Ken McCarty – Meeting High Standards in Dairy

The following is an edited transcript of the Ag Future podcast episode with Ken McCarty hosted by Tom Martin. Click below to hear the full audio or listen to the episode on Apple Podcasts or Spotify.

Tom:                          I'm Tom Martin, and joining me is Ken McCarty, a fourth-generation owner of McCarty Family Farms, located in northwest Kansas. The McCarty Dairy Farm has been in operation for more than a century. The farm is Non-GMO Project-verified and has an emphasis on environmental sustainability and animal welfare. Thanks for joining us, Ken.

 

Ken:                            Thank you, Tom.

 

Tom:                          And let's begin at the beginning, because it goes back a bit. When was McCarty Family Farms founded, and why dairy?

 

Ken:                            Well, to answer the question of “why dairy,” I'd have to travel back in time and ask my great-grandfather. But our family's journey in the dairy industry began in the early 1900s in northeastern Pennsylvania. Our family’s farm was started by my great-grandfather, Taylor McCarty. And my grandfather, Harold, took that farm over. And my dad and my mom moved about a mile up the road and built the dairy that my brothers and I were raised on. And in the early ’90s, they began to look for expansion opportunities that would afford for my brothers and I the opportunity to come back to the farm, if we so chose. And we looked — or, I should say, they looked — all throughout the United States and eventually settled here in northwest Kansas. We moved in 1999, and we began the McCarty Dairy that I work at today in April of 2000. And since then, we've been steadily growing. And today, we encompass four farms here in the West: three in Kansas, one in southwest Nebraska and a farm in partnership with another farming family in west-central Ohio.

 

Tom:                          Because it's going to inform just about everything else we're going to talk about, tell us about the decision to become certified as a B Corp.

 

Ken:                            Yeah. To become a B Corp was not a decision that we made lightly. And we had some great leadership and inspiration in our customer, Danone North America; they're the largest B Corp in the world. And through their guidance and, then, through their inspiration, we made the decision to head down the path of becoming a B Corp. We were already heavily involved in third-party verifications, whether it be through auditing our environmental practices or animal welfare practices or worker-care practices. We're well-versed in that type of mindset. And we truly valued and believed that the B Corp mindset, the B Corp mission, was a mission that was aligned with our core values. And as such, it just made sense to take that next step. Although that wasn't an easy step to achieve that, we thought it was the right one to make, and we have no regrets, looking back at it.

 

Tom:                          That aspect, of third-party verification, would seem to really keep you on your toes. And do you regard that as a good thing?

 

Ken:                            Oh, absolutely. Absolutely. You know, being accountable to a higher cause and being accountable to someone that I don't go to work with every day does nothing but improve our business, improve our farms, improve us as owners and managers of our business. It simply just makes us better, because it doesn't allow us to ever rest on our laurels.

 

Tom:                          What are some specific ways that you meet the standards that are called for in B Corp certification?

 

Ken:                            Some of the cornerstone principles that we have focused on within achieving the B Corp certification have really centered around environmental sustainability and worker care. So, with regards to environmental sustainability, our farms and our farming practices — as well as the practices that we employ on our dairy farms, our raw crop fields and on through to how we work with outside vendors — we work very hard at auditing all of those. We quantify all of those with a third-party group called Eco Practices that calculates, almost in real time, our environmental impact, from soil health to biodiversity to water conservation and water quality preservation to carbon sequestration to a mission analysis. We try to take a very full-circle view of environmental sustainability and encapsulate that into a publicly available, well-based-in-science report.

 

And then beyond that, when it comes to things like worker care, we work with Validus, a third-party auditing body, to, on an annual basis, review our employee practices — things like what our wage scale is, what our benefits packages are, do we have things like whistleblower policies and whistleblower systems available. Anything and everything that we do as it regards to taking care of our team members is audited by Validus. And that just lends itself to making the transition to a B Corp all that much easier, because we already are being audited. So, why not just take that next step?

 

Tom:                          Tell me a little bit more about your approach to carbon sequestration. What do you all do in that regard?

 

Ken:                            So, our first approach to the overall carbon cycle is to create less of it. But when it comes to sequestration, we work very closely not only with our customer, Danone North America, and with our third-party verifying body, Eco Practices, but we work with our local farming partners to roll out the practices of cover-cropping to try to implement things like minimum-till or no-till. Those types of infield practices that are actually pulling carbon from the air and putting it back into the soil are all the programs that we’re really trying to implement — not only on the acres that we control but the acres that we influence. And we're using our acres and our farming practices and our business model to try to inspire our farmer partners — and, hopefully, beyond our farmer partners, you know, to the farmers that are within the local communities that surround us or across the nation — to demonstrate that, “Hey, these types of practices are good business, and with the added benefit of they're good for the world as well.”

 

Tom:                          What drove the decision to go for a non-GMO certification, and how has that improved the quality of your operations? And I'm wondering, was it difficult to arrive at the decision to do that?

 

Ken:                            Well, that decision was really prompted by our customer, and it was a very daunting ask. I would say that the thought of it was more difficult and more scary than the application of it.

 

                                    What was interesting to us as we embarked on that journey — we had to do it pretty suddenly, and we had to shift gears for not only ourselves but for our farmer partners rather suddenly. And our farmer partners embraced the change. In fact, we've had former partners come to us and say, “I've been wanting to make this change for years. I just simply haven't had the market.” You know? So, there was that initial mental roadblock that we had to overcome to achieve that. But since then, the feedback that we've received from our farmer partners and from the data that we've collected off of our own acres has been nothing but encouraging. We’re showing greater economic returns. We’re showing equal or greater yields. And I think that the biggest testament to why this has been a positive change for our farms and our business is (that) our cows are more productive, and it appears our cows are healthier by being fed primarily non-GMO ingredients.

 

Tom:                          It sounds to me as though the market is becoming much more friendly to sustainability and the whole concept of what you are doing on your farm. Is that what you're finding?

 

Ken:                            Yeah, I think so. You know, I think that there's going to be a greater call from the consumer, a greater call from NGOs, a greater call from Mother Nature herself for businesses — and in particular, agriculture — to adopt more sustainable practices. And I know, myself, when I go to the grocery store or when I go to a coffee shop, for example, I do, now, pay more attention to the on-package business practices that are stated by these companies. And if I have the ability, I will inherently choose the more sustainable company.

 

Tom:                          If you don't mind, I have some very specific questions about what goes on at the McCarty Family Farm operation, and let's begin with water and how you optimize water efficiency and reuse. How do you do that?

 

Ken:                            Well, here in northwest Kansas, and in southwest Nebraska, water is a very serious issue. We sit atop the Ogallala Aquifer, which is a depleting groundwater source. And you know, it's pretty honest to say that the future of these communities and the future of this area and the future of our business depend on conserving that natural resource. So, what we try to do is we try to implement water conservation measures from the soil all the way through our production and supply chain, ultimately (all the way) to the cup of yogurt.

 

                                    Infield practices, such as cover crops through the application of manure solids (and) minimum-till, help us increase organic matter levels within that soil, which ultimately help us retain moisture within that soil. We also measure the amount of water that is required by the crop and the amount of water that we’re applying to the field through the use of soil moisture probes, where we can, almost (in) real time, watch the depletion rate or the restoration rate of the soil moisture levels in those fields. And we can be very, very specific in the amount of water that we apply.

 

                                    Moving beyond that, we have, on our farm in Rexford, Kansas, an on-farm evaporative condensing plant that allows us to not only reduce the freight of finished goods from our farm to market, but it also — and more importantly here northwest Kansas — allows us to reclaim approximately 65,000 gallons of fresh water a day and keep that water atop the source from which it came. It allows us to, very greatly, offset our dairy farms’ draw on the Ogallala and offsets drinking water and wash-down water that would otherwise be used.

 

                                    Beyond that, we try to implement what we would call smart cow-cooling technologies. Obviously, a cornerstone of a dairy farm is taking good care of our cows, because they take care of us. And in order to do that, we need to try to mitigate the effects of heat stress. So, in those hot summer months, we sprinkle our cows with fresh, cold water. And there are times where maybe the cows are out of the pen or there aren’t a tremendous amount of cows under those sprinklers, so those sprinklers will shut off at those times. We also have those sprinklers set to increase their sprinkling time and frequency as the temperature increases. So, as that heat stress level increases, our efforts to combat that increase proportionally.

 

Tom:                          It sounds like you really embrace data. What are some important ways that data has been integrated into your day-to-day operations?

 

Ken:                            Yeah. So, data, I think, is the future of our farms in terms of how we are going to optimize our farms and our business. And you know, we're collecting data from as many sources as we possibly can and collecting data, frankly, that we don't even use today, just because we don't know how to use it today.

 

                                    But that being said, a lot of our data is very, very cow-centric. So, we’re evaluating, on a (regular) basis, herd health events, production levels, feed efficiency data, all in the effort to try to continuously drive improvement on our farms. We’re also collecting a tremendous amount of financial data that allows us to make better business decisions and, ideally, preserve our business for the next generation.

 

                                    Beyond that, we’re working with third-party groups that are quantifying infield farming data, soil organic matter levels (and) nutrient loads within the soil. Obviously, we’re collecting water use data. And all of that is flowing into systems that ultimately help us make better operational and strategic decisions for our farms and for our business.

 

Tom:                          Earlier generations relied heavily on instinct and on knowhow that was passed down from generation to generation. How does the use of data replace that reliance on instinct?

 

Ken:                            You know, my brothers and I are very competitive individuals. And as such, that kind of makes us emotional individuals. And the use of data has allowed us to step back, be less emotional about the decisions that we make within our business, within our farms, and allow us to make decisions that are really based on fact and not instinct and not emotion. That being said, instinct and emotion still have a place on our farms and within our business, you know. That historical knowhow still matters. My dad is 78 years old and is still on the farm every day. And there is a wealth of knowledge there that brings a completely different perspective. It ultimately grounds my brothers and I into — it grounds us in reality, and it grounds us in the things that actually matter. It doesn't allow us to get caught up in the details that would distract us from the big picture.

 

 

                                    So, there is always a place for that. But when it comes to executing day-to-day decisions, we're trying as best as we possibly can to ground those decisions in facts and in data.

 

Tom:                          What sorts of innovations or emerging technologies have captured your attention?

 

Ken:                            Oh, man. You know, innovation and new technologies are developing at such a rapid pace, it's almost hard to keep up with it, but the adoption of robotics on dairy farms and within agriculture in general, to me, is incredibly exciting. Finding qualified labor is increasingly a challenge across the ag industry, so being able to eliminate that human factor and implement the use of robotics, I think, is incredibly exciting.

 

                                    There are some technologies emerging now to utilize artificial intelligence to analyze large datasets and to help us make better decisions on our farms. That, to me, is incredibly exciting because, as I mentioned earlier, we were collecting so much data (that), at times, it can be overwhelming. And at times, you know, we know that we bring our own bias to that data analysis. So, utilizing a tool that can eliminate that bias and perhaps bring correlations or opportunities that we may otherwise miss, to me, is incredibly exciting. And there's other advanced things like CRISPR technology or things like the utilization of drone technology — those types of innovations will do nothing, in my mind, but drive positive change in the ag industry.

 

Tom:                          Do you use robotics or automation in your barns?

 

Ken:                            We do use some, yes. The ability to implement those types of robotics in our farms (that) are 20-year-old facilities can be somewhat challenging. But in our newer facilities, in our newer farms, yes, the implementation of robotics is coming very quickly. So, it's an emerging technology that we keep our eyes on closely. And when feasible, when economical and when possible, we’ll implement that technology.

 

Tom:                          I'm sure you stay on top of industry trends, and I'm just wondering: What's on your radar right now?

 

Ken:                            Oh. Well, you know, I believe that the future of the dairy industry is going to be a future of increased traceability and increased transparency and an increased level of accountability to our customers, the consumer, our communities and the environment. Consumers, I believe, are demanding that. Mother Nature is demanding that. I believe that we’re just going to continue to see the demand for that increased accountability increase.

 

                                    But I also believe that the trend towards consolidation is going to continue. It doesn't seem to be slowing down. The dairy industry, unfortunately, is losing farms at a very rapid pace. So, I think consolidation will continue, but I also think that there's going to be a continued emphasis on farming the right way. I don't believe that the future of the dairy industry or the future of the ag industry is going to have any place for bad operators, operators that are not working towards a greater cause or towards the improvement of the environment around him. I don't think that's going to fly moving forward.

 

Tom:                          We've been through a very strange and difficult year this past year, and the pandemic is continuing. What do you see happening as a result in the overall dairy industry? What's happening as a result of this pandemic?

 

Ken:                            Well, you know, on top of the day-to-day operational challenges the COVID pandemic has created, you know, trying to make sure that our team members stay healthy (and that) our farms stay fully staffed and operational every single day — that, in and of itself, is a big task. But the pandemic has created a tremendous amount of volatility within the markets, which, at times, can be a great thing. You know, buying opportunities have existed. But beyond that, it's just the lack of predictability that has come from this pandemic — not only the lack of predictability in my everyday life but the lack of predictability in markets, the lack of predictability in consumer demand. All of those things have taken what is already a stressful and fast-paced, high-pressure job and elevated it to a level that I hope we don't have to continue for another year.

 

Tom:                          Really! You touched on this earlier, but just to wrap up our conversation, when you sit back and think about it, where do expect the dairy industry to go from where it is now?

 

Ken:                            Well, you know, as I mentioned earlier, I think the dairy industry is going to go to a more sustainable place than what it has been historically — and that's not to say that the U.S. dairy industry hasn't made absolutely phenomenal strides towards becoming more sustainable. It certainly has, but I think there's going to be an increased drive for that. I think the dairy industry will ultimately arrive in a place where there are fewer larger farms. And I think that that's going to lend itself to, I hope, a more transparent and a more traceable food supply that should allow us to be more responsive to market conditions, consumer demands and, ultimately, needs from the environment or from our cattle.

 

Tom:                          That’s Ken McCarty, owner and manager of McCarty Family Farms in Kansas. Thanks so much, Ken.

 

Ken:                            Thank you.

 

Tom:  And I'm Tom Martin, and thank you for listening