SAN FRANCISCO — The demand for sustainably produced crops has increased sharply in recent years, with farmers and the world’s largest grain companies responding by investing heavily in sustainable and renewable agricultural practices.

The latest development on this front is a joint venture between the Farmers Business Network (FBN) and agribusiness giant ADM called Gradable. Gradable is a technology platform, introduced in 2020, that enables farmers and buyers to pursue and derive value from grain produced using sustainable and regenerative agriculture.

To meet the burgeoning demand for grain produced in this environmentally friendly method, Gradable will expand across ADM’s hundreds of facilities spanning the United States and Canada, increase the number of commercial partners and countries served, and have capabilities to help the supply chain meet global demand needs for more sustainable food, feed, fuel and industrial products.

Steele Lorenz, recently appointed as chief executive officer of Gradable, has spent the past 14 years promoting sustainable and regenerative agricultural practices. In 2010, he founded MyRain, which was tasked with solving water security problems for India’s small-plot farmers by introducing drip irrigations systems. Eight years later, Lorenz was hired as head of sustainable business for FBN, and in 2023 was promoted to head of strategy and business operations for the San Francisco, California, US-based company.

Lorenz spoke with World Grain, a sister publication of Milling & Baking News, about how the joint venture, announced Aug. 19, can benefit farmers, buyers and end users.

WG: Explain how the Gradable technology platform works?

Lorenz: We started Gradable in 2020. It was based on the emergence of sustainability premium markets and trying to understand how that may impact the entire grain marketing experience for farmers and grain buyers. If you look at some of the requirements for sustainability scoring, growers were already collecting many of these data points on the farm. Things that they were looking to analyze with FBN already, we were starting to see if you plugged those into environment models. The Gradable platform was started to provide access to premium markets for growers at the scale that grain markets exist today. Prior to that, there were lots of wonderful pilot programs across the industry, but we kept seeing the problem after getting to 10,000 or 20,000 acres. The question was: how do you buy these grains at scale?  That’s what we started Gradable to do. We’ve seen substantial growth over the last four years. We now have 20,000 growers participating in the platform who are facilitating $30 million in premiums. We really see that as just the beginning.

WG: How is this joint venture mutually beneficial for the two companies?

Lorenz: We’re getting ready to scale. How do we meet the demands of this market? Where are we going in terms of the number of growers participating in North America and globally in these programs? With all this growing interest, the joint venture is prepared to meet that demand. It’s good to connect to ADM and leverage their experience. We agreed with ADM that this platform needs to be independent — and prepared to be able to serve the entire grain industry. To be able to have a platform that meets the moment, we needed to start something separate and new. It still has all the great features and functionalities that FBN developed in Gradable with a real commitment to data, privacy, and data transparency for growers. They know exactly where their data is going. The commitment to the industry-leading technology that FBN is known for in the industry remains, but now we have the ability to work with partners and processors that may otherwise compete with. Now we’ll be able to scale to serve a global audience.

WG: How will the JV impact your current customers?

Lorenz: It is very much business as usual from that standpoint. Our customers continue to receive the same services. Gradable will continue to provide premium opportunities in the FBN platform as well. We will be launching a new user interface for farmers and buyers on the Gradable platform soon. The existing relationships are unchanged, but we’ll be able to be in a position to add more customers to the platform and develop our strategy and approach as a standalone company.

WG: What are some of the factors driving this push in recent years for sustainable and regenerative agricultural practices?

Lorenz: It’s been a wild ride. At the end of day, it’s important to understand that this is driven by end consumers. Whether it’s a voluntary commitment that a large consumer packaged goods company makes to their stakeholders and customers on transforming their supply chains, or whether it’s voters supporting policies, in the end consumers drive this trend. A good example of that is what we’re seeing in sustainable aviation fuel and tax credits for low carbon biofuels. All of this is driven by the end customer, and we only see that expanding. Certainly, there are many processors and companies responding to these scenarios, but it’s not just driven by them. It’s preparing for this new market demand and a change in the ecosystem in that way.

WG: Are there difficulties in convincing farmers to adopt these practices as opposed to the traditional methods? What are the platform’s biggest selling points for farmers?

Lorenz: We always need to remember that farmers have always been stewards of their land. Nobody is more tied to the long-term performance of the land than the person working it on a daily basis. Often, they’ve grown up there and the farm has been in their family for generations. It’s important for us to remember that. Any challenges or problems in adopting practices or technologies are really based on two things. One, does it do what it’s supposed to do? Is it beneficial for the farmer? There’s a lot of practices or things we think might be beneficial, but it ends up being beneficial for a certain type of farmer or a certain type of field. We need be very careful not to paint all these practices with broad brush and say it will work for your operations all the time. That’s one thing. The other is does it make economic sense? Farming is a passion and a calling, but it’s also a business. We cannot forget that if the practice costs more money and does not directly result in an improved ROI in the near term, that is a practice that will always require a premium. And we’ve seen premium markets be established at scale, much like organics. I think regenerative agriculture needs be treated in the same light. This platform fundamentally is the infrastructure that supports that, to be able to provide the accounting, to be able to provide validation mechanisms so growers can consistently prove that they are adhering to these practices and achieving outcomes.

WG: Are there plans to expand this joint venture outside of North America?

Lorenz: Today, we run North American programs and are very active in the United States and Canada. Part of the desire of this joint venture is to become a platform that can facilitate global clients. Today, what that means is we are supporting export markets from North America. But we are also making sure we have the capabilities to bring farmers on and support buyers in other countries, and that is going to on the roadmap here very soon.

WG: What steps does Gradable take to ensure data security?

Lorenz: Gradable has made a continued commitment to data security and transparency. Any time there is a change in ownership or a transition in a business, that can be a concern. What Gradable is known for is security and privacy, and knowing as a farmer where the data’s going and as a buyer making sure that what you’re doing continues to be your information. We are continuing all those practices. For farmers, it’s critical that you know where the data is going, knowing it’s being used explicitly to participate in premium programs, and which buyers are participating. That is reconfirmed every time you participate in a premium contract. This is to assuage any concerns that might come up. Gradable could not exist without data transparency and certainty and what participation means for growers.

WG: How did your career path lead you to this current position?

Lorenz: I started working on FBN’s sustainability business in 2018; I’ve been working on that side of the business for the past six years. It’s been wonderful to see the growth and emergence of this platform. Much of that is because the team that Gradable has assembled is fantastic. It’s also been the rise of the industry demand that’s driving this. I’d love to be fully responsible for the acceleration of this movement, but it is far larger than that. Growers are looking for these solutions and buyers are consistently looking to purchase and develop their programs. And of course, end markets and policies are a major driver.