By Mary Beth Stephens, Correspondent
All Howard Buffett wanted to do was drive a CAT loader. Just out of college, he approached a contractor in Omaha, Neb., to ask if he would hire him. Buffett was told he couldn’t get along with the guys since he was, “born with a silver spoon in his mouth.” A second contractor turned him down, even when Buffett offered to work for free. “That wouldn’t go over well with the guys who work for me,” the contractor told him.
Not to be deterred in his quest, “I bought myself a 955K front end loader thinking, ‘I’ll just go into business for myself,’” Buffett said. “I knew how to drive an end loader, but wasn't sure how to start this one since they're all a little different.” Once he learned how to start it, “I asked another contractor for jobs he thought were too small for him to do.” Buffett worked a few of these, but didn’t have a trailer to haul his end loader around and had to wait for rides to the job sites.
When this didn’t work well, Buffett asked someone to build a trailer for him. Six months later, “I didn’t have my trailer, and I’d given him a $4,000 down payment. When I asked to get the money back, he said he didn’t have it.”
Rather than returning his down payment, the man gave Buffett a non-working Minneapolis Moline tractor, worth only about $700. Parts to get the tractor going would cost another $3,500. “I didn’t have my down payment back, and I didn’t want to spend that kind of money on this tractor, so I asked a neighbor of mine who had similar tractors if he could help me.” Buffett’s neighbor fixed it by making it into a straight five speed, rather than having an ample torque. “I offered to pay him, but he wouldn’t take any money, so I made sure to grade his gravel drive every once in a while.”
His tenacity, gumption, willingness to work from the ground up (literally and figuratively), and his inquisitiveness are a testament to both his parents and the lessons he learned from them. Buffett appears to work from three distinctive, but overlapping and intertwined ideals: an insatiable desire for edification, business acumen, and a determination to help others.
One day this neighbor asked if Buffett could help with some of the discing on his farm. Even though Buffett knew nothing about farming, and didn’t know how to drive the tractor, he said. “Just tell him what to do. So I got on it and started discing, and I think, ‘this is more fun.’ If I had a real piece of equipment this would be more fun than digging basements.”
Buffett helped more and more on the farm. One time, “I was discing near dusk on a terraced part of the farm but I didn’t want to quit when it started to get dark. I finished one area and moved to the next, and I thought it looked a little different.” Soon, a pickup truck drove up behind him. It was the farmer’s son. “The ground looked different because I was discing a terrace the farmer had just planted,” Buffett said. Between the two of them, they replanted the area, but the son was sure his dad found out.
Although it was an inauspicious beginning, Buffett said, “I learned some valuable business lessons” – a contract is a good thing in certain cases; you often get what you pay for and nothing more, and there are many honest, decent, hard working people everywhere who will give you a hand.
After the discing incident, Buffett decided the safest, most practical, and useful way to learn how to be a farmer was to farm on his own. “I cash rented a few hundred acres and learned as I went,” he said, making many mistakes along the way, but always endeavoring to learn from those mistakes, and move forward.
About 19 years ago, his expanding farming experience led him to central Illinois where he lives today with his wife and five children. He takes a great deal of pride in being a farmer. “I farm 1,240 acres in Shelby and Christian Counties with the help of my wife and a man I’ve known for years, Bob Schutt. He takes vacation time to come help in the spring and fall,” Buffett said.
‘Biggest bang for the buck’
In 2009, Buffett’s foundation, the Howard G. Buffett Foundation (HGBF), purchased about 1,300 acres of farm ground in Macon, Shelby, and Christian counties. The foundation purchased this ground to continue Buffett’s quest for knowledge and understanding. He wanted to know if central Illinois farmers are getting “the biggest bang for their buck” when it comes to farming inputs, primarily seed, fertilizer, and farming methods (which cost time and money in fuel and equipment) and if there are more environmentally sustainable alternatives.
“What we are doing may have significant implications for cost/benefit and environmental impact of GMO and non-GMO corn and pesticides,” Buffett said. The primary goal is to determine what is not only the best economic combination of fertilizer, seed, and practices, but which is also the best environmental combination.
Buffett firmly believes farmers will have to make choices in the future to farm both economically and sustainably. His efforts on these central Illinois farms is directed toward what he believes are not mutually exclusive goals. “We have to make sustainability economically viable for the larger scale farmer.”
Because he believes in a hands-on approach to understanding, HGBF has awarded Southern Illinois University – Carbondale a $1.7 million grant to study how herbicides, pesticides, fertilizer, cover crops and tilling methods affect the yield of both GMO and non-GMO corn, and the environment. From his descriptions of the research fields, Buffett is well versed in what is occurring and intimately involved. He didn’t just give them the money and walk away; he wants to be and is involved with their project planning and implementation.
Buffett’s father preached patience and because Buffett realizes it takes time to fully understand a situation, the grant runs for six years. He anticipates donating additional funds to support this research another 13 years, until 2029.
Usually research acreage is on the order of less than an acre, often one-quarter to one-half acre for a particular project. Buffett’s experimental acreage ranges from eight to 80 acres for each project. He has the land to dedicate and he wants to determine if the projects work at the scales central Illinois farmers work with. “If someone told me they found out this or that on a one-quarter or one-half acre field, I’d walk out. It’s not useful information,” Buffett said.
Several fields are being used to determine the effectiveness of different cover crops. The cover crops include ryegrass, radish, turnips, cereal rye, and sweet clover. They are not harvested for any commercial value, but rather are killed to return nutrients to the soils that have been removed by the previous commercial grain crop. The cover crops also control erosion between commercial grain plantings, reduce soil compaction (which allows better water infiltration), and control weed growth.
Usually, applying nitrogen-containing fertilizer would provide soil nutrients.
Buffett and SIU-C are using cover crops on a total of about 80 acres, divided into 8-acre plots. “I hope we can prove how to use cover crops at scale to reduce the use of synthetic inputs and to build soil health,” Buffett said. In the FarmFutures.com article, Buffett said, “Nitrogen prices will determine the short term goals, but longer term, we need to learn how to do things differently, so when volatility and expenses are higher, we’ve established a plan that allows us to go in and produce in a different way.”
On other fields Buffett and the researchers are planting Roundup Ready corn and BT (triple stack) corn using different rates of fertilizer application (none, half rate, and full rate) for several reasons. “I like to have my own data and information. We don’t want to know what the Ag companies have to say,” Buffett explained. The Ag companies don’t have to release information considered proprietary, and Buffett prefers his own data collection and analysis anyway. “We can analyze the effects of the corn’s characteristics and it’s ability to maintain yield without the fertilizer and with variable amounts of fertilizer.” The researchers will monitor ground and surface water for pesticide residue from the corn and fertilizer runoff to determine environmental effects.
Buffett is planting one 10-acre area corn on corn for “as long as it takes,” to better understand and demonstrate what will happen in African farm fields if African farmers use their farming methods with our seeds and not fertilizer or pesticides. Many plant the same crop every year and don’t have access to the necessary fertilizer and weed control that American seeds require. “I would rather not mine ground, and I’d rather mine 10 acres than 40, but we need to do this at scale, and we want to use the implements we have, so that we’re actually farming it.” He feels it’s necessary to prove the “green revolution” will not work in Africa. The end result will be a useless piece of property for commercial seed in about three years.
The point he is trying to make is you cannot simply export our “race horse” seeds with their biotechnology components that require fertilizer and herbicide to countries with no infrastructure to support their growth, such as many countries in sub-Saharan Africa.
Many, many farmers in Africa are small landholders or perhaps sharecroppers. It is analogous to the situation in the United States in the 1920s and early ’30s. Farmers eke out a living on sub-standard soil, planting the same crop year after year, without replenishing the nutrients because they can’t – they either aren’t available or are too costly. Eventually, often within just a few years, the ground can’t support the crop anymore. The farmer abandons the ground and strips vegetation on another, seemingly better, virgin plot of land. He or she then repeats the cycle. Millions of acres of rain forest and other biologically diverse areas in Africa have been and continue to be permanently ruined in this manner.
Buffett wants to change this. “I don’t think my way is the only way, but I believe that, since, I’m a farmer, I know what farming requires. We can collect a lot of data on how various inputs, tilling methods and agricultural practices affect yield.” He believes the data can be a very convincing argument and they can change the conversation.
And what is the argument? Everything is different in Africa and other developing nations from how we operate in the United States. We, (the U.S., Non-government organizations (NGOs) and other not-for profits) cannot simply transplant our seeds and agricultural practices to countries with no supply infrastructure for farmers, no financing operations, a primarily manual farm culture, different soils, different cultures, weather, and a dearth of education in many areas and expect them to work in the long term. Instead, the conversation needs to be about what would work for the people who live there, considering their environmental situation, their educational level, access to financing and markets. “You do what works for where you are,” Buffett said.
Philanthropic interests
How do you implement that particular conversation? That’s where Buffett and his foundation are hoping to make significant strides in the coming years.
The Howard G. Buffett Foundation is a private foundation. They do not accept solicitations. It was established in 1999. According to its 2009 annual report, the foundation’s primary mission is to “improve the standard of living and quality of life for the world’s most impoverished and marginalized populations… Our highest priorities are agricultural resource development for smallholder and subsistence farmers and clean water delivery to vulnerable communities in Africa and Central America.”
Howard Buffett was on a safari taking photos of cheetahs and wildebeests from an airplane. It was from there that he saw the “slash and burn” technique of farm ground clearing. In their constant quest for good farmland, the farmers cleared the forested areas and grew crops to hopefully provide a subsistence existence for them and their families. But this ground isn’t like Central Illinois’ rich, black soil. This soil is often sandy, or has little topsoil. The vegetation, including the flowering plants and trees has acquired its nutrients primarily from the rotting plants and fruits on the top of the ground. Removing these deprives the area with its nutrients. The grain or other crop further degrades the ground. Within just a few years, the ground is non-productive and the farmer slashes and burns more forest.
As in his personal farming, Buffett’s philanthropic interests are varied, and he invests an enormous amount of time, intellect, and energy to understand the needs and what his foundation can provide to best address them. But, “We have limited resources considering the breadth and depth of some of the problems we address,” Buffett lamented.
Like his efforts to learn how to drive an end loader, Buffett started with something he felt he could handle – projects. “It was the only thing I felt comfortable with, that I knew,” he said. From 2002 through 2005, the HGBF contributed between half and 87 percent of its funds to conservation projects. Beginning in 2006, that amount was reduced to 14 percent as Buffett moved toward different areas of need and interest. He also began rethinking his foundation’s strategies for helping the world’s poor.
From the Howard G. Buffett Foundation 2006 Annual Report: In Mozambique, HGBF funded a project designed by CARE (a not-for profit fighting global hunger) to improve crop yields and thus the income of smallholder farmers by improving soil fertility and water management systems. The project involved farmer education in no-tilling practices, soil testing and agricultural extension services to assist approximately 27,000 farmers over a three-year period.
In the Democratic Republic of Congo (DRC), Rwanda, and Uganda, the foundation funded a program through CARE and the International Gorilla Conservation Program to implement a five-year project to increase the livelihood of participants based “on sustainable us of natural resources and to improve the governance of those resources. Among other things, the project provided micro-financing and income generating activities based on sustainable principles, community involvement in the responsibilities of and profits from responsible resource management.
One of Buffett’s first conservation projects was preservation of cheetah habitat in South Africa. He has recently sold a 14,000-acre farm in South Africa that supported numerous cheetahs. Four of those cheetahs are being moved to a new 9,200–acre farm in South Africa.
This new farm contains numerous research projects. CIMMYT (International Maize and Wheat Improvement Center) is “reproducing foundation seeds to be available to small seed dealers in Sub-Saharan Africa. We provide the land, irrigation equipment, housing, management, and funding,” Buffett explained. One problem Sub-Saharan African farmers have is finding seeds appropriate to their ground and farming practices.
The African governments don’t have the necessary resources to do this kind of research and private American companies don’t want to give a product away. They would need to charge more for the resulting seeds than these farmers can afford.
Pennsylvania State University is conducting research at the South African farm on root uptake of nutrients in beans and corn. The Rodale Institute is “conducting research on intercropping and application of organic techniques such as cover crops. They are also establishing farmer schools,” to help “identify challenges and solutions for pest, disease, and weed management.” (HGBF Annual report, 2006)
ECHO (Educational Concerns for Hunger Organization) is researching grazing rotations, agro-forestry, and cover crops. The Donald Danforth Plant Science Center is “working to identify collaborating partners to conduct research on disease, pest resistance and better farming methods for cowpeas, ground nuts, sorghum, cassava and other regional crops,” Buffett explained.
The University of Missouri is working on improving rice production by using center pivot irrigation rather than flood irrigation. “Using a center pivot irrigation system can reduce water needs extensively, even up to 90 percent,” Buffett said.
“This is an over-investment, because we have all these different research projects going on. No normal person would do what we are doing,” Buffett offered in explanation of the monies invested in buildings and other infrastructure at the South African farm.
When asked why he allocates funding for all these research projects (and these aren’t the only ones), he answered: “We can say we did [this research] and here is the information we found. You have to be careful that you don’t lecture people about the way to do things. But with the data, at least we can show what worked and what didn’t. We are not trying to tell anyone in Africa what to do. What we are trying to do is say, ‘Here is what we have done, look at it, take it or leave it.’”
Buffett’s methodology for his foundation is the same as for his own farm: “The more information I have, the better I’ll be financially and environmentally.” It also reflects his constant need to learn more and do more.
And Buffett even does more with less on his staff. “I only have eight employees on the foundation,” he said. “I get done what I get done by hiring good staff and delegating.” He used to review and approve the projects budgets himself, but as his foundation has changed he did hire another staff member.
Changing policy
Over the past year, through the foundation, Buffett is moving toward more policy oriented programs than traditional projects. Some projects are simply necessary, such as providing assistance, “in conflict areas, in those places you do the old-fashioned projects because you don’t have any options. There is no infrastructure, there is no money, and the government is not functioning.”
Over the last few years, Buffett has been asking himself if he and his foundation could do more, “We can help a great number of people and it might be a million people, who knows, but in the end, we go home. How much of what we leave behind continues? And sometimes you create a dependency,” Buffett explained about changing how his foundation functions.
“If you take a project and say we are going to give you seed and fertilizer for the next three years, and then we are going home, what happens when we do go home?” Buffett said. “If there is no strategy on how to convert them [recipients] to functioning independently or how they can afford these things after we stop giving them to them, then you have done damage.”
He also wants to make sure the answer to the question: “What will work?” is an answer that corresponds to the population in need. Buffett expounded further, “There is a huge disconnect in the debate. If your goal is to help female farmers that live on 50 cents a day, and then you look at the solutions: infrastructure development, better markets, financing; none of that applies to this woman. She lives a five-hour walk from a market; she doesn’t have any surplus food to sell. We’re collecting information about seven different ways using seven different organizations and we hope to put together a document that forces people to talk about it differently.”
For the female farmer who must walk five hours to a market, and doesn’t have any surplus food to sell anyway, perhaps a better solution is to provide her with the means to grow more food – better seeds for her conditions, sustainable irrigation, better farming techniques, et cetera. But if the market is five hours away, a better marketing solution may be needed too. Buffett is doing research “seven different ways with seven different organizations” to see if that is an answer, and/or if there is another one.
A few days after our interview, Buffett was embarking on a brand new project. He was visibly excited about the opportunity it presented to coalesce his new thinking. “We are not going to give anything to anyone,” he said. While that sounds a bit hard hearted, he explained. The United Nations World Food Programme (WFP) has partnered with HGBF in the past on a program called Purchase for Progress. P4P creates a market for smallholder farmers to sell excess crop.
This new program in Central America formalizes the marketing partly by allowing the WFP to purchase small quantities from farmers, (one ton of food rather than a minimum of 100 tons). This allows significantly more small farmers to have a market for their products where before it might go to waste. These farmers are usually farming less than 10 acres, perhaps even as few as 3 or 4. The farmers being brought into the program, “may have excess food they can sell one out of every two years, or perhaps two out of three. It won’t really help the poorest of the poor farmers because they don’t have excess food to sell,” Buffett said.
Funding will be put toward educating the farmers, “teaching them about contracts, quality issues, delivery issues, actual financial training,” Buffett explained. “You would not believe what we assume about the people we are trying to help,” Buffett continued. “About three or four years ago, I walked into this little village in Liberia and they had this tarp set up and they had about 40 people crammed underneath it. They had a chalkboard and they were teaching them how to add. It turns out, we were trying to help these people sell their products, but they don’t understand what they are paying in the market and they don’t understand what their produce is worth when they go to sell it in the market.”
Financing will be provided through micro-loan organizations. The governments of Nicaragua, El Salvador, and Guatemala are also on board, providing loan guarantees and some loans, which is key. “If you don’t get the governments participating, it can kill the project long term,” Buffett said.
Buffett hopes this new, five-year project will work for 70 percent of the farmers involved. While the WFP may not be around forever, “that doesn’t matter. Once they have sold to the WFP for a couple of years, they may get a price from Grupo Gruma [Gruma Group, the largest manufacturer of corn flour and tortillas in the world] or somebody else and they can go sell it to them. They don’t’ have to sell it to the WFP,” Buffett enthusiastically explained.
Mary Beth Stephens is a freelance writer from Springfield.
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