10 keys to a profitable transition to regenerative agriculture
By Kim Deans
Concerns about farm profitability can be a barrier for those contemplating the transition to a more resilient, regenerative farming system. This is understandable as there are plenty of challenges to navigate in agriculture beyond our control as land managers without creating more ourselves. Grow your confidence for taking the next steps by addressing these key components of a profitable transition to a regenerative system.
1. Strategy
The lack of an appropriate strategy designed for our individual context is a frequent contributor to financial pressures arising in the quest to improving soil health and transitioning to a regenerative system. Often people who become inspired by regenerative agriculture initially take what I like to call a “scattergun” approach, trying lots of practices and products randomly with no clear strategy. It is not the practice of product that makes you “regenerative” it is the outcome you achieve.
If you have tried lots of regenerative practices but you are not achieving the outcomes you know are possible then it’s time to get strategic. Developing an appropriate strategy that fits your unique context is vital. There is no one size fits all approach in regenerative agriculture. We are required to leave behind the formulas and certainty provided in the industrial farming model and focus on innovating to adapt principles to our unique context instead.
2. Build the foundations first
A successful regenerative strategy is built on a solid foundation driven by effectively harnessing the “free” resources supplied to us by ecosystem services. The critical piece is how effectively we capture solar energy through photosynthesizing plants to improve soil carbon. Soil carbon is the basis of improving soil health including aeration, water, biological health and mineral cycling. Harnessing these foundations leads to improved rainfall use efficiency, profitability and resilience to climate variability.
Grazing management and maintaining living ground cover are the practices that build these foundations upon which the whole system is rebuilt. Without these you are merely exchanging a high input chemical treadmill for a high input biological system. A common trap for new recruits is to stay bogged in the industrial farming mindset of exchanging one input for another or looking for nicer ways to kill things. Regeneration is only possible when we reconnect with the ecosystem processes that drive farming systems upwards in health.
3. Prioritise financial management
Financial management is a key aspect of every successful business and it is crucial when navigating a process of change, making this a vital component of a profitable regenerative strategy . To be truly regenerative our business must be financially profitable. Proactive financial management involves staying in control of your cash flow, making informed decisions with the best information available at the time, culling unprofitable enterprises and effectively communicating with lenders.
4. Prioritise people care
Our people are our most valuable assets in our business. Our businesses and landscapes are a reflection of the state of mind, decisions and actions of their people. Navigating new territory in the transition to a regenerative system relies on having people fit for the task. People burdened by high stress loads, exhaustion, burnout, mental health issues, physical health issues or strained relationships are not going to have the essential mental band width or energy to think creatively and innovate. We are not regenerative if we are running down or exploiting our human resources, including ourselves. This means it is vital to take regular holidays, maintain physical health and fitness and to seek professional help early when relationship and personal issues arise.
5. Monitoring
Imagine setting off on a journey in your car without a fuel gauge, speedo or dash board. Our strategy is our road map or GPS for the regenerative journey and backing this up with regular monitoring provides the fuel gauge, speedo & dash board systems for picking up the vital signs of our business before it crashes on the journey. Monitoring is always time well spent, providing opportunities for informed decisions, reduced risks, increased profit, improved confidence and acting as an early warning system for unintended consequences arising in your land management system.
6. Avoid silver bullets
There are no short cuts to this process. Success on this journey requires us to shift away from the industrial farming mindset of looking for the answer in a product, prescription or expert. Regenerative agriculture is a journey of reinvention, innovation and connection. It involves more than simply exchanging one input for another or finding nicer ways to do the same things and expecting different results. Get your management and mindset on a regenerative track and design a strategy that is appropriate for your context before you spend time and money on inputs. Regenerative outcomes are a result of your management, decisions, actions and observation.
7. Take a wholistic view of profit
Working for 12 years as a Rural Financial Counsellor with hundreds of businesses showed me how the most resilient farm businesses were all proactive managers of their financial, human and their natural resources. Neglecting to manage in one or more of these key areas was the catalyst for reduced resilience and declining viability and was linked to all the farm exits that I supported farming families through in this role.
It is essential to prioritise management of our financial and human capital alongside the focus on restoring natural capital. What I find most exciting is that how we manage our financial, human and natural capital are all within our control.
When we put all of our focus on just one of these three key areas we can inadvertently sacrifice the others and end up paying the price later. Farm benchmarking analysis focused on financial resources alone fails to adequately capture the human and natural capital components of farm profitability. You cannot be truly profitable if you are running down these resource bases on which your production system depends. There are many forms of wealth that are inherently more valuable than money and focusing on their intrinsic value as part of the whole system encourages us to build capital in all domains.
“Only when the last tree has been cut down, the last fish been caught, and the last stream poisoned, will we realize we cannot eat money.” Cree Indian philosophy
8. Stay in your own lane
We have all heard the rumours about regenerative agriculture not being profitable and stories about the farmers who didn’t follow the crowd who have gone broke after trying regenerative farming practices. Our experiences have shown us a very different perspective where farmers reduce costs, improve profit and fall in love with farming again.
When we take a holistic view of agricultural systems it becomes obvious how the outcomes of regenerative practices including having a healthier soil, reducing chemical inputs and building resilience to climate variability are essential components of creating a profitable business. In addition to these financial benefits, improved ecosystem health and the quality of life & wellbeing of the people in the business are more valuable than money can buy.
The only certainty in life is change and in business those that survive are those that are most adaptable to change. Change is always uncomfortable and many will resist it, holding on strongly to the status quo, even in the face of the extraordinary difficulties that arise when we become invested in keeping things the same. Focus on where you want to be and who you have to become for that to become a reality. Don’t pay attention to advice or doubts from those who haven’t been where you want to go.
9. Challenge your assumptions
I have had farmers say to me, “that work you are doing in regenerative agriculture is great BUT it’s got to pay.” I have also seen farmers embark on this journey with the unfounded assumption they will lose money! This is not a good head space to be navigating a desired change from and these assumptions can set us up to fail before we even begin.
“Whether you think you can, or you think you can’t, you’re right.” – Henry Ford
Our assumptions represent what we believe to be true and ways we have learned to see the world with no evidence that shows they are correct. Our assumptions influence our decisions and can keep us stuck in ways of doing things that are no longer working. Questioning our assumptions can feel threatening as our beliefs make up key components of our identity. We can tend to hold on to these beliefs as though they are a life vest on a sinking ship and we rarely stop to consider whether our beliefs could be the sinking ship…
Challenge your assumptions, things are not always as they seem. Don’t cling to a belief just because you spent a long time believing it.
10. Surround yourself with a supportive team
We are the sum of the people we surround ourselves with. Transitioning to regenerative agriculture is a journey that is made easier and more enjoyable when we surround ourselves with people we admire, who inspire us and challenge us to become better versions of ourselves. Being around people with shared ambitions creates opportunities for learning together and from each other.
A supportive team within our business itself is also essential. When you have an effective team, the whole is greater than the sum of its parts. This requires trust, a diverse mix of people, strong leadership and excellent communication. Crops and livestock are not the only things that we grow in a regenerative system our people grow too. If relationships within your business and/or family become strained due to the regenerative transition you wish to make then seek professional help either for yourself or as a group/couple early. A problem ignored only grows bigger until we have no choice but to deal with it.
Accessing support from outside of your business in the form of coaching, training and attending field days will bring in fresh perspectives, information and new opportunities. Regenerative businesses celebrate diversity and operate on reciprocity, rather than aiming for sameness and operating on energy draining, co-dependent relationships. Don’t waste your time trying to convince people or win their approval for your regenerative vision. When you surround yourself with a community of like-minded people it becomes easier to focus on being the change you wish to see and letting your actions and results speak for themselves.
A successful and profitable transition to regenerative agriculture is realistic and achievable with all of these key components within your control as a land manager. If your business could benefit from our unique blend of skills encompassing human, financial and natural resources we are able to work with you on all of these aspects. Get in touch with us to learn more about how our programs and workshops can support you to profitably transition to a regenerative system.