fluid, but it all comes down to are you building soil? And are you building soil at least in my case, at scale? Willem shared a fund, aquaspark, which is very personal to me because I used to work there. Thank you for sharing that and I mean, I think it triggers an interesting thought, in the sense that I've only interviewed one or two, I think, but there's a huge space we never cover when we talk about region ag, which is obviously the oceans, and there's an enormous potential, from seaweed farming to mix cropping also there, and I think we are only just scratching the surface of what is possible when we restore the oceans.
Speaker 1:And there you can ask exactly the same question to any fish investment or any ocean investment you might be considering are you restoring the oceans and, if so, how are you measuring it? Can you report on it? And I think the potential there in terms of climate, in terms of nutrients, in terms of fixing runoff issues, is probably, maybe even bigger than in all the land area combined, because it's just so much bigger. And it turns out that, for instance, there's some research coming out in terms of whales that are sort of the grazers of the ocean and actually storing an enormous amount of CO2 and restoring just the whale population would already help a lot. So there's a lot of things there. They see Zara on the call in terms of seaweed, which she knows much more about that there's to discover, discover and actually they're very interesting connections between farms runoff obviously, but also farms and the nearby ocean or the nearby sea in terms of seaweed which can be used as a fertilizer and obviously captures a lot of the runoff Seaweed can obviously be eaten, and so there's a lot to discover there.
Speaker 1:I'm definitely planning to do more there, also considering my history at AquaSpark and I see a link here which I will not click on now Willem regenerative resources, an American organization looking for funds. I will dive into that after. Can you, yeah sure, which is an NGO? Yeah, so there are definitely places. I would. There are a lot of places to have these discussions, but an easy list. There's Soil Wealth, which is a big report. If somebody could put it in the chat that would be great but it's mostly US and a very small percentage of the funds they have listed are actively measuring soil health. So I would always argue ask for measurement, active measurement of soil health, but it's definitely growing like every day. I had a discussion two days ago about a group that is launching, now obviously paused, um a regenerative. They call it sustainable, but it was for for different reasons. Let's say, regenerative public uh, publicly listed um farmland income trust on the london stock exchange won't be listed for the next few weeks because nothing is listed, but that would mean that it's suddenly accessible for retail investors and so there are a lot of people thinking about vehicles to make this accessible and start financing this transition. Thank you, willem, for sharing those.
Speaker 1:Okay, I was trying to catch up because otherwise we're never going to get through this. I see a question of Janessa. A few of my Californian growers are looking. I'm just quickly scanning it because otherwise I'm reading it all. So she's asking if there are any advisors, slash consultants, that could help her Californian growers to switch. So there are many, many I would quote unquote gurus in this space and many advisors and consultants. It hasn't been organized very well so far that you can easily search and find who in your crop type, area, et cetera, is very good.
Speaker 1:So the answer is I don't know, and I know that Ag Talent, who I interviewed, is trying to do this mostly for the Australian market, but I think we definitely need better searchable directories et cetera. I'm sure they are there, but I haven't seen too many. Let's say, these consultants come recommended lists or something like that. So that's actually an opportunity. Like we need many of these agronomists, independent, not paid by the input companies to help growers and to help corporatives or to help groups of farmers to transition. Actually, soil capital but it's very European focused at the moment is working on just that to basically build an army of independent agronomists that have experience in region. Ag are being trained to really be even more experienced and are not paid by the input company, so are free to advise and not basically have to sell anything, because usually these are normally their salespeople. So Soil Capital is working on it unfortunately not in in California, but you might could reach out to them to see if they know anybody.
Speaker 1:So Zara is asking a question where do you see the role of product innovation currently work? I'm working on algae-based soil regeneration and drought mitigation. Are these opportunities out there for early stage innovations? Do you know any farmers, groups or organizations in Europe who want to co-create? I'm not a techie, I'm a permaculture gardener, so that's a good question. There are many far. How do you would find you? You're basically asking what are, what could be, early adopters of the work you're doing? Thank you, yeah, I think what it really depends where you are, but you're you're based in in Western Europe, right? Yeah, so it would definitely in in, in this case, in the Netherlands.
Speaker 1:Find groups like common land, or find groups of farmers of violence that are already at least case in the Netherlands. Find groups like Commonland, or find groups of farmers of Weiland that are already at least somewhere in the transition and to test with them. I know a number of farmers that actually have used, also in the Netherlands, seaweed as fertilizer or are also using it, obviously as a livestock feed ingredient, which greatly reduced the methane. So it's finding those groups of farmers could be the food, yeah, yeah. So finding those groups of early adopters that are willing to donate or make available one or two hectares just to try a few things. And and they, yes, it's the the common land project just north of Amsterdam, with a, with a big group of farmers. So they are definitely, let's say, on the front end of this, plus a lot of the farmers. They would know all the other farmers in Europe, or in the Netherlands as well, that are potentially open to this.
Speaker 1:Sure, and with you you mean you as a seaweed project, or me. For me, I've very similar to my view on impact investing. I've spent a lot of time trying to convince people of certain things. I don't think that's very effective, so I decided to focus on the front runners and to focus on people that I'm always happy to share something on soil, obviously, but to help the front runners to go faster and to do more, because I think we're going to see more change faster. If we had 100 years, I wouldn't be too worried, because most farmers will at some point discover and will start focusing on. We'll go deep into YouTube and find Gabe Brown and others and start learning and we'll be fine. But we have 10, 15 years, so convincing is going to take, at least in my personal view, too long, and so we either incentivize through carbon payments, offtake agreements and other, or we partner with with the front runners to to move faster and communicate about it. So we obviously create more frontrunners otherwise and let's go down the list, because otherwise, tekla, do you see big opportunities in Ocean? Yes, I think we already answered that, so let's keep moving.
Speaker 1:Sam, I'm the director of Mein Stadstein, which is an urban farm in Amsterdam, regen Ag Principles. We're looking for investments mainly for a center of excellence on regen farming. What would be the most sufficient way to find investments? It's a very difficult question because obviously the answer is it depends. Um. I would argue mostly for any type of um investments like this, which is an urban farm located in amsterdam, to try to find it as much as possible locally. Um, you need people with a connection locally. I mean, it's one thing if you're in the middle of nowhere in the center of France and maybe locally there's not so much capital around, but in this case you're in Amsterdam, which is obviously one of the financial centers of Europe, and I would really try to find people with a connection to this space and try to figure out if you're honestly looking for an investment or a grant or a mix, and get first of all very, very, very clear what you're looking for and why because it's the first question any funder or investor will ask and then really search for a local connection, because you're going to need that to to compete with any other investment decks etc. That investors are going to get. Does it answer your question, sam? I saw you unmuted. But get really, really clear what you need it for and why. Because maybe you don't and and smart investors will will see through that immediately. I see many people to say I am gonna raise capital, I need to raise capital, but after two or three questions of why, why? Why? Probably it's not the case, or probably they don't need it, or there are other ways to raise capital or to to grow and scale. Thanks, jeff.
Speaker 1:Um, the publicly listed company. It's not publicly listed. They were supposed to launch I'm looking at the day a month ago which obviously got shelved. So I I hope to do an interview anytime soon. They are thinking about somewhere this year. So no listed yet. You can search, but I don't think you will find it. Maybe I mean they're public but they're not publicly listed yet.
Speaker 1:Then we get to Willem. There is a list of consultants. I will look into that. Eltinitiative. So for consultants Jan consultants, janessa villain, put something in the in the chat box if you want to have a look.
Speaker 1:Alexandra john kempf definitely interesting to speak with. I had him on the phone yesterday. Actually very interesting guy, john kempf, a very interesting podcast for anybody interested in podcasts. Otherwise you're not here. Um on um, his company is called advancing eco agriculture and they do a lot of work also in california. So, um, I cannot I haven't worked with him in terms of as a consultant, so I cannot as a farmer, but definitely somebody to uh, um, to reach out, to chuck also in has been on the podcast of. So capital knows him well. Um, yeah, and we actually met in oakland at the investment the regenerative food system investment forum. So that, thank you, alexandra, for sharing that. So Capital knows him well. Yeah, and we actually met in Oakland at the investment the Regenerative Food System Investment Forum. So thank you, alexandra, for sharing that Interesting podcast. They share a lot, they share a lot of webinars, they share a lot of information, and that's actually the list.
Speaker 1:So if anybody has another question, please unmute yourself. Oh, there's another one, yours. Can you sketch several scenarios of how a transition to region I could look like in terms of time? And yours, can you unmute yourself and maybe? Thank you, yeah, sure, so I wouldn't be doing this if I didn't think it would make a considerable carbon difference in the next 10 to 15 years, because that's probably pretty much the window we have.
Speaker 1:The answer is, again, it really depends on the farm and the location. We've seen, or I've seen, changes, especially if you have. It also depends on the climate. Obviously, stuff grows a lot faster in tropics, where things happen a lot faster. So if you're looking for the fastest growth of soil or biomass of anything, definitely pick the climate to do that. The climate is extremely important to that. But if you're looking for the most degraded soils, you probably get to the areas which has been farmed the longest. And so if you want the biggest bang for your buck, probably you will look at heavily degraded soil that have been in conventional, chemical driven agriculture for the longest and bring in quite a bit of biomass, which is a lot of compost, and start to figure out okay, what's the quickest one? I want to do, but it really depends.
Speaker 1:If you need to live off the cashflow during that transition, obviously you make smaller steps. If you need to live off the cash flow during that transition, obviously you make smaller steps. If you have a 10-year window or a five-year window, you don't need any cash flow out of the business. You can also do certain things that otherwise you can't. So it can go quite fast. We've seen changes in produce, in levels of zinc, et cetera, in one or two seasons and from changing management practices.
Speaker 1:But to really build up trees, to build up advanced agroforestry systems especially not in the tropics you need seven to ten years because it takes time for the trees to grow. We can speed it up in a lot of ways by changing the tree planting methods, by selecting other types, etc. So it's both fast and slow and really depending on the location. But I think you would be surprised, if you visit the most advanced one, how fast things can go. Um, if we get the right processes, mostly in systems in place. But it's a lot of knowledge that we're developing now in terms of what's actually the speed of things we can do. And and it's constantly surprised me of how fast things are Um, but it if you have a typical grain field and you're going to switch to a 10 year rotation and you're bringing in five or 10 types of cover crops, it will take a bit of time before the soil starts to recover from all the chemicals and starts to actually slowly live again.
Speaker 1:It might take three to five years just to get through the shock of less fertilizer and to get through the shock of less chemicals. So it really depends what you start with. If you want to have the fastest carbon, it usually ends up being, like Alex Funder mentioned, some kind of system with trees involved and you need fast growing species in a mix with others, et cetera. Does that answer your question? I see Julia sent another question by email which I'm not going to check now so I will get back to that. There is a farmland read which I'm also not going to click on it, but thank you, augusto, for sharing. I will have a look. Not sure if they have a strong regen ag focus when they don't mention anything. They don't, but it's. I'm always happy to be to be surprised, obviously.
Speaker 1:And martin is asking what budget would be required to set up a large scale region farm in the netherlands and what would be reasonable annual return expectations. That's a question I really don't know. I know the. I think the average hectare costs are about 80 to 90 000, so it depends what you mean by large scale. But that's if you want to buy land. That's pretty much what you're looking at. And then you need still the capital on top of that to to obviously start making investments. I'm seeing, in terms of annual return, that's maybe some. I see some funds now or vehicles that are being set up in the US and they're targeting, let's say, eight to 12% on an annual basis, which is partly coming from the produce, partly from the asset growing in or getting a higher valuation. So those are the numbers they are looking at and they're raising capital, which seems that investors are liking that, and what that would mean in the Netherlands, I don't know, because I don't think anybody has done that and you'll be figuring out.
Speaker 1:What are the offtake agreements needed? Who's buying? Is somebody buying the carbon, which obviously influences your return quite a bit because it's free extra cash? Are you going for a 10-year system, which means you involve a lot of trees, which means you have to wait? Do you need to live with the cash flow? It's an interesting exercise. I think some people in Netherlands would be interested to look at that.
Speaker 1:It really depends on large scale. If you're buying land, a lot of your money will be locked into buying the land, and that just limits what you can do. That's one of the reasons I'm not focusing only, for instance, on large funds that are raising capital to buy land, because I think there's a limit of how much money there's available to get into those funds, even if they raise 10 billion, et cetera, how much actual land can we buy and thus influence with that is limited. And if you look at systems or processes or vehicles that are working with farmers, this potential to scale is much higher because you don't need to buy the land and you don't have, obviously, the whole discussion on land ownership. So there's definitely there's a lot of learnings in these large funds because they operate at a large scale, but I think there's also sort of natural limit of how much they can actually raise and how much hectares and acres we can influence with that. But we need them, I think, in terms of lessons learned. We need them in terms of CO2 now we need them in terms of large offtake agreements. There's a lot of people going to be trained on those farms to do this at scale, which is absolutely essential because we don't have enough farmers that are able to do this multi-cropping, very complex rotations of 15 types of cover crops, mixing in with, et cetera, et cetera. There are not many people that can do that and want to do that honestly, at remote locations, et cetera. So I think a lot of the capital will be locked into the land, which is maybe something to consider if you want to have the most impact.
Speaker 1:Anastasia, hello from Greece. We grow cherries and figs. If anybody or anyone is interested, let's connect. So definitely anybody that's interested in cherries and figs, maybe from Mediterranean countries, please connect with Anastasia. Alexandra is a longer conversation, which is interesting because we're on top of the hour.
Speaker 1:The investment thesis for rewilding very interesting question it as one of the most listened episodes. Definitely read the book if you haven't. Uh, isabella tree obviously she's called tree. Um, fascinating book. Anything you thought, anything I thought at least, about nature, was being debunked. I think 15 times in that book alone. Um, and thought about rewilding management how much do you have to do and how much you kind of do, how fast can nature come back?
Speaker 1:So it comes back to your question, yours and I think there's a very interesting case of integrating rewilding into rotations. So there are two cases. I think there's a very interesting to integrate rewilding into rotations. What would happen if you managed rewilding? So it's not just putting a fence and wait, but actually manage the process and integrate certain things and actually speed up the process of rewilding. What if that will be part of a 20-year rotation? So you have a 20-year rewilding and then you go back to regenerative ag for a few years and you go back to so you sort of move in and out. What would that mean for nutrient levels? I think that's a very like what would the produce do when that comes off the land.
Speaker 1:And I think it's the second part and we talked a bit about that in the interview is how do you integrate this into farms, into pieces that are not extremely productive? How do you rewild pieces of your farm, of your operation, that are anyway not the most economically profitable pieces, and how can you manage that actively to let biodiversity simply explode? And I think Isabella and her husband Charlie have shown that you can actually go on safari in just south of London and see an amount of biodiversity that if somebody said that 20 years ago that that would grow there and say they have more nightingales than most of the wildlife areas nearby. And so it challenges a lot of our thought about how an area should look like in terms of forest versus open, canopy oak trees, large animals, many, many insects, and so I think there's a huge role. So far, they're mostly two different worlds. We're not really talking. The region egg people and the rewilding people are not really talking. I think that's a huge mistake because we're after the same things and I think there's a lot of integration and that can happen, trudy, so actually Sam sent a message to Martijn, which Martijn can answer. What do you think about large scale, trudy?
Speaker 1:Can you say more about funding that it takes for the ownership of land versus the funding that supports the farmers and owners to transition, to redirect? Is funding that it takes for the ownership a bad deal for the farmer? Here it really depends on what the farmer wants to do in the farmer family. I've seen examples in Canada. I just want to say sorry, we're on top of the hour. If anybody wants to leave, obviously feel free. Also before I will finish these questions and which might mean that we're around 10 minutes over or something, but feel free to to jump to your next call, jump to a coffee or tea, whatever you are, but I will try to finish these questions and then call it a day. Can you say something about the funding, what she asked? So I've seen examples of people taking outside capital to buy land of their neighbors and then slowly growing into that. In Canada I've seen examples of so. There are many, many flavors.
Speaker 1:I think it really depends what the farmer wants to do. If a comfortable size is what they already have, there's no need to buy other land. If it's more comfortable on the long term to have the land in a trust which is governed by a certain set of principles and then the farmer leases the land to a certain long period. I mean there's so many shapes and forms available there. I think there's a larger discussion we need to have on land ownership and does it make sense to have that in a very concentrated group of people. But that's part of the Regenec discussion as well and I think we're going to have a lot of different shapes and forms of trusts, of farms buying other farms, of groups of people getting together, forming a cooperative and buying large farms for their food, et cetera, et cetera. So I don't see. I think the impact is going to be working with current farmers, simply because they already have the land and they need to transition, and the largest, the fastest the hectares we can do are probably from partnering with current farmers and land owners, because they could be also investment funds that already have the land but don't know what to do or don't know how to. They're probably underperforming what they could do there there somebody nicely said underperforming landscapes and which for investors, should be, should be quite interesting.
Speaker 1:Alexandra is asking how important is certification, and that's an open question. I have no idea. I see obviously Patagonia and dr Bronner's and and Roda working an ROC, regener, regenerative organic certification, which is interesting and raises a million and a half questions. I really don't know. I think it really depends on if consumers need certification and or we're going down a nutrient density route, and so if we're going down a nutrient density route and we're going to communicate on what's actually in your food, maybe certification isn't needed anymore. But I don't know. I think time will only tell. Sorry, not not a very satisfying answer right now.
Speaker 1:Augusto, do you believe the lack of wildly accepted ESG frameworks to evaluate farming investments remain a key roadblock? I think that the lack of accepted ESG is a key roadblock for anything in impact investing, so also in regenerative agriculture. I think the SAVERY certification is based on outcome, which is very interesting. Rodale ROC is still very early but also very interesting. So time will tell. I think it's the same answer to Alexander's question. We can only wait and get involved as investors, practitioners, farmers to make sure we shape these to something that serves all of us and not just certification bodies, not just consumers, but actually obviously farmers and get all stakeholders on here.
Speaker 1:Does the EU common agriculture policy encourage region egg? At the moment not, or very, very little. There's a lot of work and lobbying being done to try to change that and actually on the so at the moment it's not extremely helpful and I think you can ask 20 farmers and most of them will tell you that a lot of the legislation, a lot of the subsidy schemes are actually against a lot of these things because they pay you to plow or they pay you to do certain practices which have been outdated for already 20 years. So for the moment not. I know there's a lot of work being done by a number of European bodies to change that, but of course there's an enormous lobby effort from mostly the input companies, because that's what they are depending on, which is their livelihood. So we're gonna see the same kind of lobbying we see with fossil fuel it's a very similar, probably using the same lobby groups actually to do that.
Speaker 1:Thank you, sarah, for sharing the book, and I think that's it. I reached the end of the questions. Thank you so much, for if anybody has a question, definitely unmute now and otherwise we'll. We'll call it a day and, uh, I will do this another time soon. I hope it was interesting, relevant, and have a nice evening, nice morning wherever you are, or a nice night, actually, if you're in Singapore, because I know some called it. Thank you so much.
