Ranch Investor Podcast

Can joining a co-op improve your ROI?

October 17, 2022 Ranch Investors Season 3 Episode 12
Can joining a co-op improve your ROI?
Ranch Investor Podcast
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Ranch Investor Podcast
Can joining a co-op improve your ROI?
Oct 17, 2022 Season 3 Episode 12
Ranch Investors

When is it most effective to work alone or work with a team? 

Round 2 with Rich Bradbury. In this episode, our guest reflected on his experiences working with various groups over the years and revealed in depth what works and what doesn't when joining a coop. DeVries and Bradbury also did not miss an opportunity to critique the issues of the US food system and third-party-verification.  

Website: https://highcountryrealestate.net/ 

#oregon  #esginvesting  #cooperatives #ranchrealestate #ranching #realestatepodcast #investing

Show Notes Transcript

When is it most effective to work alone or work with a team? 

Round 2 with Rich Bradbury. In this episode, our guest reflected on his experiences working with various groups over the years and revealed in depth what works and what doesn't when joining a coop. DeVries and Bradbury also did not miss an opportunity to critique the issues of the US food system and third-party-verification.  

Website: https://highcountryrealestate.net/ 

#oregon  #esginvesting  #cooperatives #ranchrealestate #ranching #realestatepodcast #investing

Colter DeVries 00:00.00

I'm Colter DeVries, owner of Ranch Investor Advisory and Brokerage Services. I'm an accredited land consultant with the Realtor Land Institute and a proud member of ASFMRA. 


The Ranch Investor Podcast is the most downloaded and informative industry-specific content that intrigues wild entertains.

Colter DeVries 00:00.22

Rich Bradbury on the Ranch Investor Podcast came out from Eastern Oregon to Billings, Montana. If this is the first time you heard Rich's name, you're gonna have to go back to our last episode for some background because this is part two and we're not gonna give a background. We're gonna just jump right into our last conversation. When was the Bradbury family came over? 

Rich Bradbury 00:00.54

The Bradbury family has been in the country for a long time. We all came in through San Francisco, so I don't have a fake American story. They all came in and votes from San Francisco. I still have relatives that were born in Ireland that live in Lakeview. 

Colter DeVries 00:01:17

Well, there was still a hard wagon ride to Eastern Oregon from San Francisco back in the late 1800s. 

Rich Bradbury 00:01:24

I had one great grandfather that did come to New York, and he said if he had known better, he wouldn't have gone to New York. He would've gone to San Francisco like everybody else because he ended up pushing the stage all the way across the country.

Colter DeVries 00:01:39

Well, one thing that struck me from our conversation yesterday is you and your family has been able to accomplish some things that are extremely difficult in ranching, and that's working with neighbors and community members. So we've talked about the historic MC, which you are a part owner in now, and your mom and dad helped put that together with the community members and the Nature Conservancy. Tell me more about some of these. You were hesitant to call it a co-op. 

Rich Bradbury  00:02:18

Yeah, no. I would call it more of a distinct operating entity, but we call it the MC group.

Colter DeVries 00:02:26

What other communist efforts have your family been involved in? 

Rich Bradbury 00:02:39

I was 12 when they started a company called Country Natural Beef, which is a pretty big name today.

Colter DeVries 00:02:47

I suspect it's a billion-dollar company today, isn't it?

Rich Bradbury 00:02:53

I guess it would be if you could value it in any traditional way but because of the structure of the company, probably not. But if you put in the number of ranches, cattle and pure acreage, it's a big deal. Over probably a million private acres in the West are under ranchers that are members of the Country Natural  Beef Beef. 

Colter DeVries 00:03:20

Right. It's hard to value a co-op because of the voting and ownership structure. On a discounted cash flow analysis, it probably could be close to a billion, but that'd be tough for the assets. It purposely was designed with no assets.

Rich Bradbury 00:03:39

Basically, the only thing a company owns is its brand. 

Colter DeVries 00:03:43

Yeah. That's the marketing. What is Country Natural Beef because this is gonna take us into the next Marxist revolution you have? 

Rich Bradbury 00:03:52

Well, it's not the traditional co-op that it had been for 35 years, but it is still very much a rancher-owned cooperative. It was uniquely designed and it sort of evolved over time. I'll just start at the beginning. My parents and 12 other ranchers had gone to the Savory Institute in Albuquerque. Over a two-year period sort of got together and decided that they would try to find a niche market that they could fill. We're fortunate to be in Oregon. We had really great leadership in Doc and Connie Hatfield, who are tremendous people and a husband-and-wife team. Both brought lots of great skills to the table. Connie had a lot of drive and a lot of marketing vision. Doc was very pragmatic, logical, and really great at holding relationships and negotiating. Connie was good at negotiating also, but she was much come into the room, throw some tables over and tell everybody that they should be doing whatever was right, and then Doc would smooth it over. But she just thought that it was in the early 80s that it was after the bit last of one of the big cattle booms, and things were settling down market was probably over-saturated with cattle. She really felt for the amount of work that they were putting in, they should get better value for the cabs that they were producing. She started going around asking people what they wanted, and at that time we were sort of in the jazz-size Jane Fonda era and people wanted lean beef. She got us one store in Bend Oregon in Port Market, which is still there. I was in it last week. It's a beautiful store but it's very much Bend Oregon. It's very much West Coast, San Francisco, Seattle, and Portland but it just happens to be in the desert. It has that type of health-conscious consumer that has the discretionary income to buy a more value-added product or premium beef product. We went along and the Newport market in the first year took like one head. They actually had a fight over who got to haul it to the processor. That sort of happened. It went along for a couple of years and there was one head, three heads. Then, just how random the universe works, there was this giant that was so interested in Oregon beef from Japan at the time. They had a soap opera called from Oregon with Love about a Japanese family that had a ranch in Oregon. There was this man about getting beef and so that is really when the co-op got named Country Natural Beef, but originally called Oregon Country Beef just for the reason of that to market to the Japanese. We partnered with a Japanese company. They start shipping beef from Oregon from our ranches over to Japan. It was a really great relationship. It lasted for years. Then all of a sudden, it had other holdings that sort of caused it to crash and go bankrupt. They left us hanging with all these cattle that we've been processing. And once again, the universe was working in our favor. Whole Foods was moving to the West Coast and there was another one called New Season, not New Seasons of Whole Foods. We were able to start putting those cattle into that supply chain. Whole Foods just kept growing and we kept going along with it. Now we market cattle all over the MLS coast and Denver. 

Colter DeVries 00:08:25

So that's amazing that you can get ranchers to come together and do that, especially in the 80s. I think every cattleman group, county, and state should form a co-op for value-added marketing to vertically integrate our processes and cut out the beef brokers and the processor. It's a natural capitalistic idea to streamline vertically integrate, and it's very difficult. The feasibility and co-op development are something that I only wish upon my worst-end enemies. 

Rich Bradbury 00:09:09

What you have to think about when you think about a co-op is the economy of scale. So by pooling resources, you develop an economy of scale. We started another co-op in 2015, that's grass fit and it's still around. 

Colter DeVries 00:09:27

Like any good rancher, you said I'm gonna spin-off, be a maverick, and do my own thing?  That's the natural transition of ranchers. I'm gonna have to be a maverick in a trailblazer, I'm gonna have to leave the group and go do my own thing. 

Rich Bradbury 00:09:49

Well, here's the interesting thing. One of the requirements to be in Oregon Country Beef or Country Natural Beef was that you had to be on a weekly call every Wednesday at six o'clock in the morning. 126 managers get on a phone call and we talk about the beef business. The other requirement is you had to go to the two meetings. They started in a barn in Brothers Oregon, and now they're at the Sheridan so people can fly in. There are 300 people there at any given time. There are salespeople and people that just want to get in the door. You're asked for a seat in the Country Natural Beef community. You're doing something as a salesman. It's an incredible experience to go watch.

Colter DeVries 00:10:43

That's amazing growth from 12 to 300 producers. 

Rich Bradbury 00:10:47

Well, it's not, it's partners. One of the unique things about our experience with Kitara was we learned about mutually beneficial relationships. From very early on in the co-op history, we always strive to create a relationship with our business partners that wasn't cut-throat. If they're having a tough time, we'd help them mitigate the risk a little bit. We'd take a little hit and balance it back and forth. So like Whole Foods comes to us and say, “Hey look, we need to run and bump up our beef prices. In the protein section, we need to pull more people in. We want you to take a little hit here.”. It's still premium. You just take a hit on a premium so it's not the end of the world. Say that you're off the price 10 cents and they get more people in the door. In Whole Foods, the beef counter's a cost leader. It's to get people in the door. If they can make enough deals on proteins, then they're gonna sell more stuff in the store that actually adds value to them. That's the kind of relationship. There were times we had to go to bat for Whole Foods over some union stuff that happened with some of the dairies in Oregon. We got lumped into it because of the proximity of where the feedlot. We went and stood side by side with Whole Foods and said, “Well, this is how it is and we helped educate the consumer about.”. It wasn't as big a deal as they'd said. So mutually beneficial relationships. 

Colter DeVries 00:12:38

Do you call your mutually beneficial relationships a comrade? 

Rich Bradbury 00:12:45

No.  The Japanese word for it is Shinra. It's traditional and it goes way back to Japanese Culture. Shinra is this thing where you create a win-win for as much as possible for people that you're around. 

Colter DeVries 00:12:59

I'm being a hard-ass rich because I have dabbled in co-op development. In college, I explored communism but few years ago, we were trying to launch a cross-bank co-op modeled much like the nature conservancies. We analyzed what they were doing with Ranchers Stewardship Alliance closely and the winning aces of the working group. We added a shot at some economies of scale and some leases. The theory was why not use this grass bank as a heifer development enterprise because heifer development enterprise is your most expensive livestock enterprise on a ranch. Much to every rancher's denial, if you outsource that enterprise, and buy bread heifers, they produce them cheaper and at a better quality than you do on your own ranch. I'm sorry, 98% of ranchers out there. You do not produce the best replacement heifers and you don't produce them as a cost leader. So that was the first enterprise you should consider outsourcing with your livestock production. That was our theory as academics in an ivory tower, but trying to put it into to actually get it going. Part of the problem is I was trying to ramrod this in March of 2020 when nobody was sure if we could have in-person meetings and some of the partners like,  “Well these conservation groups from blue areas where they show up in a Subaru in Patagonia clothing.”. So chicken shit of Covid, they would not take an in-person meeting. The government employees couldn't take an in-person meeting, and you had this huge battle between ranchers who just don't care about covid and some necessary working partner relationships to help launch this grass bank co-op. But then we got some traction. We got on some leases and actually put the working plans together. We needed only five members to form a co-op in the state of Montana and we could not get five ranchers to work together on outsourcing their heifer development enterprise. They thought that their bulls were better. They thought that their calves were better. They thought that their vaccination program was better. They thought they could produce them cheaper. They were wrong on all accounts, definitively, objectively, and financially wrong but denial is a very strong thing to deal with. That's why I cast these stones of calling you a red. But let's get back to that. 

Rich Bradbury 00:16:19

I'll tell you how it works. We sit in giant circles and everybody gets to talk. There's a facilitator who since the beginning monitored each set of meetings. When you go to Portland, there's a circle that encompasses. Most of the people are at the back of the room, and we have to have a room big enough. The biggest space in the entire room is the middle of the circle, and then you have everybody. There are now two rows, three rows, or sometimes of people back to back, but everybody in that circle speaks. They don't have to say anything, but they have to turn it in. They get the mic and they have to say, “I don't have anything to say or I agree with this.”, but it's designed so that everybody talks. When we're making decisions, that protocol in the circle states that way. There's nobody talking over each other. If you want to make a point, you have to wait until your turn comes back around the circle. What you find is you find that the people in the rest of the room are really pretty smart. Duck hat fifties to say. I have a pretty high IQ, but when I get into this circle, it gets raised by 25 points. So what you thought was going to be the answer, by the time it works through all these people around this circle, you start to see flaws in what your answer was. You start to see better ideas, and then it just naturally resolves. But you have to limit the people talking to each other. You go out of it and you have to get the voices in the room with the people that would normally not talk. That's pretty powerful because there are a lot of smart introverts out there that get stepped on by people that are extroverted. There are people, I think introverts, probably actually spend more time thinking through problems than people that, like myself, talk a lot of time and so you need both. If you don't give introverts time to get their voice in the room, you lose all that value. 

Colter DeVries 00:18:42

That's a great point. Their personality type is very analytical. God rest his soul. The former founder of Stock and Grass Farmer had a quote. He was against farms ag co-ops because if everyone has an opinion and thinks that their opinion is valued & weighted equally, then there's no sense of leadership, accountability, and responsibility. How do you get past that? 

Rich Bradbury 00:19:18

There are leaders. We do have leaders different people take on. So what emerged in Country Natural Beef and what's emerging on our newest co-op Desert Mountain Grass Food Beef is the marketing team takes on. They really sort of become the CEO of the operation. They're the customer front per people. They are the ones that are out talking to the people that are buying the beef the most. They're getting feedback from the people that we need to sell our beef. They sort of set the tone and so you can't be switching marketing people all the time. The marketing tenures tend to be longer, and so leadership actually falls on them. What I've seen of the evolution of a co-op as it grows is new rules start to emerge. Bookkeeping is one we're struggling with, and with the new co-op right now who's gonna take books, and who's gonna be responsible for that? That's naturally gonna work out. It’s not working out as fast as most people would like it to work out but when we get to the solution, it would be the best solution. That emerged in Desert Found Beef. The lady that was their CFO basically was from Antelope about Wild. She was right there at Antelope. She's CPA. She went to Oregon State more than qualified. She ran a multimillion-dollar, possibly billion-dollar business for 30 years and she sourced all of her employees from right around there. The way that the co-op works is that was her company. So she was an entity within the grander umbrella of the co-op that provided a service for the co-op and replacing her was no small thing. I mean, now there's an entirely new accounting and new bookkeeping staff that's been set up, and they brought new ideas. They brought a platform to manage the inventory a little bit better, that kind of stuff and then production naturally evolves pretty soon. You get so many cattle and you have to fulfill so many things that one group of people has to take on production and it starts in a little business that just manages the cattle. In the co-ops that I've seen to be successful as it evolves, all these little businesses start emerging under this bigger umbrella, but they're not controlled. There's a level of autonomy so that those little businesses don't have to go to the whole group every time that at some point the group decides we trust these people. We're gonna have a certain amount of oversight on them, but other than that, we're gonna step back and just let them do their job. It's sort of that Malcolm-compatible thing and defaults to trust. So when you find somebody that can really do a good job, how much do you really want to lock it or turn it off with them?

Colter DeVries 00:22:24

Yeah. So somewhat decentralized and the non-hierarchical structure is what you're saying? 

Rich Bradbury 00:22:29


Colter DeVries 00:22:32

And as you said,  Who Not How is another good book about you delegating authority and responsibility to people because they can do a better job than you. When you're paying them and they are an expert in their field, why waste your time micromanaging and writing hard on them? That's what they're getting paid for. They take their job seriously. Delegate that out and trust that they're gonna do a better job than you are in their area of expertise. 

Rich Bradbury 00:22:44

Yep. And I think the other interesting thing that you have to learn from being in a co-op like I have and it's taken me 40 years to figure this out, is there's a big difference between shareholder and stakeholder.

Colter DeVries 00:23:19

What's the difference there? 

Rich Bradbury 00:23:21

A lot of ranchers believe that they can go into these things as a shareholder. A shareholder is somebody that sort of monitors how it goes. They expect people to give them reports. They expect all these services from these co-ops, especially early on. When you're bootstrapping a co-op, then that's the only way every co-op can really get built because ranchers don't have any money. Their money's all tied up in equity. Any way of credit in that, you have to either pay somebody to create it or you have to do it yourself. That's the role of the stakeholder. The stakeholder is the rancher that gets in there in the beginning, goes to the stores, goes to the processing plants, and works every week or sometimes we have five calls a week in the grass of co-op to figure out how we're gonna solve these problems. That's a stakeholder responsibility. A shareholder gets the report after the flooding calls. A lot of people think that because they're like co-ops that they have in the Midwest with gas stations, corn, and freight fuel feed, they're just a shareholder. They get some benefits from being in this co-op. A rancher producer-owned co-op gonna have to have a stakeholder mentality about it. You have to manage it just like you manage your ranch. It's not something that you get into and then walks away from. It took 3-5 years for Country Natural Beef to completely flop pretty much from a stakeholder relationship to a shareholder relationship. So now you can pretty much send cattle. You don't have to be engaged in all the meetings and don't have to go even though most people do because it's still an informal requirement that the co-op has. It pretty much runs without that everyday rancher involvement. But it didn't naturally do that. It took years to get to that point. I think that's what my family struggles with. We just control and we prefer that stakeholder relationship. I still trust the people that do the books. I still trust the people that do the production, but I like to get my hands dirty. I like to be in it and that's why we're really enjoying doing this grass feed. Grass-fed brings a whole different level of challenges than traditional commodity beef. I wouldn't say Country Natural Beef is commodity beef, but that first swing in the 80s of natural beef is quickly commoditized. There are a lot of options out there. 

Colter DeVries 00:26:15

In High Desert, your marketing team must be doing an excellent job because I knew of that brand and that company. I didn't even know they were a co-op, but I knew of that brand of beef before I knew you. So they're out there, they're doing a great job.

Rich Bradbury 00:26:29

Yeah, it's relatively small. It's Tracy. 

Colter DeVries 00:26:35

Oh well, you're doing an excellent job. 

Rich Bradbury 00:26:38

So the interesting thing that we probably took from Country Natural Beef when we started Desert Mountain Grass Fed Beef is we put a lot more money per head on marketing. It's almost to the point where it's choke-worthy to do it but to get established, that's just something that we have to do.

Colter DeVries 00:27:00

So taking it back to the ranch investor, how does being a member of these co-ops benefit your overall investment in the ranch?

Rich Bradbury 00:27:17

There's the direct financial way. All these co-ops are complicated because you have to figure out how to finance your cattle until the retail. But if you can do that, the premium on the hook at the retail level is so much greater. It just provides you with an incredible amount of cash flow. I think the real benefits, and what keeps people in these co-ops is you're challenged all the time to bring a better product to the market. Anytime you're challenged to bring better products to the market, you work constantly in your organization, branch, and business trying to find improvements and efficiencies that you can make so that you can satisfy that customer and the end customer has demands on you. There are a lot of third-party certifiers that I don't particularly agree with, but that's a constant pressure back to the ranch to continue to produce this quality. The benefit of being in a co-op is you do not have to be in that struggle by yourself. You know that there's a bunch of other smart ranchers that you can take a problem to, you can work it through together and work out the better solution for it. It's the intrinsic stuff I think that people miss in the value of it. If you can get all the interest stuff lined up and working, then the economics sort of work themselves out but the tough and messy part is the stuff that doesn't.

Colter DeVries 00:29:04

It's almost like a mastermind group. There's a peer and professional support everyone is sharing best practices, and it's like having a board for your ranch which most ranchers hate the idea that I'm not gonna answer it and I'm gonna do it my way. But they also get left behind when it comes to the guys who are taking constructive criticism, who are considering other ideas, and who are analyzing what the leaders are doing in that industry. I see it as this community. There's no group I think going on. When you're own independent maverick rancher, you have a board of one who is the chief cook and bottle washer. That can be dangerous though. 

Rich Bradbury 00:30:08

This is my big say, the internet is a graveyard of failed grass-fed operations. You can still go on the internet and find them because they don't even take their websites. Independent guys that had grass-fed figured out and did great probably had a great market for two or three years. They have a way to keep fresh products year-round or any number of things can happen that you need that economy a scale that absorbs. Another benefit of a co-op is that it's just not you. Say your 150 heads behind, if it's just you, then you're screwed because you're not gonna make that delivery. But if you have another, if it's just 150 head in 3000, then you have a lot more options than you can make up. We have Tracy and there's not somebody at the ranch worried about marketing all the time doing the online store or coordinating that kind of stuff. I get two or three emails from her today, like articles I should be aware of. A lot of the group sort of uses her as a clearinghouse and sends it out. There are just these little benefits that you can get over that initial block in your mind of that independence. I've never really felt, and all the time that I was in a co-op that I lost any independence. Actually, I think that the choices that my parents made in building these business structures actually gave us a lot more independence than what we ever had before. A lot more options and quality experiences that if I would've stayed in Plush and stuck to commodity ranchers, I'd never have been in a store in Salem or Seattle, and I wouldn't have been in these huge group meetings and solved these like the antibiotic problem. When we went non-antibiotic, you would've thought it was the end of the world. The solution was relatively simple, but it took 13 intense meetings, yelling, screaming, and throwing hats on the ground but we made the jump and it was worth it. At the time, we were innovators. The only people that had not done antibiotics were on this very small scale and when Country Natural Beef decided it was going to go in and buy free, it was a big deal. We're early market movers on it at a reasonable scale. 

Colter DeVries 00:32:48

You brought up third-party certification, and I think you might have some strong opinions about that. Tell me what is third-party certification and give a little background to it as well as the federal government thinking that they can also be the Arbiter of truth and standards with USDA organic. Give us a little background on what it is and why you are a voice out there who continually shits all over third-party verifiers.

Rich Bradbury 00:33:35

At first, it was a really clever marketing idea and it was something that John Mackey came up with at Whole Foods. I'm a big John Mackey fan. He's a libertarian. I like the way he thinks and I think he just made a big mistake with this because he brought out the GAP and that was really the standard.

Colter DeVries 00:33:53

What is GAP? 

Rich Bradbury 00:33:54

GAP is the Global animal partnership and it's basically the humane treatment of animals standard.  

Colter DeVries 00:34:04

And there's a level of GAP. 1, 2, 3, 4, 5, 4, 5. I'm a big fan. I've yet to read his book but John Mackey is an outstanding libertarian who has changed our food system singlehandedly. 

Rich Bradbury 00:34:19

Conscious Capitalism is a good book. Mackey's brilliant. He's always getting interviewed by Nick Luby, Reason Magazine. I think he went too far with GAP and if he ever got one on one, I think he would probably make a mistake or he could have gone a different direction with it.

Colter DeVries 00:34.00

He created standards to show consumers how his product of beef that he was selling on the retail shelves of Whole Foods was better than that of Walmart and Costco. Yeah, that's where it started.  Maybe some clever marketing. Maybe there was actually some good social capital being created and some value from it, but where have we gone from there?

Rich Bradbury 00:35:18

Yeah, so Country Natural Beef was actually really instrumental in the original GAP because it was originally a pre-program that we brought over here and tried to modify. Our house doesn't live in barns at night, so it was really hard for the Europeans that came over here to come out to High Desert Ranch. It's like, “Where are all your barns? Where are your cattle sleeping?”. I argue all the time and still to this day when I'm going through my GAP certification because we always get new people because the turnover is so high. They're like, well, you just leave them out in the desert. I'm like,  what is more, ethical than not messing with something that's just going about eating grass and having this? Why do you want me in these cattle all the time, bugging them, tagging them, and doing it? I said, Where is the real ethical line here? I think a cattle would not like to see me for six months other than maybe occasionally I drive by them in the pickup and make sure they got water. They probably appreciate me checking I have water. 

Colter DeVries 00:36:26

That's a nuanced detail of a standard of GAP. But today there must be 43rd-party certifications out there. I mean, Savory has one. I would imagine Patagonia has one. What the hell do all these things mean? I'm not gonna put words in your mouth, but we don't need another snake oil greenwashed third-party verification. 

Rich Bradbury 00:37:11

Having spent time in oil and gas, those have a standard and their gold standard is the API, the American Petroleum Institute. And it's very much a collaborative group of people that are in the oil field. All the companies agree to it and people are advocating for more safety in the oil field. It's a very good overall set. It creates educational programs, certifications, and training. Like I have multiple different API endorsements. I never felt like it was an infringement on my business and none of the businesses I worked for. It was an aid for producers. For some reason in agriculture, and I think it's our propensity to jump on value-added stuff, sometimes we don't read the fine print about what we're getting into. We would've never been allowed to create that API for ranching. It just never came about and so what we've been stuck with is, and this is my joke, anybody can become certified for a certification organization. You can write the certifications in your underwear. and I've actually seen certifications that are stolen from other certifiers where they didn't even bother to take off the name of the one they stole it to on the fine print of the footnotes. It's a really lucrative position. It's one where you may have no risk and you make no investment but you can control everything. This is many layers to this, if you're an advocate of ESG, which is Environmental Social Governance, this is a certification program, not agriculture is a really good tool for you. You can force lots of change with not much investment. No market should be influenced by anybody that doesn't put investment and risk on the line.

As the rancher, I take the lion's share of the investment. I have to go to the bank. I have to find the collateral. I have to sign into it, and I'm on the hook for that investment. In the entire beef production supply chain, I have the most on the line. I have the most risk, and I have the most money on the line. Every party there after me has less on the line. When you get to certifications, they have zero on the line and they have a given amount of power if they want to wield it that way. I think that's unfair to put agriculture into, I don't believe in the humane treatment of animals, but I do think it should be a non-abrasive body that manages it that isn't about profit. They will tell you that they are nonprofits I've seen a lot of people in real estate that have nonprofit organizations that make a lot of money. If you look at Nature Conservancy, I think part of their drawback is they were making a lot of profit. I think they had to stop and make some real philosophical changes so that they could maintain that sort of non-profit quality that they wanted because I think they're getting dangerously close to not being able to defend that anymore. I think they recognize that and they're dialing it back.

Colter DeVries 00:41:07

I want to summarize this, so help me understand it. What I hear is that your issue is these armchair activists and environmentalists, who are living in Blue Islands on the coast and are academics and ideologues, believe that they should have a say in creating a standard for ranchers and product producers. You're saying that they are so far removed from the actual implementation of their ideals and programs. But not just removed, they don't have a true economic stake. They don't have a true cultural stake in what's happening. They bear no risk. They put all that onto the producer and you believe that they are trying to control the food system and producers. 

Rich Bradbury 00:42:12

A hundred percent. 

Colter DeVries 00:42:14

So now you brought up that that's not fair. Well, tough shit, Rich. Life isn't fair. So what's the solution here? 

Rich Bradbury 00:42:25

Well, I'm saying that other industries have solved it and they have more fairness over these sorts of governance bodies. 

Colter DeVries 00:42:35

I'd say absolutely. The Realtor Association is a private trade group driven by the members who have the largest stake. Realtors are self-policing. They do a better job of industry standards than the Department of Labor could ever do, and they do it much more cost-effectively. The realtor is probably the biggest example of why private stakeholders in that trade in that area of industry and economy can self-regulate better than the government. The next one would be FINRA Financial Industries. FINRA is a much better self-policing member-owned and member-operated organization for the financial protection of consumers. The Realtor Association protects consumers at the end of the day. They don't protect their members. And so I agree there are better models out there. What's the solution for beef and for ranching? 

Rich Bradbury 00:43:40

I struggle with this because I believe that people in production agriculture really don't think that there's a way going forward and anybody that stands up. It's almost like the monkey experiment and the bananas. There are bananas that are above the pyramids that the monkeys can just barely reach. And so over time, the monkeys will go up and they will for the banana. But every time one of them gets really close, they all get hosed down. It doesn't matter where they're at. Even though the bananas are attempting things, they just never go to the banana. What they do over time is work out the monkeys that have been hosts. They add a new one and the new one goes. Eventually, over time, there are no monkeys that have ever been sprayed, but they know that they would be conditioned not to pursue the bananas. They don't know what the real repercussion of it but they don't ever go after the banana. I think that's the place that we've got into agriculture. I think that's a lot of that has. I think there's this divide, especially in the mind of American consumers. Most of the bad stuff that leaves a bad taste in the consumer's mouth doesn't happen on the land level. It happens in boardrooms. It happens in the parts of the supply chain. The choices in the supply chain and those boardrooms are what affect the amount of money that we can put back into the land to improve it. It's very convenient for those people in the supply chain and in those boardrooms to just push all that negativity down to the ground level where you got the guy that's making pennies on the dollar for what he's putting into it and say, “Look, there's your villain.”, even though the supply chain is set up to make that person at the very beginning of the process fail. 

Colter DeVries 00:45:56

So again, it's easy to point out problems. What's the solution? 

Rich Bradbury 00:46:04

I think the solution for me would be who produces. It would be nice if the Cattleman's Association could come up with something that worked for Walmart, Costco, and Whole Foods, had real practical people that were doing the certifications, and that we evolve that. I would also like to see them create training that evolved around this, like low-stress animal handling, maybe doctoring strategies, and stuff, and not benefit just desert out, grass beef, and certified Angus, but benefit everybody and make it relatively easy access for maybe economically challenged farmers or ranchers to make the cost lower and have the bigger guys sort of pick up the economy of scale on it. There should be one true certification or humane certification that encompasses all the stakeholders, shareholders, and every party that's up and down the supply chain. People that do the certification should be the ones that are probably closer to where those animals are raised to land and be more of a peer to the ranchers and farmers than somebody– My current certifiers auditors are in New York. The last one I got was never been in the west of Mississippi and she'd only been on three dairies. I'm pretty sure she had an art history major.  I don't have any problems with this person. I run a high Desert Ranch operation that encompasses hundreds of thousands of miles. I run a common with a bunch of different people and we run horses. Our cattle don't sleep in barns. Our ranching philosophy is pretty much hands-off if everybody's healthy. I mean, we're not engaged with our cattle, but if everybody's healthy, we don't really screw with them that much. And if you get into the documentation and everything in these certifications, there's constant tagging and doctoring. I don't see how the animals ever get a break. If you were to do a GAP five or GAP four, you would be harassing that animal on a weekly basis. I don't think that's what anybody set out to do. Every little interaction you have with an edible creates stress, and maybe they just get to live with it. But I don't know that that creates the most healthy animal either. 

Colter DeVries 00:49:30

Well, I'm gonna keep belaboring this issue because as a free-market libertarian, I don't mind that Savory has their own program. Patagonia probably has something in the World Wildlife. Find out, I don't care. Bring out 60 different certification programs from the coast, the blue islands, that were developed by academics in an ivory tower and let the best one win out. Let the best ideas compete and went out. What's wrong with that?

Rich Bradbury 00:50:01

Do you think that's really the world we live in?

Colter DeVries 00:50:03

So you would say that it probably follows the money and whoever gets the McDonald's contract and whoever sold their bullshit program the best is gonna win, even though it might not be the actual true program creating the most value? 

Rich Bradbury 00:50:20

So there is a certifier that a lot of ranchers use, and I won't say it, but the two founders of it, I actually had an investigator hired to dig into the background of them. The last paperwork I could find on the guy was when he stopped being the yield quarterback in 1994. Other than a couple of addresses in Colorado, he virtually has a billable history. His wife, on the other hand, has quite a history. She worked for two of the largest packing plants that had two of the largest recalls in history, and then she became a marketing director for McDonald's. After they founded their certification program–

Colter DeVries 00:51:01

So the fox is in the hand house? 

Rich Bradbury 00:51:09

I think so.

Colter DeVries 00:51:09

Ranchers have brought in a Trojan horse. What's wrong with following the money? I mean with transparency in the long run. We, you, and I are saying that this is bullshit in the short run, but won't all that come out in the Washington long run? 

Rich Bradbury 00:51:27

So let's go back to this, and this isn't a conspiracy theory or anything, but I'll start another podcast first. How much do you think that ESG is gonna affect agriculture?

Colter DeVries 00:51:51

I think it's continually affecting agriculture but it will get commoditized. Once it is greenwashed by BlackRock, Golden Sachs, Walmart, and Amazon, then it has no value. It is a commodity. It's not rare. It's not unique. I think in the short run, we are seeing a lot of changes come from a lot of different directions. It's happening, but I don't think it's gonna last is my theory. 

Rich Bradbury 00:52:36

I guess the question is how much pain it's gonna be afflicted on agriculture. Why they're figuring out that it's not gonna last? 

Colter DeVries 00:52:44

Yeah. There's a lot of pain. 

Rich Bradbury 00:52:47

So I find this interesting crossroads. The United States has this really unique structure that's probably unique amongst the world, and I get a lot of backlash for this, but we really do a pretty good job in this country of protecting our environment. We have the EPA. We have a string of water quality rights. USDA alone has a rigorous process to make sure–  Yeah, we have recalled that every now and then, but they're usually traced back. All these food systems around the world are better than ours. I don't really think so. 

Colter DeVries 00:53:23

No way. I'm not just a nationalist and American exceptionalist but now by far, we have the best standards for ecosystems and environmentalism. Our producers are the most animal husbandry friendly in the world. We are the most friendly to our waterways. There are continual improvements that need to be made with soil and cropping but we are the best in the world when it comes to conservation. 

Rich Bradbury 00:53:53

It's a continuous process, and we get better every year. My education level is much higher than my grandfather's. He considered himself a conservationist. Our education level is greater now than what he knew. But the unique thing about American agriculture is it's about 80% controlled by small businesses and family-run businesses. They're decentralized, and this is the problem with the co-op. They're staunchly independent. That's why the co-ops don't work at all. But they hold a line. They are holding back the forces in our economy that will save our economy. If you don't think that it bugs corporate's arm interests that all these independent producers are out there, well then you're wrong. Because I think when you really look at it and you look at our culture, it's a $3-7 trillion a year business. I think a lot of corporations are waking up to this. You see that with Bill Gates and you see that with all the investment in farmland. The biggest storm on most people's side is they have to contend with all these starkly independent private businesses. The amount of equity behind all those independents is immense. Agriculture's not something that's easy to break into and the learning curve was really high. We've seen the transition throughout history. Originally the West founded Manifest Destiny because of the cattle trade and the railroads came along to connect cow towns. There were other things that were happening, but there was a lot of investment then. There's been a lot of investment like we talked about in the 80s with the insurance. There's this constant turnover, a corporate investment, but one thing that's always consistent in the independent small business that is it’s strong and the backbone of agriculture. I think that these corporate interests cause a lot of problems when they're trying to get into it, but it's like waves crashing on a rock.  I guess it’s eventually the way down, but it's really tough. 

Colter DeVries 00:56:19

So would your belief be that a third-party certification program is a way to control and consolidate?

Rich Bradbury 00:56:30

That would sound conspiratorial. I want to come out and say that–

Colter DeVries 00:56:34

I don't think it sounds. I mean, that might not be the agenda that you don't 5 old white men sitting in a room on a higher rise in New York City saying, “Here is the method to control and consolidate.”. But in capitalism, we want to control and consolidate. That's just natural. We want to buy all the means of production and the resources around us. We want everyone working for us at a price we determine that they're gonna work for us at. That is capitalism. 

Rich Bradbury 00:57:12

I think that there's this new– I'm gonna try and choose my words very carefully. I think that the. Philosophy and the independent streak of ranchers and farmers are annoyances to many people. I think that deepens our DNA. We are conditioned to worry about our food. We have taken 98% of the population out of direct production hunting and gathering their own food, but we have not installed that program that's downloaded into their head. They cannot help but screw with the food system. It's at a genetic level. So here they're looking at this evil 8 % of people that are actually production agriculture people and everything in the culture tells them that 8% of the people are basically out to kill them. They're poisoning their water and food. That whole thing is manifested in people's heads. I don't know if they're consciously trying to sabotage their own food system. I don't think they are but at the same time, the caliber of character it takes to be in production agriculture runs directly contradictory to what most people experience in their own workplace.  It's a very uncomfortable thing for them. I see this huge clash and I see that it's actually probably adding to our healthcare problems. It's adding to this BCD in the United States. It's creating a lot of systemic problems because of this lack of understanding of where people come from. 

Colter DeVries 00:59:47

I'm gonna take a stab at summarizing that. 

Rich Bradbury 0:59:50

This is why I love these because I get to run my crazy theories and then somebody puts it together more eloquently than I can.

Colter DeVries 0:59:56

Well, I want to necessarily call it a theory. It's your observation because you see it. There is a certain amount of truth to what you've just said. I'm having a hard time summarizing that. If I had to explain it to my daughter, Rich Bradbury believes that there is an effort that vilifies American producers that would be whipping them into control and that would force compliance upon American producers because they're the last vestige of independence. The way they live, vote, they carry guns–  That is unacceptable to have a structured society where the elite can control it. That's how I would explain it to my daughter. 

Rich Bradbury 1:01:04

And you gotta do it because you gotta keep the food supply safe.

Colter DeVries 1:01:10

Well, you have instilled fear in the consumer that if don't vilify today's American producers, you're not eating safe food. You're not eating healthy food. Even though USDA is complete bullshit, we still have the safest food system in the world. 

Rich Bradbury 1:01:31

And it's amazing how many people argue that point. I'll take my hat off to Europe, Australia, or New Zealand because they have some pretty amazing programs, but I mean, they're not better than us. When we had the first mad calibrate outbreak, it took less than 72 hours to find exactly where that animal came from. They used all the USDA brand inspection and sales slips to trace it back. They talked to the people that were in the celly yard and that hold animals. They found it within 72 hours where did the origin of that come from. 

Colter DeVries 1:02:03

And if you disagree with my summary of Rich's view and how he sees his perspective paradigm on the world, just go turn on Netflix and watch a recent program produced by Barack Obama where they glorify the USDA. They presented a completely one-sided opinion and what the hell is it called? I'm trying to find my phone to look it up. But, they actually titled this program something towards the effect of the realities and the truth of the matter like they are the gold standards produced by Barack Obama. They are the gold standard of what truth is. Their first episode was on beef, and it was saying how great the USDA is. I was like, wow, the 40 million Netflix subscribers who turn that on while they're sitting at home who don't know– They've never been to a ranch and rural America, and they've never met a rancher. They're gonna watch that and they're gonna think, “Oh my gosh, that was mind-blowing. I'm so glad we have the USDA on our side and those small independent packers, those mom-and-pop shops need to be regulated. They need to be controlled because they are dealing with so many biological hazards that are gonna kill my children and create disease in another pandemic”. It is just mind-blowing the effort out there. I'm gonna go ahead and say it to pretty much dehumanize the rural American produce American producer.

Rich Bradbury 1:03:53

–Yeah, and rural America as a whole. We have been an interesting time. Am I completely pessimist about it? No, I think these things come in. I think that we'll survive it. We'll get out of it. I don't see how it's gonna happen, but I think what always happens in this economy just takes the wind-down of that, those kinds of movements. We seem to be headed toward that. You have some time of prosperity, maybe an election or a political change in the posture and you move on a little bit longer. The intensity of the public's perception of agriculture right now, I believe is at the same height that it was in the early90s. I felt that heaviness to it and we got through that. It passed. In the late 90s and early 2000s, I think we're all pretty good for our culture. We saw some transitions and I think that's really when the organic certification came along, which has many flaws, but it seems to be a system that works pretty well as well as the government entity can create a system, and the people that are in it really believe that it's a fair system. We're just going through this sickler thing and right now we're amped up to 9 or 10, and the public fear is high on many different levels. The media is terrible, and it just intensifies everybody's feelings about stuff. Unfortunately, for agriculture, food and water are two of the things that create the most fear and irrational behavior in people. When those two things break, that is everybody's greatest fear. We can live with a lot of shelters, water, and food and we need those common things to really feel comfortable at home. There's a narrative in this country that those things are all at risk and it amps everybody's intensity up about it. 

Colter DeVries 1:06:24

So you're saying waves come in and waves go out. They come in and break, then first-world problems aren't such a big issue when you're dealing with $5 gas.

Rich Bradbury 1:06:33


Colter DeVries 1:06:36

I mean, that's some good optimism. So let's not leave people with this episode unhappy. Let's end on a good note. I would say that the positive thing is rural American producers and all consumers have a stake in it, but producers have a share in it. Get a seat at the table. If ESG standards are being forced upon you, help write those ESG standards because if you're not writing the menu, you're on the menu. 

Rich Bradbury 1:07:13

I love that saying. You're the first one I heard–. I think that the important thing is we got a little bit off the track at the end. There are systems like we talked about company natural beef and desert mountain beef. There is stuff out there that works for both the consumer and the rancher or the farmer. We just need to look at those a little bit more and see that we can create those mutually beneficial relationships. All these things are possible and there are a lot of forces that are against that. But things that we can presume and preserve as independent agriculture, nobody wants to see the– And having been in Russia, I see what the corporate large organization agriculture does, and it's devastating. Nobody that eats food in this country wants to see that. I think when everybody takes a deep breath and looks back like we talked about, we have a great food system. It gets mooed a lot, but it's probably the most and one of the best in the world. We have a lot to build on and we can do a lot better. We can take those consumers where they want to be, but it has to come from the conversation and has to start from a level of mutual respect rather than demonization.

Colter DeVries 1:08:33

Yeah. Now I'm gonna take this back to ranch investing. For the listeners out there who are like Okay Randy Weaver and David Care, you guys are hardcore and blow hard out fighting the government, I’ll wrap it up with how this relates to ranch investing. I would say if you want a lot of different buyers for your ranch, you don't want just Syngenta Cargill, JBS, Bill Gates, T Craft, and Hancock Financial competing to buy your ranch. You want thousands of different people wanting to buy your callow or your ranch. That's why it's better to keep it a large market with lots of independence. 

Rich Bradbury 1:09:21

What I've seen in my real estate practice is I have not had a traditional rancher buy any of the properties that I've sold. One of them is very much an advocate of conservation and the high desert sort of landscapes did not have the cattle by any means, so he dials it down. Another guy sees a better food system. He wants to be part of creating that, and he started from scratch. I'm on the phone with him a lot. He's committed and wants to see this. What I see positive is that that kind of investor or rancher that comes in and learns those things, and as long as they're contributing in the community, the diversification and the innovation that they bring from looking at that perspective from ranching at a different perspective, is immensely valuable. And I think we are going through the largest wealth transfer in the history of the world. We are gonna see a lot more of these type of buyers. It's very important that we make them welcome, help educate them along the way and do the best that we can to transition them into the communities that they're gonna join because I really think they're going to bring a lot of value and make a lot of positive changes in rural communities across the west and United States.

Colter DeVries 1:10:55

I'm gonna shift down right there because you just opened up a can of worms for the next episode. That is the topic, Rich Bradberry. What is your real estate company called? 

Rich Bradbury 1:11:05

High Country Real Estate, Lakeview, Oregon. 

Colter DeVries 1:11:07

How do people get ahold of you?

Rich Bradbury 1:11:09

We have a Facebook page. I'm active on LinkedIn and you can get to me through either of those.

Colter DeVries 1:11:17

One of the owners of the historic MC Ranch. Thanks for coming on, Rich. When we come back for the next episode, part 3 of Rich Bradbury, we're gonna talk about what land ownership looks like in the West and how your market is similar and different to my markets. That'll be exciting. You seem very inclusive and welcoming of some of these changes that we're experiencing. Thanks for coming on, Rich.


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