Q & A with Uncle Matt’s Organic CEO, Matt McLean
A seasoned advocate of the natural way, the citrus grower behind the Uncle Matt’s juice brand foresees 50% growth this year. He tells how his farm made the switch
More and more Americans are clamoring for organic products. Shoppers are ever more convinced that food produced without harmful pesticides, chemical fertilizers, and hormones is better for their health. And according to a study by the Organic Consumers Assn., they are willing to pay a 50% premium for swallowing their principles, so to speak.
In 2005, U.S. organic food sales totaled nearly $14 billion, a 30% jump from the previous year. With overall retail grocery sales growing at a tepid 4% a year for the last decade, it’s no wonder that retailers from Wal-Mart (WMT ) to Kroger (KR ) are jumping at the chance to satisfy Americans’ growing appetite for organics.
Clearly, this is a huge opportunity for American farmers (see BW Online, 5/25/06, ” Going Organic: The Profits and Pitfalls”). According to the U.S. Dept. of Agriculture (USDA), organic farming has been one of the fastest-growing segments of American agriculture in the last 10 years. Certified organic cropland for many crops, such as wheat, lettuce, and apples, has doubled in the last five years, while organic dairy farming grew even faster. There’s plenty more room to grow — only about 0.4% of all U.S. cropland and 0.1% of all U.S. pasture has been certified organic.
ANCESTRAL METHOD. The fact is that, down at the farm, organic can be a hard sell. For starters, it takes at least three years for most conventional farms to complete the transformation to organic and win USDA certification. Most farmers are afraid of the costs and risks involved in such a move.
One convert is Matt McLean. A fourth-generation citrus grower in Clermont, Fla., the 34-year-old McLean takes pride in the fact that he tends his crop without the aid of synthetic fertilizers and pesticides, just as his ancestors did in the early 20th century. His customers include local natural-foods stores and supermarket chains such as Whole Foods (WFMI ), Wal-Mart, Trader Joe’s, and Kroger. BusinessWeek Online writer Pallavi Gogoi spoke with McLean about the potential and the perils of organic farming. Edited excerpts of their conversation follow:
Everybody’s talking about the growth of organics. As an organic farmer, how has the growth affected you?
Organic has been growing quite rapidly in the last five years. But right now there’s a frenzy, with big retailers like Wal-Mart saying they will double the organic produce they offer. We’ve always grown over 20% every year since 1999. Last year, we saw a pickup in demand and grew 30%, but the last six months we’re on pace for over 50% growth. In fact, we’re limited by our supply — otherwise, it would be even faster.
Have you always been an organic farmer? How did you start?
We are a fourth-generation Florida citrus family. I’ve been in organic farming for the last seven years. It started when I was marketing our juices in the mid-1990s to Europe and the Middle East. I met someone in Germany who wanted organic juice. Given that my granddad had been preaching the benefits of organic farming for a while, I naturally got interested.
What had your grandfather been preaching?
We called my granddad Pappy, though his name was Ben McLean — we have a picture of him on my juice cartons. He used to say that we need to go back to how we used to farm and not use as many pesticides.
He was like everybody. When synthetic farming came in, he got in and saw his crop yield grow, and everybody thought it was good and made more money. But after a while everybody realized that maybe it’s not all good. He said that this was a rich man’s disease, and that we’re our own enemy because our soil had become poisoned and sterile, and that nothing was natural anymore.
Didn’t you think it would be risky to switch to organic farming?
I felt like that the market for organic juice was starting to build. My granddad had the experience, and I started to listen to him and became more passionate about it. I also felt like this was a way the family would really come full circle and Pappy could teach me all he could and I would learn.
Initially, I exported 50% of what we produced. Today, we sell 95% of our produce here. After all, why do I need to ship overseas when there are all these thirsty people right here in the United States?
Your juice brand is called Uncle Matt’s Organic, after you?
Yes, I have 10 nieces and nephews, who range in age from 1 to 11 years. But I got married in March, and if we have children, maybe we can expand (laughs) into some other names.
How big is your farm?
We started on my dad’s five acres, and today we control 1,000 acres. We own half of that and lease the rest. Under our organic certificate, we have to farm it a certain way so we have total control over all 1,000 acres. Two-thirds of our farm is still in transition — since we have to wait three years by law before we can sell the produce from those groves in the organic market. Then we will be the largest organic juice-producing farm in Florida. We are already the largest grower of oranges, grapefruit, and tangerines that goes to Whole Foods and other local supermarkets.
Everybody says that it is a hard transition. What was your experience?
It depends on your location. Florida is the hardest place to farm in the U.S. Disease, weeds, and humans — they all like Florida. So, that makes it a tough transition. We get 50 to 60 inches of rain, and things grow fast, and there isn’t a good organic herbicide, and the soil isn’t that dense in nutrients, either.
It’s so easy with conventional farming — just use ammonia, urea, and ammonium sulphate. But now we’re always looking for a good source of organic nitrogen. Our first year, we had low yields, and it takes a while to build the soil back. All those chemicals make the soil sterile, and we have to start building back the bacteria levels in the soil that are friendly for our crop. Still, by the second year we bounced back, and now our yields are as good as conventional farms.
And do you believe that the fruit and plant is better?
We feel there are huge benefits. When you have a healthier tree, you will yield a healthier fruit. There are studies that show that organic fruits have a better and [more] dense nutrient content. Organic citrus has a higher mineral content, more vitamin C and folic acid. One reason is that these plants build their own antioxidants as they fend for themselves and build resistance naturally, whereas plants with the synthetic fungicides didn’t ever have to rely on their own natural ability to fight disease.
What environmental benefits have you seen?
One of our groves is part of a University of Florida study, which is still ongoing. So far, the study has found that our grove had the lowest level of nitrogen leached into the soil, which is quite big, considering a lot of people get sick from nitrogen leaching into the water supply. I feel good when I hear stuff like that because, ultimately, we’re in it because we want to farm better, leave a lighter footprint on this world, and produce more nutrient-dense fruit.
How has this affected your family?
My family farmed 800 acres of citrus before the great freezes came in the late 1970s and early 1980s and killed off all the [trees] and the banks wouldn’t loan us money — so we lost it all. My grandfather, Ben McLean, and father, Benny McLean, stayed in the business as consultants, helping other growers with advice.
Now we’re raising money and getting back into farming with organics. Our family has really come full circle. I feel like we’re fulfilling my grandfather’s wish to go back to organic farming and my own father’s dream of managing our own groves. Now my brother, Ben III, is also in the business with a master’s degree in fruit crops. He is trying to figure out how to make a better herbicide and spray, which will be all organic.
And your grandfather? He must be really satisfied.
He passed away on Valentine’s Day in 2001. But he got to see the beginning. He was so passionate about farming, and because we were always growers we sold to juice plants. But in 1999, I changed that and we made our own juice and marketed the family name. Pappy definitely got a kick out of that. And I feel so good that towards the end of his life, he finally saw the entire puzzle pieced together from the beginning stages of growing to the end of making, marketing, and selling [juice]. It was such a reward.
Source: Business Week Online