LEEDS, North Dakota - The Crossroads Cafe is a lonely wilderness outpost on the straight-as-an-arrow highway that leads across the northern tier of North Dakota. On this wintry day, an unobstructed blanket of snow reaches outward to the horizon in every direction.
With a little imagination, you
can almost see the wild prairie beneath the drifts, and the bison
herd hunkered down in one of the shallow draws.
But this is the Durum Triangle, one of the most intensely farmed
regions in the world. Most of the United States' durum wheat crop
is grown here, and inside the cafe, a few growers are grabbing
lunch. Virgil Anderson, 67, is working on a meatloaf sandwich and a
bowl of turkey noodle soup. He looks and sounds every bit the
farmer, from his thick, weathered hands and brown flannel shirt, to
the topic of our conversation: The latest farming
With every passing week, Anderson tells
me, more and more wheat farmers call it quits on this swath of
prairie. They succumb to wheat prices that have fallen to under $3
a bushel and the phaseout of government price supports in the
ironically named Freedom-to-Farm bill signed by President Clinton
in 1996. From 1992 to 1997, North Dakota farm income dropped 37
percent, while farm expenses rose 17 percent.
is a dilemma that does not respond to the remedies taught at the
agricultural college: "Cut costs, think efficiency and you'll pull
through." No matter how many times the calculation is scribbled on
sheets of paper at the kitchen table, the numbers just don't add up
to a profit.
generally take a down year once in a while," Anderson says. "But
some of these farmers have had four or five down years."
Anderson has tried to insulate himself from the
ups and downs of the farm economy by buying farms from neighbors
who've retired or gone broke. His farm, which covered 640 acres
when he began in the 1950s, now sprawls across 2,500 acres.
Anderson and his son, who's slowly taking over the family farm,
plant more acres in hopes of shearing a few nickels from the cost
of growing a bushel of wheat.
bigger doesn't guarantee survival, which is why a few years ago
Anderson and his neighbors decided to do something radical: They
built a factory.
Not far from the cafe,
surrounded by wheatfields, sits their $8 million pasta plant. The
300 investors (mostly farmers) who backed it hope to turn the
tables on traditional farm economics: Instead of shipping their
wheat as a cheap, raw material, they turn it first into valuable
frozen tortellini and ravioli.
Specialty Foods is one of 12 cooperatives that have been built on
the North Dakota prairie in the last five years. The Dakota Growers
Pasta Co. in Carrington makes dry pasta such as spaghetti and
fettuccini. In Hebron, dairy farmers bought their local cheese
factory. The North American Bison Cooperative of New Rockford is
marketing bison across the continent and into Europe. A Carrington
company called AgroOils squeezes the oil from oilseed crops that
are increasingly popular on the plains.
cooperatively owned businesses have a common denominator: They
knock out some of agriculture's many middlemen: grain buyers,
always been this sort of mistrust of the middleman and railroads.
Once the wheat leaves the farm gate, farmers know they get
screwed," says Fred Kirschenmann, an organic farmer and investor in
AgroOils. "In the current system, farmers have essentially been
reduced to raw material suppliers. They have no economic power.
Farmers are realizing there's just no future in this."
While these cooperatives offer jobs and hope
for small rural communities, they are not a sure bet. Some are
thriving and seem to understand how to compete in a global
marketplace; others are struggling and don't have a clue. Plains
co-ops marketing beef, carrots and beans have already
But no one denies that cooperatives
represent an important attempt at survival for an economically
bleak region. Not only do they offer jobs that keep people in these
remote small towns, but they make a case for those who believe that
150 years of farming the Great Plains is more than a failed
Climbing out on
The Farmers Choice Specialty Foods
company is housed in a sleek structure with a facade of black glass
and gray aluminum that seems to have been airlifted from a suburban
office park. But here, the factory and office stand alone, the sole
tenant in the Leeds Industrial Park.
built in 1996, is state-of-the-art, Anderson says as we walk in,
but he admits the company hasn't quite taken off yet.
"We're running kind of lean
right now," he says, and plenty of clues confirm this. There is no
sign in front of the building because the company can't afford one.
Fewer than a dozen cars are parked in front. The receptionist's
desk is empty, without a chair or phone, and it's not until you
walk upstairs that you see the plant's staff. The company employs
17, a fraction of what its investors had hoped for. But until it
gets more contracts for its frozen pasta, production will limp
along at less than half of
"There have been
setbacks," Anderson admits, as we sit around the long table in the
company's boardroom. Through a window, we see workers in hairnets
shoveling chunks of pasta dough and cheese filling into a complex
machine of stainless steel that turns out round ravioli. First,
there were construction delays, he says. Then the first president
of the company's board of directors was killed in a car accident
while driving home from a board meeting. But, more fundamentally,
the company lacked a savvy marketing campaign.
The management team brought in by the farmers failed to bring in
the promised customers: By the time the team was fired, the company
was already on the ropes. Part of the failure can be attributed to
the increasingly competitive pasta market. Growth in the U.S.
frozen-pasta industry - said to be 11 percent a year when the
company was born in 1996 - has since dropped by half. Some
observers say the company's philosophy - -build it and they will
come' - didn't work. Now Farmers Choice hangs by a thread on a few
This is a common story among the
cooperatives that don't make it, says Frayne Olson of the Quentin
Burdick Center for Cooperatives at North Dakota State University in
Fargo. Farmers are often ill-prepared to steer a co-op into
competition with already established
out of their comfort zone," Olson says. "They really have not done
their homework: What are they going to sell, who are they going to
sell to, in what form are they going to sell it in? They don't find
an end market first."
Virgil Anderson is a
dryland farmer who has spent his life waiting for rain. It is
stress that will ruin some men, but Anderson has endured it. This
pasta plant, however, is wearing him
"Sometimes, you know, it
just gets you right here," he says, grimacing and clenching his
side, "because of the pressure of knowing that us nine guys are
responsible for the stockholders. If it doesn't go right, I tell
you ... I don't know if I can explain the feeling."
Yet a farmers' cooperative can work. Sixty
miles across the prairie to the south, on the edge of Carrington
(pop. 2,500), the farmer-owned Dakota Growers Pasta Co. is booming.
The plant's parking lot is packed with employees' cars, almost all
American-made. Railroad cars and semi-trucks line up outside and
steam spews out of several stacks.
meet Liz Reinhiller, who was around in the early days of the
company and recites important dates in the company's history from
memory. When the pasta cooperative was little more than a dream, a
Minneapolis pasta-company owner said it couldn't be done: "Farmers
work three months a year and go to Arizona for the other nine
months," he was quoted in local newspapers. "They don't know what a
good hard day's work is."
"Farmers were torqued off" by
that comment, says John Rice, the company's vice chairman, and it
helped motivate the initial drive to raise capital.
In the early days, Dakota Growers resembled a
grassroots organizing effort more than a slick startup company.
When the company needed a logo for its first business plan, a
company executive set a can of Campbell's Soup on a piece of paper,
traced a ring around it and from this sketched out the
"We probably don't have
quite the glitz and pizzazz of some other companies," Reinhiller
says. Yet the approach works. The company manufactures pasta for
almost 30 different companies - including Safeway and Western
Family - and it is the third-largest manufacturer of dry pasta in
the United States. The 1,000-member cooperative also purchased two
Minnesota factories once owned by Borden Food
It reached this position through laying a
strong foundation and having some good luck. First, it hired a
management team from Kansas City that was already well-respected in
the pasta industry. And just as the $40 million plant was coming on
line in 1993, Borden's pasta division downsized, leaving a gaping
hole in the pasta market for Dakota Growers to fill. The timing was
"If you're a
religious person, you could call that an act of God," Rice says.
Investors knew that if the plant failed, they
could at least sell it off for 50 cents on the dollar to recoup
some money. But Borden's move gave the startup cooperative an
advantage they hadn't dreamed of.
Growers plant mills 40,000 bushels of wheat a day and employs about
300 people. Most of these jobs are essentially monotonous factory
jobs, and the turnover rate is so high that the town of Carrington
cannot fill them by itself. Workers commute from farms and small
towns as far away as 50 miles.
cooperative has brought some well-paying jobs to a region that has
few of them. For instance, there's the company's comptroller, who
grew up on a local farm and recently moved his family back to the
area from Tucson in order to take a job with Dakota
Unlike most small towns in North
Dakota, property values in Carrington are up. The town's motel is
expanding, and what began as a 25-foot-wide, downtown grocery has
become a supermarket on the highway. Carrington is the envy of
small towns across the state, and locals give the Dakota Growers
Pasta Co. most of the credit.
Yet beneath the
patina of a bustling economy, the town is not immune to the decline
sweeping the plains. Not all farmers belong to the co-op, and the
pages of the local newspaper fill with farm auction
Pastor Larry Harvala, who preaches at Grace
Lutheran Church on the eastern edge of Carrington and at a small,
white-clapboard country church, says he can see the farm crisis
infiltrating his town.
you have a flood or a drought, church attendance goes up," says
Harvala. "I believe that in this economic crisis church attendance
goes down because people get disgusted. And people are frustrated
in that, despite all the work that they do, they're just not able
to see a decent wage.
that our treasury is lower now than in the ten years that I've been
here, so financially it certainly has an impact. I think the trend
is towards pessimism," Harvala says.
good reason for pessimism. The state's population has dropped
steadily since the 1930s, when it peaked at 680,000. It now hovers
just above 640,000. In the countryside, farms continue to
disappear. During a two-year period beginning in 1997, the state
lost 1,500 farms. And next year, the federal Farm Credit Services
predicts, 2,000 more farms will disappear. Meanwhile, the remaining
farms - which average 1,300 acres - get bigger as they swallow up
the defunct farms.
All this makes cooperatives
very attractive. "There are a lot of people pointing to these new
co-ops as shining stars," Frayne Olson says. "Carrington was on a
downhill slide in a hurry. Now it is considered a growth area. If
nothing else, the (the co-op) really put the brakes on the slide."
Even if the new generation of farmer-owned
cooperatives doesn't reverse the decline in rural North Dakota,
they are forcing farmers to view themselves as more than just the
producers of raw materials.
Anderson, the struggle to make the Farmers Choice cooperative work
goes well beyond business. He speaks about preserving rural North
Dakota with the conviction of a preacher and the compassion of an
For too many years, he says,
he's watched families move away, rural schools merge with former
football rivals just to keep their doors open, and white, steepled
churches abandoned on the plains, their pews and bell auctioned
After investing so much, it would be a
shame to let Plains society slip away before his grandchildrens'
generation got a chance to live it, he
"We had to do something.
We'd feel bad if we didn't try."
Dustin Solberg, a flatlander from Grand Forks,
North Dakota, is an HCN assistant editor. Wayne Gudmundson's
photographs first appeared in his book, A Long Way to See: Images
and Voices of North Dakota; his work also appears in five other
volumes and in the New York Museum of Modern Art.