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CIG Creates Market Opportunity for Small Grains in Midwest

By Lucas Isakowitz, NRCS Presidential Management Fellow

A Conservation Innovation Grant (CIG) program is helping midwestern farmers tackle water quality, soil health and greenhouse gas issues. A coalition including Practical Farmers of Iowa (PFI) and Sustainable Food Lab is using CIG funding to help farmers plant small grains and cover crops into the traditional soy and corn rotation.

Scott Wedemeier shows farmers his summer cover crop seed mix, which he seeds after small grain harvest. Farmers gathered on Scott's farm to hear about organic small grain production on July 25, 2021


Integrating small grains and cover crops into a corn and soy rotation can help break up pest cycles (meaning less pesticide use), while increasing the amount of carbon and nitrogen stored in the soil, all of which ultimately improve soil health and water quality. Several CIG-funded pilot programs helped demonstrate how cost-share and technical assistance could facilitate reintroducing such crops into traditional rotations. And now PFI and partners are looking to address the lack of a downstream market by working with 11 supply chain partners, including Cargill, General Mills, McDonalds, Oatly and PepsiCo.

“The only way to get a landscape that is less dependent on high-input agriculture is to figure out how we can incentivize crop diversification,” explains Elizabeth Reaves, Senior Program Director for Agriculture and the Environment at Sustainable Food Lab. “Thanks to these grants, we’ve been able to leverage the cost-share and technical assistance that is needed and engage companies in the supply chain on the value of creating a market for sustainable grains.”

One such company is Oatly, a Swedish-based company that produces plant-based dairy alternatives. “Oatly’s mission is to switch to a food system that is better for the planet and human health,” says Sara Fletcher, Communications and Public Affairs Director at Oatly, North America. “And so, we are thinking about how we can use our purchase power and supply chains to help accomplish this goal.” When Oatly began operating in the U.S., they committed to producing all their products for this market in North America and from North American oats. But since there are few large oat producers in the U.S., the company sources most of their oats for their U.S. manufacturing facilities from Canada. Oatly learned of PFI’s efforts and is now participating to see if midwestern farmers can be incentivized to grow oats. For the past three years, Oatly has worked successfully with a small but growing number of midwestern farmers.

In addition to linking farmers to food producers, PFI is also building out the market for oats used in animal feed. “Food markets alone are not going to drive markets for small grains,” says Reaves. “There needs to be simultaneous development of food, feed and cover crop seed markets to overcome the current reality and that requires linking corporate commitment to reduce emissions and increase soil building row crop systems to crop diversification.”

In 2020, the CIG-funded program enrolled over 120 farmers, planting almost 12,000 acres of small grains in the Midwest. PFI is also working with farmers to help them apply cover crops in the fall with a similar cost-share program. Over 500 farmers accounting for almost 200,000 acres enrolled in the fall cover-crop cost-share program in 2020. “Our cost share programs help reduce the risk of farmers adopting new practices and our peer network allows them to learn from each other along the way,” says Lydia English, Strategic Initiatives Coordinator for PFI. “We're excited to continue growing our work with supply chain partners and investing in farmers.”

Attendees gather in Alec Amundson's oat field during his Practical Farmers of Iowa field day on July 13, 2021. Alec grew oats for Oatly in 2021.


Andy Linder farms near Easton, Minnesota, and has been a cost-share participant since 2017. He says that adding a small-grain crop has helped him diversify his farm enterprises and improve his overall farm resiliency. “Adding a small grain to our rotation has allowed us to grow bigger and more diverse cover crops, and has made integrating grazing cattle possible,” Linder says. “With the rotation we’ve been able to change up chemical uses so we’re not continually overusing the same products.” A key takeaway from the CIG pilot projects is that having legumes as a cover crop in an extended rotation with a small grain can allow farmers to lower their off-farm nitrogen-fertilizer, which saves money and lowers emissions. “The biggest challenge for most people remains having a market for the crop we grow,” says Linder. “PFI is helping growers find those markets and bring back the possibility of expanding small-grain acres.”