Steele, N.D., farmer and entrepreneur moves processing operations
LONG PRAIRIE, Minn. — Monte Benz is a North Dakota farmer and vegetable processor who has picked up much of his processing operations and moved it out of state — mostly to find workers and labor infrastructure.
On May 10, Benz, of Steele, N.D., and partners John and Dan Brown, of Browerville, Minn., started making vacuum-sealed vegetable packages at Minnesota Fresh Inc., in Long Prairie, Minn.
The Brown brothers have experience in meat packing and red potato growing. John, 37, who worked as a supervisor in local food plants, is operations manager.
Minnesota Fresh spent more than $1 million upgrading an existing building into a food-grade processing facility. They make about 20 kinds of meal kits, ranging from 10 to 30 ounces. Most packages feed a family of four. The main categories are red and yellow B-size potato combinations, which make up more than half of the package weights. They include an onion and a mix of other vegetables.
The region includes numerous small towns and a good supply of labor. "Good food safety people," John says. "There's very good, hardworking farm background people. The work ethic here is very good."
Minnesota Fresh has the ability to put out 15,000 units per day, five days a week. The new processing plant includes about 40 people, and they are already making plans to expand.
Feel of Steele
Benz, 61, grew up in Hazelton, N.D. His father, Lloyd, was a truck driver and the family started a hobby farm in 1978. In 1982, they moved to Steele, N.D., where they started Benz Farm, a 2,500-acre farm that had 200 irrigated acres.
Monte started irrigating in 1983, initially growing conventional crops — corn and soybeans. He managed crops under as many as 32 pivots on about 4,000 acres, including rented land. In 1994 he started raising potatoes in a joint venture with Jamestown, N.D., businessman Maynard Helgaas. They initially grew for the Simplot plant in Grand Forks, N.D., and later for the Aviko LLC (now Cavendish Foods) plant near at Jamestown, N.D. Monte quit spuds in 2007 because of tighter rotations and higher input costs.
In 2001, he was part of a group that started raising 100 acres of onions under irrigation on a field-delivery contract. On Sept. 11, 2001, they had 22 semi-loads on the road heading for Hannover, Md., when al-Qaeda terrorists attacked the Twin Towers in New York.
The stranded onions were taken to temporary storage at Hollandale, Minn. The company hauled onions through the winter, and remaining partners decided to get into the whole-peeled onion processing business themselves, so they wouldn't have to rely on a processor.
The group, named Kidco Farms, expanded to 400 acres in one year, but scaled back annually until they quit processing onions entirely in 2006. On July 9, 2007, Kidco Farms Processing started making the mixed-vegetable vacuum-sealed products using outsourced onions, and aimed at the slow-cooker meal market. They started with eight people around a stainless steel table, handing packages around and hand-filling.
Benz Farm restarted with onions in 2008 with 10 acres, and gradually expanded.
In 2009, they decided to package bulk onions in 50-pound bags, and often struggled to get paid. Business picked up in 2010 and in 2012, and Kidco Farms Processing became a direct marketer, without involving a marketing partner.
Kidco Farms Processing today is made up of Benz and Van Amundsen, who is the only person to have been president of the North Dakota Stockmen's Association and the Northern Plains Potato Growers.
The Kidco Farms expansion coincided with the expansion of the Bakken Oil Patch in northwest North Dakota, which meant competition for employees. From 2011 to 2013 they also processed at a building in Steele, making fajita products from bell peppers and onions — employing another 21 people.
In 2014, Kidco Farms Processing ceased in Dawson and Steele, and shipped its equipment to a co-pack facility in northern Kentucky. Kidco Farms Processing in Dawson continued to source and pre-grade raw onions and potatoes.
Benz says he's made mistakes.
He needed 40 workers most days through a five- or six-day week in Dawson and Steele. He often woke at 3:30 a.m. to drive two hours from Steele to Fargo, where he would hire a dozen laborers and have them on the job at 8 a.m. For months, he made the same round trip in the evenings. Eventually, he was approached by an out-of-state contractor who supplied labor.
Kidco Farms provided housing for the workers in Steele and Dawson — similar to oil industry workers — and provided shuttle transportation every other week to Bismarck, about 50 miles away.
His plan backfired.
Government officials discovered the contractor was hiring undocumented workers. Benz pled guilty to "reckless disregard" of harboring undocumented workers. "I accepted full responsibility because it took place under my watch," Benz says. He says part of the problem is the general state of the American labor market, and the other is, he is too trusting.
Too many American citizens are capable of working but don't because there are too many support programs available, he thinks.
"When people can get most of what they want without having to go to a job, why would they work," he says.
It takes about 100 acres of onions for today's processing in Kidco Farms-
related entities. An acre of irrigated land produces about 40,000 pounds, or 180,000 onions. About 50 acres come from Benz Farm in Dawson and about 20 acres are from the Browns in Long Prairie. Another 30 acres are from other areas.
Kidco Farms supplies Minnesota Fresh, which sends products to grocery stores for the regional retail grocery chains, starting with the Minneapolis and St. Paul area.
Their retail brand is "Ma's Fresh Garden Blends," and the products are packaged with low bacteria.
"Fresh vegetables are very perishable, so doing it for 30 days is something nobody else has been able to do, especially with blends," Benz says.
Potatoes in the packages are whole, not cut or processed.
Further processing adds value to the products, but it also takes out some of the market variability for farmers. "When we were growing onions and potatoes for just the open market we didn't know where our end income was going to be," he says. "There were contracts, but it was all based on quality, which is ordinary these days."
He's now the potato buyer, setting the quality standards. "We take a No. 1 grade and they pull out 15 to 20 percent to meet our standards," Benz says. Some of the off-spec potatoes from Dawson go to food banks. By the end of July, they'll add a pre-grading site for potatoes in the Long Prairie area, at a separate facility owned by Brown Produce.
Benz is glad to be in a location where people pick up job applications and Benz doesn't have to give them a ride to work. He says his biggest satisfaction is surviving to be in a position to expand and thrive in a value-added ag venture that might have closed its doors on more than one occasion.
The mantra of an entrepreneur is expecting setbacks, and overcoming them, Benz says. "You don't let it stop you. You stand up and start over again when you believe in something."