From Organic Farming to a Nationwide Food Network: David Stelzer of Azure Standard Ep. 124

0:00Howdy Eco Farmers, welcome to the Acres USA Podcast, a conversational podcast where we will explore sustainable farming, real-world regenerative practices, and the latest innovations in technology shaping the future of ecological agriculture with some of your favorite farmers and ranchers. This episode of the podcast is proudly supported by Azure Standard and American Farmland Trust. Two organizations that are deeply committed to strengthening farms, building healthier food systems, and promoting land stewardship across the country. I'm your host, Taylor Henry, the owner and CEO of Acres USA. Now let's get into today's conversation. Welcome to the Acres USA Podcast. I'm joined today by David Stelser of Azure Standard. Azure is one of the sponsors of the podcast, and David and Azure will be at ECOA conference this year, December 1st through the 4th. We're excited to have them. I'm very honored to talk to you. It's amazing what you've done with your company.

1:00Your family was farming organically before. Most people even knew what organic meant, probably right around the same time, Acres was founded and what eventually became Azure Standard started remarkably simple growing food and figuring out how to get it directly to people who wanted it. It sounds simple, but I'm sure there's a lot of complexities and war stories over the growth over the years. I think I'd like to spend some time talking about your childhood, your family. Awesome. Thank you. Thanks for having me. Absolutely. You grew up on a farm. You had mentioned a little bit before when we were talking before we started recording that your dad started down this organic. Trill, you want to talk about the farm that you grew up on, how you guys started farming organically. Yeah, so my family has been farmers, I guess, as long as we know in history. So we've been in farming all the way back forever.

2:03My granddad bought the farm we're on currently in the 50s. But initially, I was a super sickly kid. My parents pretty much ate standard American diet back a long time ago, 60 plus years ago. When I was born, I was super sickly. The doctors, we went from specialists to specialists. My earliest memories are kind of that. I wonder if I could get my next breath. My parents finally ended up finding a naturopath that gave them some hope that I might live. But it was a radical diet change. He promoted an extreme diet change, no more refined foods of any sort. But here we are. We're growing grains and stuff. But yet, we're buying white flour from the market because our flour, our agrain, all

3:05got shipped to the elevator, right? And then you go buy the bleach stuff at the supermarket. So my parents made a radical change. They basically went out and they threw it all away. Everything, all the white flour, white sugar, you know, crisco, all the stuff that this naturopath said, don't use anymore. They bought a little magic mill thingy. We started grinding our own flour out of our own wheat. Dad even, before we even started organic farming, this would have been back in the 60s. He set aside, I think, was about 12 acres of grain ground that was for the family. So this was family, family wheat, and he didn't put any chemicals on that. So he kind of knew it of his heart of hearts, even though he really didn't understand. He knew in his heart of hearts that putting those chemicals on and stuff was not a great great idea. And I recovered and I got well. And as a side effect, my granddad, who had had to retire when he was in his 50s because

4:09he has heart trouble, he got well as well. And he went back to farming again. And he actually farmed in. He was actually, he died with his boots on in a farming accident in his 70s. And so he completely recovered. I recovered. And so my parents were absolute believers. And as they moved forward just a little bit further, my dad finally began to connect. One day he was out, he was planting. And back in those days, the grain drills, they were just open. It was before the air drill days. And so he was out there and he'd put this pink wheat in there that he'd bought at the elevator like everybody else does. And he was spreading out this pink wheat and the dust was coming off of it. It dawned on him. I wonder what's on this. They make it pink because it's poison and we shouldn't be eating it. But I wonder what's actually on it. So he calls up the elevator and they tell them they didn't know, but they would see if

5:11they could get the MSDS sheets on what they're putting on in the treater, treating, treat material. He finally gets it back and this is after he's done planting for that year. It turns out that it's almost pure mercury that was being put on. We already knew that mercury was a heavy metal that was giving people serious problems. And we'd known that since right after World War II. So he's like mercury and what do we use it for? And so they go back and they say, oh, well, it's for smut, which is a disease in grasses, wheat is susceptible to it. But not in this area. We have never had smut. We never had smut when we treated wheat. We've never had smut after. It were on the dry side of the mountain. We don't really have smut here. That's a disease. Not that we don't have our share of things that we have to deal with, but smuts not one

6:12of them. What area of the country are you in? We're in Eastern Oregon. Well, North Central, but east of the Cascades. The word about 9 to 12 from our farm. It's about 9 to 12 inches of precipitation per year from the upper, you know, from the higher elevation to the lower elevation ground. So we don't, you know, so he's like, well, they're selling me a poison to put on the grain for something that we don't even have. And why would, you know, why would I be doing this? That was the last time he ever used a poison. Well, he actually did fertilize the following spring with conventional fertilizer, but that was the last time conventional fertilizer was ever or any kind of chemical was ever put on our original farm, which was about, it was about an 1800 acre farm.

7:15About 800 tillible on that farm. So you know, that was, you know, in Eastern Oregon standards, it was a relatively small farm, but, you know, it was definitely a commercial farm. We were making a living from it. This was not a situation of a hobby farm. He was, and so we had to learn relatively fast in the school of hard knocks. Because that was a little before the all bright material and stuff like that was readily available. Dad didn't find that for another five or six years after he switched to organic. He, you know, and then once he found that, some of those materials, it became a lot more, a lot easier to do organic agriculture because he began to realize that it wasn't about substituting one thing for another. It was about actually building soil microbiomes and these kinds of things that, you know,

8:19all bright and some of those, I think that was one of the main ones he did very early on. And then later he would attend, and my brother did two to ten like Arden Anderson conventions. He used to have those and he would talk about this same kind of stuff. And so once that happened, then the organic agriculture became a lot easier because we began to know the why. But before that, we were out there on our own very early. On the marketing side, Dad ended up, he was friends with Bob Moore, who was the founder of what's now known as Bob's Red Mill. And so they were friends. And when Bob was just getting started about at the same time in the mid-70s. And so Dad and Bob got together and Dad even helped Bob find his very first mill, mill stones because he was doing stone ground flour at that time. And it was like, so they kind of made this deal.

9:24Dad was going to be the farmer and Bob was going to be the miller and Bob knew Fred Meyer, who was the founder of a big chain of grocery stores out here out on the west coast, which is now owned by Kroger's. But they still use the name Freddy's, I think, for that chain of grocery stores. And so we happily went on, Dad, that was kind of the market for ten years or so, maybe a little longer. And then Fred Meyer, he retires and his company gets sold to angel investors basically, you know, some kind of a financial institute. And they, it didn't not immediately, but eventually they say, what are we using this, why are we selling this expensive organic stuff in our supermarket? You know, Fred, he believed in it. So he was fine selling it. Of course, these investors is just about the money. So they kicked Bob, told Bob that, hey, we don't want this expensive organic flour in our,

10:31in Fred Meyer's anymore. Well, he would, Bob, that was his primary market. He only really had one market. So Bob, he simply pivoted. So he instead, he wasn't quite as strong a believer in it. He thought it was just the marketing. So he just went to the elevator and got the cheapest grain that he could possibly get, ground it, and put it in his bags. He took the word organic off of it and replaced it with natural. But in those years, a lot of consumers didn't know the difference. And so Bob became, you know, you know, and he grew and it's become a well-known brand now. But it was definitely not known for economics, you know, while he was really growing it up. It was just whole grain flour and stuff like that. So we were some, we, dad was not about to pivot. He wasn't going back to conventional farming, not ever. He was 100% all in.

11:32And so we were left without a market. So at that point, I was young and stupid. I thought that, you know, I could find, should be easy. I should be able to find the markets. And so I went, got some grain custom, custom cleaned and custom ground. I didn't have anything at that point. We had no grain cleaners. We had no mill. We had nothing. I mean, we're just a farm. And so I had to find a grain cleaner. I found a miller. We had it custom done. I started going around food co-ops and health food stores and that kind of thing. And hey, you want to buy some grain or some flour? And I got some yeses. But it was a little different. How are you going to get it here? I need, you know, the farm model was, hey, you know, you take truckloads in and even when we were selling to Bob, we had to build grain bins and we did our own storage. But that was the only vertical integration we had to do.

12:34Otherwise, he just showed up with his semi truck. We loaded up the grain and sent it over to him and he cleaned it and milled it, right? So, you know, I, you know, oh, we're selling a truckload. No, I want four or five bags. And I'd like them every week or every 10 days or whatever. And I count, good God. So instead of saying no, I just loaded them up in the pick up and I started running these little rounds in, you know, here in Oregon, Washington. And I started dropping off our grain and flour and pretty soon they started asking for other things. And even more importantly, we ended up with some started out with some friends or friends of friends of family that kept asking me, hey, you're coming over here. But I was doing some Eastern Washington deliveries like in places like Ellensburg and they would ask me, hey, can you pick up some stuff in Portland while you're there?

13:38You know, some nuts or seeds or something and bring it over to me next time you come. And so finally, after I did that for a few months, it dawned on my thick head that there was a food desert in parts of the country as far as healthy food goes. You get Doritos everywhere, but you know, for real food, there was a problem. And so that's when I decided, hey, if I'm going to be running these routes anyway, I may as well make it pay better. And so I put together our first little Azure catalog when we started selling other products besides the things off our farm. And you know, it was nuts and seeds and grains and some beans and lentils and things like that. And that was in Christmas. I did it basically between Christmas and New Year's, 1987 and into January of 1988.

14:40And that's when we first started using the name Azure Standard. Before that, we were known as Stelser and Sons Husbandry. Family owned Azure Standard is for families ready for a great year. We're an online store where our organic nutrient dense foods and household essentials are chosen with care for people who value living healthier, more abundant lives. Shipping direct to you in all 50 US states, we make quality products affordable. Shop this year aligned with what matters at home. Join for free today at azurestandard.com. Word the name come from. Well, the name was more visionary than it was practical at that time. We were a pretty small, pretty small player at that point in time. But I began to see the huge amount, including, you know, Bob doing the pivot quickly and a lot of people not knowing the difference.

15:40And I felt like there should be a standard set in marketing of organic food and there's, there needs to be a standard. Not that I knew that we could become that standard, but the vision has, you know, slowly trans. It has slowly happened. But we wanted to create, create that standard. I'm a little bit of a history buff. So blue in like carol tree and stuff like that, historically, it stood for law, justice, doing things right. That's why American flag has a blue field that the stars are in, right? It's supposed to be, you know, the states connected in justice and equity. And so I, so instead of saying, ah, blue, blue standard blue shoe Azure is a shade of blue. It's the shade of, you know, it's the new and a sky from a mountain top, basically shade of blue. And so we named the company Azure standard, our fledgling company that we really.

16:44So it was extremely visionary. Now that I look back at it, I don't know how even had the guts to have that vision. But that was a vision that I had. How old were you when this started and like, where did you get the, the training and, you know, you said you put together your own catalog like, who were you doing all of this yourself then? Yeah, I am without training and without education. There's another story and I actually wrote some of that. I just, I just recently wrote a book called Seeds of Hope that. Tells a lot of that story. But due to some other drama with the farm and the family, I ended up having to drop out of high school. On my beginning of my sophomore year. So I have no, I don't have a high school education. But I do know how to read.

17:45And the thing is you can learn just about anything you need to learn if you're desperate enough for sure. From reading. There are amazing books and that's one of the cool things about acres is preserving a lot of these really important books that we can learn from. But we can learn a ton of things from reading. So I became an avid reader not only on the agriculture side to learn. I mean, reading things like Arden Anderson and Albright, Neil Kinsey and some of these guys, you know, back in the day. But also reading, you know, business and processing and things like that. You know, I didn't know how to do Dittley Squad. My very first catalog wasn't very professional. I did it on basically on a word processing typewriter. This was not, you know, and I drew the, the drew the graphics. Actually, I had a friend draw the logo and the graphics because I'm the world's worst artist.

18:47And we put it on the front cover with a copy machine. Not so rudimentary it was. I didn't have, I didn't have any training. I didn't even, I had never turned a computer on. Our first almost probably four years of business. We did it all with paper. 100% you know, it was probably four or five years in before we even got our first computer. Which seems pretty crazy nowadays. This is, you know, computers were pretty expensive back then. So what was the first thing that you ended up buying trucks? You know, I didn't have any money. So things were took a long time for me at the very beginning. My entire life savings when I launched Azure was $5,000. And I know it was worth a lot more. In 1987 that it is today. Today that sounds like pocket change. But then, you know, that wasn't too bad.

19:47But no, I used my personal vehicle for quite a while. I ended up buying my uncle bought me an extremely well used Chevy Love pickup with a custom box on it that said pedal pusher. And I delivered in that for quite a few years. I ended up in a one ton van that we did that I delivered in that my parents had. Dad let me use their van. Once I got too big, you know, too much for the Chevy Love pickup. That too big a load I would use his van. And then yeah, it was a couple years before I got our first. We got a little very well used Marseilles box truck. Like a two ton started delivering in that. Didn't have any refrigeration or anything. I had to I had to create special boxes on it to put any refrigerator, frozen items in.

20:47It was fun. But no, no, no very big investments. The first few years it just wasn't wasn't any money. But once one thing started rolling, that was our first truck. And then my uncle actually was an owner operator. Oh, it did own his own truck and he was an owner operator and ran for a company out of Yakima, mostly delivered fruit to the produce markets down in California. And so when we grew a little bit bigger in the mid 90s, I talked my uncle into doing a lot of our deliveries. Once in his semi, once we got too big for the truck. So especially during, you know, the late 90s when we started getting into what we was known as the Y2K storage era, we ended up kind of growing up on that. Before that, we were pretty local.

21:49We were pretty small. But for some reason, you know, we offered high quality organic grain and flour and beans and rice and all those things. And the word got out when people started storing in 1998, 1999 that Azure was a great place to get those kinds of commodities. And I never really, I mean, that wasn't, we never pushed that. And we never paid for it. Just people that, you know, talk show, talk radio was the big thing back then in the 90s. They started talking about Azure, hey, if you don't want to spend a bunch of money on pre-prepared foods, you can just buy the bulk stuff and put in jars or buckets. And here's a good place to just buy the grain. And so we went from these little box trucks to semi trucks in just a matter of a few months. It was a really, really big deal right during that time frame.

22:51What was the process in finding the products? Would you go out and you'd meet the individual farmer and then how are you developing the standard that you had? Well, back then, I would go meet the domestic ones. The once, you know, when we went and got grain, or we went and got stuff from other parts of the world. I was not doing that yet at that point. We do now, but back then that was too big of an expense. I could not afford to travel around the world. But I had been involved in the founding of Oregon Telf back in the 70s. They were just getting going. Now they're known as a certification agency, but at that time, they were more of a organic support agency. So it was a support group of a lot of farmers got together and they would talk about their challenges, the books they were reading, the things that were helping, things like that.

23:54So I got involved in that very early. So I knew a lot of the people who were, a lot of the growers that were in those, you know, those meet, that would come to those meetings. So I, you know, I would get their phone numbers and then we would talk and, oh, hey, Rod, you got lentils. And you know, he was, I met him at one of those meetings. Like, yeah, you got, can we get some of those cleaned up and I sell your lentils? That was kind of the way it went, one growing another we went. No, that was the early days of Lundberg. And you know, my, my dad actually traveled down to Lundberg and he spent like a whole day with the four Lundberg brothers and we created a relationship with Lundberg for the rice. That was when they were just getting into the organic world.

24:54And you know, those are the kind of relationships that we started with, but I didn't, you know, my almond grower, he, you know, I went down and, you know, we talked to him. He was a great guy. I mean, he's no longer living, but, you know, at that time, those are, those were really cool relationships. And, you know, and so that's how it moved, it moved out. But when I was, you know, but when I was getting the cash shoes, I was just getting those from a, from an import broker. I had no way of buying a container load of cash shoes. We were tiny. I mean, we do now, but back then that was a, that would have been impossible. I mean, it's hundreds of thousands of dollars for a container load of cash shoes. That would have never worked for me. So a lot of it back at that time, I was just trusting, you know, hey, it is healthier product than the alternative. These at least were getting bulk direct from farm commodities.

25:59But yeah, I was not vetting all that back then. Were you delivering to your delivering mainly to grocery stores? No, never really got into the grocery store market. Truthfully, still aren't to this day. Grocery stores is not where we found a strong spot. Health food stores and food co-ops were pretty big back then. But the direct to consumer model began to grow much faster. Probably, and it really, in the very early days, up until the Y2K thing, we were probably delivering fast majority of what we're doing was to grocery stores and food co-ops. But during the Y2K growth spurred, we went almost all of those new customers were individuals. Really? The other place we sold a lot to back then, there was these things called magic mill stores. They were like sold magic mill grinders and they sold a lot of, and they would sell a lot of grain.

27:03That was one, that was another one of our really big, you know, store markets. So once, so you captured, you kind of got your fortune in some ways that the Y2K thing sent you a bunch of customers. But then how did you make sure that you retained those customers? Well, that was an interesting thing because come January of 2000, our phones were kind of dead. There was nothing going on. Everyone was stocked up. And that's when, and I, I foresaw it just a little bit. And so that's when we started really concentrating on the perishables. So we started doing a lot of cheese and meat. We added in some produce items and things like that. In February of 2000 was the first time I actually did what would be considered today true marketing. So I went out and I took, because now I have fairly fresh within the last two years.

28:05I have like 35,000 names and addresses of people who purchase from me, mostly probably to stock up. But I knew they at least cared enough they were getting organic grain instead of getting the cheapest stuff they could get. So I sent out my first direct mail piece. So and stressed. And so I included in that our schedule of deliveries. Oh, we're going to deliver. And that was then we put it on kind of a regular schedule. I'm going to do it every fourth Tuesday or whatever. So every other Tuesday or whatever. And then and we put what towns would be what days and stuff in this schedule. And then but then we sent the rest of it was all promotions and all about all the perishable items. I knew they couldn't have stocked up on those things because they wouldn't have kept. So we absolutely completely stressed the perishables. The best cheese, the best butter, the best produce.

29:09We did few frozen few frozen items and stressed all of those things. And it took about six months and we dollar wise not volume wise by any means. But dollar wise we were back up to where we were in 99. But then adding adding all of those then adds a layer of complexity because then how you have to you know you can't just get a freezers you got to have storage for them. How did you wrestle with that? That's that was a big deal. My dad actually was my dad in his natural inclination in many ways was more of a builder than a farmer. By that time my brother pretty much taken over most of the farming. And my brother, he's a farmer from head to toe. But dad loved building. That was his thing. And so he actually built most of the infrastructure, the warehouses, the freezers, the coolers,

30:15all of that stuff. So while I was out selling stuff and packaging food and stuff, he was building the infrastructure. And so you know that was part of the family dynamics that we that we had. And he had a couple guys that would help him from time to time. But he was a very skilled and prolific builder. And any love doing that way more than driving a tractor or even you know even doing the organic agronomy you love building. So he built a lot of that stuff. And then you know back in the early days, we just built some insulated boxes that you know that we put in the back of the truck for our frozen stuff. We just had a box that we built a wooden one with insulation and all the panels. And then we put and then we put the frozen stuff in there. And then I always put it under a blanket. And if I was going very far we got a little dry ice to put with it.

31:17But most of the time if you put it in the insulated box and it was well insulated on the bottom and then I just go to like second hand stores or yard sales and stuff like that and buy these heavy quilts like you know like bed quilts. And then I would tuck that around the around the frozen goods over the top. So there was no air space above it even though it was an insulated box. And we could we could we could keep frozen for 48 to 52 hours easily all the way to ice cream if we really needed to. So it was it worked pretty well. And so those would sit on the back of the truck and then I would do the same thing with the refrigerated items. They would all be separated out. Anything you know and then we'd put them in that. Sometimes I did not use the actual insulated box for that. We'd palatize it and then I would use those quilts over the top.

32:20So then as we're delivering and we're pulling down the quilt keeps going down right and keeps holding the cold in on the items that are still left. And so instead of I don't know it was really on the cheap. I mean you could usually buy those quilts for like two bucks at a yard sale or something you know. Right. And so that was that was my great you know insulated dual temp. Thing but it worked. It's just like how did the I just I'm imagining like as you guys are growing in people would maybe approach you to do something different. But like how did you continue on the drop off idea? Did it just always just make the most sense? I mean I think it gives it gets rid of all the middle people between the farmer and the consumer.

33:20Hey all here is a quick note from one of our sponsors American farmland trust who leads the conservation agriculture movement. Focusing on the land the practices use on that land and the farmers and ranchers who steward the land. Working from kitchen tables to the halls of Congress. AFT's mission is to keep farms and ranches thriving. Since it's founding in 1980 as a membership based organization, AFT has helped permanently protect over 8 million acres of agricultural land. Advanced regenerative farming practices on millions of acres and supported thousands of farm families. Find technical resources, network opportunities and more at farmland.org. Well early on I mean not super early but after I was a little bit into it and I began to understand the industry a little bit. When I was first into it I didn't have a clue. I didn't know how the world worked when it came to food supply chain I guess is the right term for that but I didn't know anything

34:20about that. Once I began to understand it a little bit better then I went out and I thought that we could you know that I could get our products into the existing distributions supply chain model and that would be the right way to do it. So I hit up all the distributors and the larger stores and chains. Nobody would even look at it. It was like oh are you kidding there is no way. Or well you know we'll take it you got to sell it though and we'll and if you pay us X amount for slotting fees and every store that buys it needs a free fill. Plus they're probably going to get some slotting fees too and etc. etc. then you know then we'll pick you know we'll pick up these three or four things. It's like I didn't have the money to do that there was no way and heck that I could do that and today it's still the same. I mean to get a

35:24product into national distribution they say it's about a half a million per skew minimum maybe more up front before you get your first time back. That's you know just because you're you know you're paying all that you pay your distributor you pay your broker you pay your you know the slotting fees you pay the retailers for self-shelf space and all the stuff and by the time by the time you get it launched and then then you have to do a national sales and marketing campaign to get it off the shelf or they'll after you pay all that they'll just discontinue it anyway. So it I realized that I could not do that model and so that's why I doubled down you know that was originally given to me by you know an idea when I was delivering to the in the early days one of the gals she I more and more of her friends and family started having me pick things up for him and she says oh honey don't worry about it just drop everybody's stuff at my house. Still I'll pick it

36:28up here and that was kind of my first drop point was given to me by one of our customers because I says I don't know if I can do that if I can get to everybody's house in time I mean because I got to get back home and farm I was still farming at that time and on a you know pretty full time basis and and so that was how the drop point concept got started so then when I would get other areas then we'd do the same thing oh can we all can we just drop it off it that person's house or you know this little you know farm store or whatever and that's where that concept got started so when I realized that there was no way that I was going to you know make that happen that's when I doubled down on the drop point concept and it you know and then you know community started happening around it people really enjoyed it get together with your neighbors pick up food every once in a

37:32while it became a real thing and so yeah it wasn't it wasn't necessarily by design it was for practical purposes because I didn't have distribution I was having to do my own distribution if we'd had distribution I'd have never done it because we'd gone to traditional retail supply chain model but I had it is it's it's unique that you're doing the drop off because when I would think of drop off I would think of you'd want to go to like a big city but you know we had an event down and you know pretty remote Texas this spring and there's a drop off at that person's farm what I mean do you guys take pride in the fact that you're getting these these drop off points out in rural communities I mean and that's kind of where Azure started from the very beginning these food deserts so to speak where there's not any good food in the smaller communities I mean in the big communities I mean

38:36they maybe they have a whole foods or something not that that's any good anymore but back in the day it wasn't you know they started with the right idea but there was a whole food store or a sprouts and maybe a good farmer's market in town and all these things these rural and semi-real communities don't have any of that so I think it just naturally occurred that our drops begin to grow more in those real communities so for the in fact it's only been really the last five or six years that we've seen any growth in urban areas before that our urban area drops were almost non-existent and I think a lot of that was people didn't trust each other in the major cities in the semi-real areas I mean everyone's fine with everyone coming over to their house or their church or whatever and picking up product in the major metros everyone's scared of their neighbor and they don't want to you know they don't want to open oh what if what if some creep comes

39:38to my house or whatever and so it it was a lot harder model to get started in the super urban areas and I think it was a lot of that was it really didn't take off in the urban areas until we started really concentrating on the church drops so the church drops is mostly where it is where it you know where it's gone in the in the bigger cities yeah it's such a I mean I can't imagine the hurdles that you dealt with because like you described like there is a there's a normal process for all these things to happen there's the the normal logistical ways that food gets moved across the country and and there's probably a reason for it it's a lot it's easier and it's more simple um how have you guys you know juggled the fact that you are just so outside the box but you're you're a logistical company and uh a distributor yourself like I know you come from

40:44being a farmer and you want to get food into people's healthy you want healthy food in people's hands but like how much of a of a struggle has it been to like learn the logistical distribution trucks all that side of the business well every everything has been you know a learning curve for me um but some of the logistics I kind of cut my teeth on because even though I was doing it myself in a way I was creating the logistics I was creating the routes I was creating the drops we were doing all of that you know so it didn't happen like overnight this was a it was a slow process and then I got my uncle involved and he was very skilled at in the truck drive in the trucking world you know he had his own little trucking company he was just an owner operator but he was you know he did his own stuff he wasn't he wasn't uh subcontracted to a one particular um carrier so he was a

41:52truly independent and so as we begin to grow Uncle Norm he he was he was on board with it almost from the beginning still is he's still he's retired now but he's a great guy I mean I think he's it is mid late eighties now but he a great guy and he would okay let me help and so he would you know he would do all the you know when we got into semi trucks the paperwork and everything is completely different you have all the you know the if done the road tax and everything else that's involved with that stuff and so in the early days he handled all of that stuff for Azure all the way so it was his you know his logistics company and we just paid him as the logistical company we didn't actually start our own logistic company until 2020 so that's when our own before that it was Uncle Norm and a few other owner operator small

42:56company contractors that did all of our delivery for us all all over so it's pretty amazing yeah what so I didn't have to learn it quite as good and then by 2020 we had a big enough team I didn't have to completely learn it either right outsourced that to other team members right yeah made made other people learn uh some of that but today our logistics is you know is it complicated yeah it's probably on the love you know on the level with an airline or something it's not not exactly simple but it's a growing process it didn't you know it's not like the you know the 20-year-old version of me would suddenly have to you know know everything that I know today that that didn't have to happen that was you know that was a longer learning process so you want to talk about the scale that azure's at right now you guys are all

43:57and are you in all 50 states 48 states um because it's it's fair you talk about the scale yeah so azure now does uh we do drop point delivery in all in all 50 states we've got drops in multiple drops in every state um we run our own trucks into every state except for alaskan Hawaii alaskan Hawaii are uh we just delivered to the loading the dogs um in it for alaskan in Seattle to coma area there's a bunch of shippers that take product to different parts of Alaska because everything shipped in there anyway and technically actually as far as per capita alaskas are strongest state we uh we just kind of celebrated deal because we just crossed the threshold we now sell 2% of the food that goes to alaskan comes from azure so we thought that

45:01was a big milestone you know that is that's amazing it was which crazily enough is almost the same percentage that they grow in alaskia um they grow about two per or they eat about two percent of the food that they eat in alaskas grown in alaskas so that's uh not that our food is it isn't but anyway so that was kind of a big milestone so alaskan is one of our big has been for a long time one of our big spots uh Hawaii not not anywhere close but um but we do ship to Hawaii out of the oakland san francisco there's a couple of shippers that take uh LTL or pallet load shipments so we ship them to the drops through that third party shipper um to Hawaii and actually to guam and uh virgin islands in a few other places as well so we have drops in other us territories around the world

46:02that's incredible so when when you look at agriculture today what is the biggest problem that we face do you think it's production or distribution supply chain issues for the organic or regenerative farmer or regenerative regenerative yeah let's say regenerative and organic farmers because the biggest thing i get pushed back on is the markets and the distribution so what do you see you have plenty of production or you need more production or do you think it's a distribution issue when fertilizer prices double and diesel fuel spikes overnight most farmers are reminded how little control they actually have over the systems they depend on for more than 50 years acres USA have been bringing together farmers agronomists researchers and innovators building systems designed to withstand exactly these challenges at our ecoad conference we connect the dots between soil health livestock agronomy profitability and human health if you're looking to build a more resilient farm reduce dependence on an outside inputs and create systems that

47:03actually work long term join us at the 51st Annual Ecoad conference this December 1st through the 4th in Iowa City Iowa you now azure is definitely looking for more production nationally not through azure but nationally we're only growing we're growing less than 30 percent of the organic food that is consumed in the us us farmers are growing less than 30 percent and it would never be a hundred percent because we just don't have the climate for it we're not going to be growing the coconuts and the cocoa and the chocolate and stuff like that in the us maybe we can do a little bit in Hawaii but it's just not practical that it would ever get to a hundred percent but there is a lot of organic products that are being imported I mean we have a huge market people love organic meat chicken for instance and

48:06things like that there is not even close to enough grain being produced organically in the us we are importing Buku loads of feed grade grain from other parts of the world to be fed to those chickens even if the chickens are raised in the us because there just isn't enough there aren't enough farmers in the us growing that grain I mean some of it does come from Canada which you know isn't that terrible but a lot of it's from other parts of the world completely there's a lot of it coming from places like Argentina and Australia as well it's you know because there's more organic production and some of those other parts of the world and they're exporting that here to the us so is there room for more organic growers absolutely even organic beef I just read it was about half of the us labeled organic beef is coming from

49:12outside the country primarily from Australia New Zealand grass fed beef mostly coming from New Zealand that if you see it in a major supermarket it's probably not from the us and I think the thing that I see is the biggest challenge right now is processing it's that mid-size processing plant that the grower I mean we convert it and readily integrate and I've been the king of doing that done that put in my own flower mill you know we we go all the way to bake sourdough bread frozen in a bag ready to you know sliced and ready to put on your table wheat that we raise on our farm goes all the way through the supply chain to the frozen bread ready to deliver it Azure under our hearstone label great wonderful and there's a you know a huge number of people that that need that

50:15but that is a lot of supply chain that's a lot of vertical integrations to get there that's not an easy thing and especially when you get into meat and things like that the hoops that you have to jump through become a lot greater not that they're not plenty of them to grind flour and stuff like that you know once you get into middle market then you're having to do all the food safety things and all of that that the big guys have to do and I think the big guys have actually pressured the government to make those things more stringent to keep the middle market producers out of the marketplace so they're not competing with them and but again maybe I'm just imagining things but it kind of feels that way seems logical because they're you know the rules are the same there's small there's exceptions for really small facilities like from fism of food safety modernization act and

51:20things like that but there's not from middle market so you're you're having to jump through all those hoops so the level of entry or the difficulty to get into it is astronomically larger so I feel like we should actually be working on more middle market where growers you know either growers combine together or some of on the distribution side we do that maybe some of both and we put in our own processing plants our own cleaning plants our own meat processing facilities our own you know bean and grain processing facilities our own vegetable packing our freezer plants you know how hard is it to grow organic vegetables I mean it's one of the easiest things we can do yet almost 80% of our organic frozen vegetables are being imported from places like turkey

52:21and you know in Argentina and you know chilly fruits and vegetables I mean frozen corn and beans being imported from turkey I mean come on guys but the the entry point to get a full blown iQF plant that can get a quality frozen you know peas and beans it's not an easy entry point and you know and there's one or two out there I mean I guess snowpack is a good example of that there and I think they're close to your neck of the woods someplace maybe Minnesota side the border but close and you know and they have a middle market and they're working with some growers around their area but we need we need to dozen more of you know of that size to be able to keep up with the demand I mean how do how do we get them what would be your solution for it because I think normally it would come in the line of the government subsidizing these some way but then um then we're going down

53:29the road of government subsidies again so what would be your solution I have never seen a government subsidy that ever was good enough that there weren't enough strings attached that it was I know but that seems like anytime I ask people in agriculture like how would you solve this like all the government should come up with them program it's like well I think that's a work that's a real too quick of a go to we need um so there's there's a couple things I think right now there is enough interest in the marketplace in organic and regenerative agriculture that there is no reason that we can't attract investment money from the outside in real business in a real business sense there are you know even investment groups that would love to even if they're not making much money out of it because they're saying hey this is um but they can tell their investors part of our portfolio when

54:34you're investing with us and their mutual fund or whatever it is um we support organic agriculture we're invested you know 5% in whatever it's even if it's not making money for a few years it's everything else is evening it out it's not a big hit on those guys and just being able to say that is a big plus for them right now so I think attracting that but in order to attract that we have to have a business plan we have to know what we're you know what we're doing I think growers you know or hey you got you know other you know other family members on the farm that are interested more on that side of the that side of the fence I mean that's happened in our family we have some of our family members are on the food processing side and some on the agriculture side in leadership um you know put together the plant hey here we we are proposing this slaughter facility I know

55:42these 12 organic or regenerative growers and we're going to market all all of their chicken or beef or whatever it is we know these people the relationships have been made and the markets are there um here you know and I'm well I'm happy to help with that part because we're here you know we're always looking for some but we're not the only ones there's definitely other other companies a lot of other companies that want to you know get scale their organic production and they would rather do it from the US than going overseas for those for those commodities um so is this something that you guys have looked into because it would make sense that these investment groups or whatever would be interested in working with some a group like you guys that would have have the market already you know maybe we can become part of that middleman the other middleman

56:48facility for that but it is not what we have concentrated on so far yeah and I think what's happened in the past where maybe a company like yours might be what investors need to invest in something like that then these slaughterplaces become exclusive in the sense that if you don't sell through this place then you can't slaughter here and that's what I don't want to have happened right and that's what I would understand it from your perspective you're going to go invest in those facilities you want your product to be sold you want that product to be sold through you well I want to I want to have at least first right of refusal right I mean if I'm an invest my money into a processing facility even if we're going to make some other brand that's okay if we have the bandwidth to do that right when we grow Azure enough that we need all the bandwidth I want to be first on the list right I mean there's there there would it would be silly for me to invest my money

57:50and then have to go invest it again because we're supporting a competitor that would just you know that would become silly so yes that would you know if I'm investing my money or putting my credit on the line so to speak that's going to have to be the way it is yeah otherwise I you know I can't justify it yeah that's completely logical but if a farmer's doing it or a group of far you're up you know you've got your own the world's your oyster yeah for sure it's a let's or whoever else yeah let's let's put this around a little bit so you spent you're in a unique position where you spent decades buying products from all over the world and when you look at a farmer and say that somebody that we want to work with or we want to sell their product what are the things that you are looking at or you see well you know and we usually do go visit farms or we do a lot or we have

58:53a somebody on our team no I don't personally do it anymore completely it's be too many but I've done a lot but the the conversation is a little bit like this so you know we go you know we might go look at the farm and ask for a tour and sometimes we may not but the conversation's going to go hey you know just want to know what it is about organics that really attracts you what makes you want to be an organic or regenerative grass fed you know because we do have different phases you know not everyone can make it all the way at once and there's you know especially in the meat world there's a lot of room for you know halfway there stuff um and you know what a traction to that what makes you want to want to do that you know if I hear something like oh you know I just found out that organic grain you know right now for my wheat I'm getting 550

59:56bushels at the elevator and I just found out that xyz the neighbor up the road is doing organic he's getting $22 a bushels for his his wheat I'm really interested in that 22 bucks and I'm really trying to find the things that I can use that's organic approved to replace the the sprays and stuff hey by the way do you have a good a good wheat killer that you could recommend that's probably not a farm remnant work with truthfully because he doesn't understand nutrient dense food he might be able to go by the organic rules but he's not really a truly bought in regenerative organic farmer if I hear something like oh yeah you know um we are you know I'm really I'm super excited about making my soil better we're looking at the microbiome you know I've got these three fields and I'm using excuse me micro rise on and these ones I'm not

1:00:59and this over here we're using compost on and this piece um you know it it's so interesting you know we rotated these two these three crops and I noticed a 10% increase in quality our protein went up by 5% on my grain after I because I followed it with after lentils and and that's the story I'm hearing that's my farmer that's my man because they're bought into the concept they understand the microbiome of the soil what we what the plants really care about and actually how to produce food that's going to give life to the customers because that's our mission you know inspire healthy and abundant living that's the core mission of azure and you know and it's how it started for me because it was it saved my life and and this is my you know my passion

1:02:00and so I want a farmer who is bought into that concept because the health of our bodies and the health of our soil is so aligned it's you know and you even look at it the similarities between the the most healthy microbes in the soil and the health giving microbes in our body they're almost the same microbes crazily enough they're very very similar so that's you know those are the kind of things that make me excited to work with somebody when I when they're really understand and you know we talk about the principles that you know men like Albright throughout there and now you know meal Kinsey you know John Kimps out on the forefront of that some now you know these are the kinds of you know they those are the guys that you know blaze the way and taught it you know taught us how to

1:03:05work with these you know with healthy soil and you know and there's plenty of charlatans I was just I was just on the state I got invited to speak at Oregon State University they have you know in their egg program they have one day for dedicated organics in their three year program you know so I was one of their inviting speakers yeah it was real nice so I got to speak to the agricultural class as one of their presenters the guy so I got there a little bit early and here I am listening to the guy in front of me he's got a PhD behind his name he's been working in the extension service through the university he's a professor basically and he's laying out this whole system where you can basically gain the system so you go out now you put on all these extra chemicals and more pot ash in this and that and it can build up in your soil make sure you know you sprayed all the

1:04:07noxious weeds out really heavy and then you do this transition thing and so right before you go you know transition you put on all this stuff and then you know and then plant something like alfalfa going down falfa because it's pretty easy so grow alfalfa for three years while you're transition you don't have to put anything that's not organic approved on while you're growing alfalfa really you can just put on some gypsum and stuff instead of hydrolyzed lime and you know if you it should work and then when you come out at the end of three years you plow down your alfalfa and then you can plant grain in there and do a maybe two years of grain and the alfalfa will have you know put enough by nitrogen on that you probably should get it halfway decent crop and then you might go into like a legume like a lentil or a bean after a year or two of grain do that for one year try to grow grain one more year and then go back to conventional because by that time the weeds will have taken everything over and you're you know and so then you just go

1:05:12back to conventional farming and you rotate through that so you have like a 10-year rotation where your 10-year is conventional eight or 10 years organic or between transition and your organic production and it's like what is this because he does not understand soil at all this is a professor these are the guys that are teaching the next generation of you know egg students if you if you're getting an egg degree this is the guys that are teaching you and he's going to teach you he is trying to substitute with organic but proved materials in a conventional thought process he hasn't you know he doesn't understand the microbiome of the soil yet and he's basically trying to teach these guys how to gain the system and I'm not saying that what they raise wouldn't be better than just standard conventional because he's not telling them to cheat or anything like that it's just a way to you know to game it without

1:06:15technically cheating on the rules of organic farming but this is not the farmer that we want to work with at Azure that's not what they teach and so when I'm you know so I go up after that and I'm basically saying well I've been doing this since 1973 and our soil is getting better not worse and by the way we our pot pot pot ash and potassium levels are just fine you know there's soft rock phosphate and stuff that you can use and he the professor told him there's no way you can break down soft rock phosphate or any phosphate without an acid that's not organic approved I told hey you can break soft rock phosphate down purely with apple cider vinegar it works just fine why would you you know and it can even be organic apple cider vinegar you know it's not you don't have to do this kind of stuff and besides the soil begins to release more

1:07:18phosphates in fact we've hardly ever had to put phosphates on in you know 50 years of organic farming because more of it gets released by the bacterial count in the soil so I mean this is you know this thing said he's so worried about like the phosphate deleting and not being able to use this acid that's one of the reasons he gave for not never being able to not rotate back into conventional it's like no you're this is not um this is not as difficult is what you're trying to make it out to be it's a philosophy we're farming the soil we're farming the microbes we're looking at the tilt of the soil we're not looking you know so many conventional growers they take such pride that their their field doesn't have a single weed in it that has to go out the window we are going to have some weeds we are going to have

1:08:18you know as regenerative farmers the weeds tell us a story it tells us things about our soil weeds are not going to be completely zero it's not like using you know the the harsh chemicals that are being used today um you know we we do have some weeds we do have things we have to deal with so it's uh it's not something that is just a magic bullet we don't have a magic you know a roundup substitute it doesn't exist we are creating soil that doesn't need to grow that many weeds that we that the weeds are small and the crop is tall and the crop out competes the weeds it's not that the weeds aren't there they're always there for when the soil gets out of balance they're there you know nature does not like a vacuum it wants to grow something and when when we can't grow a good crop because our soil is insufficient there's weeds that are going to take its place no question

1:09:20about it but hey it's sorry this is all stuff that you guys talk about all the time I don't need to I don't need to go down this path but no it's good that's one of the most unique things have ever heard someone tell me that's uh it's sad but I I believe it that's too bad and it does it does concern you the people that are in those positions that are educating but he would say something like that that's that's wild well he taught a whole class on it it wasn't you know it wasn't just something passing yeah it's laying the whole thing out on the whiteboard how the rotations work and to these ag students and you know it's it's interesting to see the the thought process behind modern ag but you gotta remember that professor was taught by you know the the um the chemical companies yeah oh man well uh David I've really enjoyed the conversation with you I'm looking forward

1:10:27to meeting you in person you want to talk a little bit about what your talk is going to be about at our conference in December well I think that the idea was to give some some marketing outlines so instead of talking like I usually do about organic agriculture and the health benefits and all of that I'm going to talk about them the the connection between the consumer and the farmer remember the farmer is the guardian of the nation's health and as organic and regenerative farmers we take that very very seriously and how do we take that the most seriously we have to take it to market and we have to be economically viable how can we be economically viable and fulfill that mission at the same time and that's what I want to talk about I'll be amazing I'm looking forward to it looking forward to meeting you in person thank you again for joining the podcast thank you again for your support at the conference and on our podcast here

1:11:30and uh anyone wants to check out azure standard make sure to go to azurestandard.com anything else you want to let people know how they could work with you uh in the future yeah absolutely it's it is azurestandard.com if you're interested in reading our story I do have the book this is seedsofhopebook.com and this uh this version is not immediately ready to ship there's a couple more weeks left but it'll be um um you can pre-order it now and we would appreciate all the pre-orders that we can get because that helps us get on the bestseller list so to speak and um and gets us a lot bigger audience in the consumer world so I will be able to tell the organic story to a lot more people if this becomes the bestseller so that will help all of us if we can if we can do that

1:12:32and um and I look forward to meeting all of you guys at the acres conference this December awesome all right thank you very much you have a great day all right thank you all right that wraps up this episode of the podcast thanks for tuning in and being part of a growing community committed to soil health land stewardship and ecological agriculture find us on Spotify apple google play and all other trusted podcast platforms give us a follow give us the acres USA is North America's oldest publisher on production scale organic and regenerative farming for more than 50 years our mission has been to help farmers ranchers and market gardeners grow food profitably regeneratively and with nature in mind a big thank you to our podcast sponsors azure standard and american farmland trust for supporting these conversations and helping us to spread the information and message of ecological farming if you enjoyed this episode be sure to subscribe leave a review and share it with someone who cares about the future of farming we'll

1:13:35see you next time on the acres USA podcast