Want Lower Grocery Prices- Pass Immigration Reform, Says Land O’Lakes CEO Beth Ford

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So far this year, supermarket inflation has been subsiding—at least, that’s what government economists are telling us. Even egg prices have fallen slightly from their astronomical highs. But to hear Beth Ford, CEO of Land O’Lakes explain it, the devastating effects of the avian flu will mean that higher-than-average price tags on eggs are likely to be with us for a while.

“The largest impact has hit the layer bird population with roughly 50 million birds affected, which is 13 percent of the total number of layer birds,” Ford says. “Those birds can’t be replaced overnight and that has caused a significant decrease in egg production, resulting in the steep price increases we’re seeing.”

The inflationary pressure on eggs and other food products is just one of the many challenges Ford faces. Across the globe, economic growth is slowing, global supply chains are realigning, and consumers are demanding more accountability from companies on environmental, social and governance issues.

Most Americans are familiar with Land O’Lakes butter. But the Minnesota-based farmer-owned cooperative is about much more than its flagship product. The century-old Fortune 500 company does business in more than 60 countries, producing dairy foods and animal feed for people, pets and livestock. It also runs a sustainability unit, called Truterra, aimed at helping agri-businesses reduce or offset carbon emissions, and conserve land and other resources.

Ford, in her fifth year as CEO, hails from Sioux City, Iowa. One of the perks of her job, she says, is visiting with farming families across the country. The outings help inform another of her passions: serving as an advocate for farmers and rural communities. “Their success is our success, she says. “It’s a virtuous partnership. It is fundamental to my business.”

TIME spoke with Ford recently about family farms, the agri-industry’s labor crisis, and why Land O’Lakes has raised some of its prices.

This conversation has been condensed and edited for clarity.

Want Lower Grocery Prices- Pass Immigration Reform, Says Land O'Lakes CEO Beth Ford

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Since Land O’Lakes is not a traditional corporation, but a cooperative owned by the farmers, does this structure call for a different kind of leadership?

I’ve worked in big, small, private, and public companies. I think if you stepped onto our campus, you’d see it’s like every other corporation. We’re about a $20 billion (revenue) company. There’s tremendous complexity. But I would say that there’s an intimacy to the model. And it’s not just the simplistic, ‘hey, they’re in my boardroom.’ It’s the joy. It’s the privilege of knowing their families, of being on their farms, of fighting for something for them or working for them to broaden the view of what success is for the business. We can talk the numbers, but it really misses the point, because it’s about making sure [the farmers] are stable. What I’ve been pushing on is making sure their communities are invested in. Because how do you have a successful business if you’re in a deteriorating community, if they have no technology, which is the greatest enabler of our time.

Before the [COVID-19 crisis], I was visiting with different families, different farms and recognized a lack of technology. I don’t want to date myself, but it was the old-rabbit-ears-on-top-of-the-TV kind of tech. This is just simply unacceptable—that we are not investing in these communities.

Now interestingly, I had gone to Seattle, met with Satya [Nadella, Microsoft’s CEO]. I like him as a leader because he talks about tech as an enabler for other things. We talked about technology in these towns and we partnered on enabling technology. I said, we can put something on a silo to make sure that we are beaming this out so that we can get improved technology, not just on the farm but in the communities and their schools. We had that conversation and then suddenly the pandemic occurs. And my conversation with my chief of staff and others was, “We’re going to have a real problem here because rural hospitals have shut down.”

They don’t have the capability, the expertise with technology. That’s not a criticism, it’s just a reality. We started making calls to the Mayo Clinic, to the Cleveland Clinic, to multiple companies to say we need to have variances by governors for online healthcare so they can write prescriptions without seeing the doctor in person, so that we can make sure that the reimbursement rates for these hospitals were commensurate with in-person visits. We need to turn on free Wi-Fi in our own locations, but who else will do that? Who will be with us? What was magical about it is over 175 companies and organizations were with us to push for a policy change. Not just in rural areas but underinvested areas.

And from that there’s $65 billion in the infrastructure bill to address this. My chief technology officer, Teddy Bekele, was named to run the committee for the FCC on rural technology. This is all a perfect example of structural change, of big changes that are necessary.

In 2019, you wrote an op-ed under the headline, “Farmers Are in Crisis and America Isn’t Paying Attention.” Do you feel this is still the case?

You have to be an optimist to be a farmer. Too hot, too cold, too dry, global issues, volatility in commodities. And yet they love it. Our farmers were in crisis at that time. If you remember, there were trade issues, terrible weather… Very low commodity prices. Farmers were going through a period where they weren’t making any money. What has happened since then?

Well, a lot. Grain farmers, growers… many had a good year last year, but they’re already looking to see what’s going to happen. They are seeing accelerated pricing, whether it’s fertilizer, steel, they have no labor. We can’t get labor into the country. So, are they in crisis? No, I don’t think that’s a word I would use right now. They are going through tremendous volatility, and I admire them because of their resilience.

But let’s jump to the second part of that headline. Do you feel like America is still not paying attention to what’s happening with farmers?

I don’t think Americans largely understand the fragility and the interconnectedness of the food supply. The planet’s population is set to grow to about 10 billion people by 2050. During that time, we need to produce more food than the last 8,000 years combined. That’s the challenge—with less fresh water, less arable land. And then in the United States, we have dramatic issues in terms of lack of labor, 2.5 million workers short. You think about the Congress, 435 seats, only 35 tied to rural or ag. areas. There isn’t an understanding in this country about the food supply, about production. And that makes it more challenging to not just get a farm bill passed, but to really explain what we need that is self-protective for all Americans. Food security is national security.

A lot of Americans are concerned about the rising prices they’re seeing at the supermarket. How do you explain these ballooning grocery bills?

I want to start right at the farm level. Only 14 cents on the dollar of what’s sold at retail goes to the farmer. It used to be 17 or 18 cents. Farmers have also been getting increased cost pressure. Think about the food value chain: You start at the farm and then it’s transported to a processing facility and then it’s converted into product and then it’s transported to retail. And you’ve got all sorts of cost elements there. Think about transportation alone. Trucking has gone up faster in the last two years than the last 20 years combined. Think about the labor that’s involved in that and lack of labor availability, especially during the pandemic. Think about energy, which is what runs the plants. So what we’ve been doing is to try to offset some of this supply chain expense that is coming into the business. It isn’t about huge [profit-]margin expansion.

What’s your decision-making process around how—and whether—to raise prices?

I have a family and I have concern about pricing as well. All of us do. So it isn’t about, “Well, we can get away with getting [higher] pricing.” It is, for us, that we’re trying to take some action to offset this price pressure.

Is there a solution?

You know what could be self-protective for us? To get some immigration reform. If we’re two and a half million workers short, 20% of produce in the Central Valley, bread-basket area didn’t get harvested because we have no labor. So we can help with inflation, but we’re going to need to do the hard things now. And I want to remind everybody that these farmers are families. Ninety-eight percent of farms in America are still family owned. They want the same thing for their families that we all want. Investing to address that, including labor, is so critically important—and will help alleviate some of that cost pressure.

When people hear you talk about immigration reform, they might wonder why lawmakers would consider letting people into the country to work on farms, when there are presumably lots of Americans who could do these jobs?

They don’t take jobs [from Americans]. These jobs are hard. And I can tell you, I was just in Nebraska a couple nights ago speaking to a number of farmers—and our local retailers. It’s a crisis out here in terms of labor availability. What are we going to do? Something like 40% of the labor in agriculture are immigrants. Some of them are needed year-round. But certain visas are only seasonal visas. That doesn’t work. It’s very challenging to attract workers.

You clearly spend a lot of time with farmers. What’s your favorite part of those visits?

The families. I’m just such an admirer. I grew up in Iowa. I admire their resilience, their passion for what they do. It’s been hard for me to get into our factories because we had to go through that whole segmentation of different workforces just to make sure that COVID was not being spread around the plant. So I’m trying to push out now and get back into the plants.

Early in your career, you held a lot of roll-up-your-sleeves roles in operations at various companies. Why?

My dad was a truck driver. I have a lot of what would be considered working-class family members. And certainly, I started my career doing that same thing—night warehouse, plant operations, paper and barge docks, climbing the tanks. I love it. Love it.

OK, final question: Give me one song or album, one book, and one movie that offers some insight into who you are and what inspires you.

Book: The Last Lion by William Manchester (about Winston Churchill)

Album: Prince’s Purple Rain

Movie: The Sound of Music

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