A conversation with Fabio Sakamoto, co-founder of Rizoma Agro, about bringing down the costs of producing regenerative organic grains and pulses and how to scale this to impact more acres.
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After 15 years working in management consulting and private equity, Brazilian entrepreneur Fabio Sakamoto decided to join his partner Pedro Diniz on a mission to revert the climate crisis by scaling regenerative organic agriculture.
Together, they founded Rizoma Agro, a company that aims to accelerate transition to regenerative organic production by creating the world’s most efficient supply chain. The company is currently Brazil’s number one supplier of organic grains and pulses, serving major food companies such as Nestlé and Unilever, and also exporting to the US and Europe. Besides operating its own R&D farms, Rizoma Agro partners with large-scale farmers to whom it offers Regenerative Organic-as-a-service platform.
How do we scale regenerative organic grain production to the point where it is cheaper than conventional extractive agriculture?
Regenerative Agriculture is the biggest solution Sakamoto found for the climate crisis which started his desire to learn more about the problem of the generation. He started to find a transition from his previous work, hence the foundation of Rizoma Agro. As an investor, Sakamoto asked a lot of questions to his business partner, Pedro Diniz, while looking into Agroforestry and research on a farm that they own.
“We looked at everyone here and we realized how agriculture was done and we said, ‘this doesn’t make any sense.’ At the same time, there was a lack of innovation. There was this kind of agriculture bias. Substitution, but not anything new. We had to get a team together and start researching for innovation on our farm.”Fabio Sakamoto
Scaling Regenerative Organic Production
In their research, they were looking for innovation on how to add citrus production in agroforestry in an efficient way. With a decade of research, they found a way to profit from organic eggs, fruit production, grain production, and dairy. With extensive agricultural research, they are looking for a way to scale regenerative agriculture of soy.
“In 2015 or 2016, we were seeing inflection points in the organic market. Suddenly, things are looking up. We are dealing with agriculture products. It’s fresh, we can’t store it for very long. The supply chain wasn’t there, the value chain. Things are starting to change. That’s when we started to say, ‘How can we use this knowledge to change and influence the system?’”Fabio Sakamoto
Costs of Regenerative Organic Production
In the next two years, Rizoma Agro plans to reduce the production cost of the regenerative organic crop by 30%, so the difference with conventional will only be 18% mainly through the use of biologicals. Research show that a price premium for regenerative organic of 20% is the tipping point.
Despite neighboring lands having a tough year, by working in organic production does not affect them as much as conventional extractive production. Having good soil, good research and learning curve, the new way of agriculture gives the advantage to have an average result since it is performing better than conventional production.
“We had a tough year, and it was also a tough year for the conventional laborers, but I think, because we are doing other things at the same time, and there is so much innovation in technology, I didn’t even experience this effect. For me, the biggest effects were getting the basic right, the timing of operations, and the seeds, and what you do, when you do it, how you do it, getting the team better.”Fabio Sakamoto
Regenerative Organic as a Service
Brazil is known for their super large-scale farmers. They increased in size over the last 30 to 50 years. The current generation of farmers are looking for a sustainable solution in farming that is why Rizoma Agro is offering a service package where they partner with a farmer and transfer technology to help them produce and sell grain. This will help farmers to produce regenerative organic supply and still earn a living.
“I think part of the interesting process was us coming kind of from the agro-ecological point of view, and you really engage with people on a personal level. You see that they want to change things, and they’re tired of being the bad guys. Farming, as I think everyone knows, it’s a tough business. The food system is not really fair to farmers, but that’s another issue.”Fabio Sakamoto
Regenerative Organic Approach in the Future
Sakamoto emphasized that in the future, they are interested in furthering their technological development. With 12 years of research, they want to continue improving to keep increasing productivity, lowering costs, and making regenerative organic more competitive. Using their team of professionals to continue their research and looking for solutions to stay ahead of the curve.
“This is what we do in our team, combining professionals with decades of experience of organic with professionals with decades of experience with conventional. One guy has very good inspiration and observes nature, the other guy is good at operations, at standardizing things and also in bringing a lot of science, and research, and isolating factors. Put these two guys together in a room and really interesting things come out, but you have to find this bridge for these two worlds to collaborate.”Fabio Sakamoto
To learn more about Fabio Sakamoto, co-founder of Rizoma Agro, agroforestry and how to scale regenerative organic grain production, download, and listen to this episode!
Fabio Sakamoto, co-founder of Rizoma agro, whose mission is to accelerate the transition to regen organic agriculture, by creating the world’s most efficient supply network.
Other interviews mentioned in the conversation:
- How to finance a radical transition while having skin in the game – Mad Agriculture and the Perennial fund
- Sean Kidney
- Jonathan Lundgren
- Nicolas Verschuere
- Eric Jackson
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