Interview with Charles Sweat

Charles Sweat, CEO Earthbound Organics
Phone 831 623 7880
charles@ebfarm.com

In person interview with Jorge Heraud, Feb 10, 2011

Earthbound organics is the largest producer of organic vegetables.
Revenues of 500M. Produces almost all vegetables. Heavy into lettuce and salads (spring mix), broccoli spinach and now apples. They don’t grow tomatoes. They buy carrots from Bolthouse.

About 80% of their sales are packaged foods. They grow 35K acres, 10K directly and the rest through contract with about 150 farmers of different sizes.

The grow, process and package.

Most of the organic vegetables consumed in the US are consumed at home. 10% of packaged salads sold in the US are organic. In restaurants, less than 0.1% of the vegetables are organic.
Organic vegetables are about $0.25 –$0.50 than conventional. When the crisis hit in 2008 the share of organic fell, but has now recovered. Consumers are price sensitive.

About 5% of the vegetables consumed in the US are organic. (30% in Europe and < 2% in Japan).

The head of the growing part of their business is the Senior VP of Agriculture, Otto Kramm. He gave me his number. He would know exact costs for producing.

Charles opinion is they have weeds more or less under control, so his costs are not outrageous. They employ the following techniques:
- Most of what they grow directly is in Yuma Valley (southern AZ) and they use a technique called solarization where they cover the fields during the summer with a plastic which creates a greenhouse effect and rises the temperature to 140F + for extended periods. This kills weeds before they germinate. They don’t have weeds for months after they do this
- They don’t allow weeds to grow, killing them when young. After doing this for 3-5 years the weed pressure is significantly lower.
- During these initial years they grow broccoli. The combination of the thick canopy of broccoli and solarization, is very potent. Weeds don’t get a chance.
- He said Otto Kramm would be able to give numbers
- Insects are a bigger problem for him now

He likes innovation. They designed a spinach harvester that uses a laser to cut them and a vacuum mechanism to pull them up.