TCB | How are you successfully managing through the current global commodity slump made worse by a strong U.S. dollar?

Chris Policinski: We have been focusing on business basics and managing our costs. For example, we are doing business the good old-fashioned way, by sticking to zero-based budgets in all of our business sectors. We have also made significant investments in technology that we are leveraging, and we have doubled the size of our company in the last decade. Scale is allowing us to absorb costs more efficiently.

TCB | Agropur’s acquisition of Davisco Foods last year vaulted the Canadian dairy co-op into the 20th slot on the list of the world’s largest dairy companies, bumping Land O’ Lakes down a slot. What are you doing to ensure your market share in an ever-consolidating global dairy industry?

Policinski: There is an ebb and flow to which of our businesses we invest in, and food assets are very expensive. So it’s hard to justify investing in food companies right now. We are making investments in our WinField business. In the future, we will likely make investments in our other businesses, particularly dairy.

TCB | What’s behind your recent forage acquisitions and how will they contribute to your bottom-line growth?

Policinski: We purchased Monsanto’s stake in Forage Genetics International, a company we owned together, and then Ceres to build our share in alfalfa. We think forage crops present a tremendous opportunity both domestically and globally. They are key to increasing milk production per cow. These investments create benefit to our members, both domestically and globally, where milk production per cow is much lower than it is in the United States. The key to improving efficiency is to add quality forage to the ration. Our presence in the growth markets of China and Africa is also highly beneficial from a business standpoint.

TCB | Isn’t it challenging to conduct business in China and Africa? What are you doing in these markets to mitigate risk for your members?

Policinski: By 2050, the world will need an estimated 70 percent more food. We have worked hard so we will be able to participate in that business over the next 35 years. Most of the growth in food production will occur overseas, especially in China and Africa, where the population is increasing and a growing middle class is creating demand for food and a growing demand for protein. We have to be present in those growth markets. In China, we are forming partnerships in which we help with the supply chain to improve output through better nutrition. We de-risk our entry because we are working on a business-to-business basis. Africa is different. It is earlier in its development, but it is still on its way up. In Africa, we are showing farmers how to grow things. We have been in Africa for nearly 40 years through our nonprofit International Development division. We know the neighborhood, and our company is known there. We are in the right place at the right time and we plan to make money right out of the gate.

TCB | How will helping your members grow crops more sustainably through SUSTAIN benefit your bottom line?

Policinski: We can leverage the tools we have used in precision agriculture to help farmers manage soil and water quality. For example, we can use GPS mapping technology to locate where land slopes toward watersheds and water pathways that farmers can then use to reduce runoff by planting buffers and grass. We think we can use our database to show how farmers are using less and less to grow more crops. Using fewer inputs helps farmers’ bottom lines, and it provides us the opportunity to sell more value-added products, such as slow-release nitrogen.