Profitability Troubles After One Year of Regenerative Farming
We are good techies but pretty bad farmers. When something starts with that caveat, you know what is coming right? ;-)
Jokes aside, one of the reasons why we decided to setup our agritech company on a farm in rural Tamil Nadu is to get first-hand knowledge of the trials and triumphs that farmers face when they convert to regenerative agriculture. We wanted our lived experience to be as close as possible to the farming communities that we hope to serve. On that note, and with very high hopes, we started a handful of demo farms to showcase a profitable & regenerative smallholder agriculture. Here is the first-year report from that effort.
If you are in a hurry to know the climax — we scored:
- Poor in adding economic value, and
- Excellent in regenerative agroecology.
- Part 1 (this article) covers the economic value derived — or lack thereof! :-/.
- Part 2, Soil Will Save Us article, covers the regenerative agroecology component.
Poor Enabling Ecosystem
Agrarian crisis in India is a multi-tentacled monster that holds farmers in its vice grip. Conventional farmers at least have a support network that helps them face some of these issues. However, a farmer who is trying to convert to regenerative agriculture faces this monster on their own without an enabling ecosystem. Let me elaborate based on our experience.
Once upon a time, our region was known for its cotton. A whole host of ginning mills and ancillary industries even gained Coimbatore the moniker “Manchester of India.” That is the past. What is the current trend? There is a growing demand for organic cotton and natural dyes. Based on all these factors, we decided to grow organic Karunganni cotton, a variety that is native to this region. Karunganni is a hardier variety and better suited to our climate. Indigo was going to be the companion crop. The idea was that it will be a good option for the polluting dyeing industry to switch to a plant-based dye. In addition, indigo’s nitrogen fixing nature is also good for the soil.
The first difficulty we faced was in sourcing seeds. Cotton seeds were much easier to find, thanks to Tula India that is trying to revive native cotton varieties and transform the fiber’s value chain. Indigo seed procurement was a study in the difficulty of sourcing organic planting material. After a long search, we found two different indigo seed sources. Both promised that the seed quality is great. However, it is only after the seeds started germinating did we find that the one set of seeds were of really poor quality. This was ok for us since we could chalk this up to a great learning experience. What of the farmer for whom this is livelihood?
The next big hurdle was after harvest. The crops grew well. We were quite happy…until we got to the post-harvest processing. We realized pretty quickly that there were no processing facilities for either of those crops within manageable distance. Karunganni cotton seeds are smaller than the genetically modified BT Cotton which is widely grown all over India. Unfortunately, the ginning machines in our region are mostly designed for large volumes of BT Cotton. If you have a small lot of the small-seeded native Karunganni cotton, then you are out of luck. There was a similar problem with indigo as well. It was not enough to just grow these crops. We needed a processing infrastructure that did not exist. This has resulted in crops sitting unsold. Or, being given away for free (did you know that indigo is a great natural alternate for chemical hair dyes? ;-)).
On a related note — a few months into this experiment, we had to shrink our demo farm experiment from 4 farms to 1. One of the main reasons for this was the difficulty in finding farm labor. Given the high unemployment rate in India, this may come as a surprise. This is a complex topic that we may address in the future. Suffice it to say that this is an ongoing trouble that everyone — from smallholders to large farmers — are facing.
Our first-year experience, especially in the area of financial profitability highlights a critical problem/opportunity: How might we create an enabling ecosystem — seeds, small lot handling, post-harvest processing, etc., — for regenerative agroecology? This is a problem that needs to be addressed with some urgency. The solution also cannot possibly be “involve more manual labor” for some of the reasons stated above.
Overall grade on profitability: Fail! :-/
Hopefully we can bring better news next year.
