By the end of April, Interstate Commodities Inc. (ICI), a Troy, New York-based family-owned and -operated grain and feed ingredient originator, will launch its latest venture, Interstate Organics, L.L.C., a feed mill manufacturing all-organic complete feeds in Merrill, Iowa.

The company decided to make its move into the organic feed market due to increased demand for organic feeds — especially for poultry and dairy producers.

“With this mill, we’re answering the call of our existing customers,” says Cameron Gregg, ICI director of Western trading and operations. “Our customers’ customers are asking for organic animal products, leaving them tasked to figure out where to get their feeds from. This is our response to that trend.”

interstate organics feed mill

Interstate Organics’ refurbished feed mill will supply all-organic feeds to Interstate Commodities Inc.’s existing customers. | Interstate Organics

Noting that Interstate Organics' customer base is comprised of small to midsize producers, he states the company can provide a lot of added value through its supply chain and ingredient sourcing.

To meet the needs of its customers, Interstate Organics acquired and refurbished an existing feed mill to meet the strict standards of organic feed production. The company was able to completely rework and fine tune the mill in just over two months.

All-organic feed production

Interstate Organics earned its organic certification from OneCert, a third-party organic certification agency, to ensure its production facility meet all the necessary criteria.

“It’s a very involved process,” Gregg explains. “Not only do you need to certify that your equipment meets the standards, you have to certify every single ingredient. Everything that goes through the mill has to be certified organic.”

The fully automated specialty feed facility has a production capacity of 20 tons/hour operating on one line.

“Our rate equivalent projected annual output is 50,000 tons, but we have the ability to go to 120,000 tons if the demand comes on line — which is considered a lot for an organic feed mill,” Gregg says.

Interstate Organics manufactures mash feeds, but the company has plans to install a pellet mill in the third quarter of 2016.

The mill also meets the standards outlined by the Food Safety Modernization Act (FSMA).

Logistic advantage

In addition to a firm handle on ingredient sourcing, Interstate Organics also has the advantage of drawing from ICI’s well-established transportation and logistical expertise.

From the start, the organic feed company will be able to supply to ICI’s existing customers through its distribution network.

“We have access to Union Pacific, Canadian National and Burlington-Northern railroads — as well as trucks — for shipping,” Gregg says. “At the root of it, we’re a supply chain management and logistics company.”

In the short term, only bulk and semi-bulk (2,000-pound sacks) feed deliveries are available; however, the company plans to install an automated bagging system for wholesale production by the end of the year.

Its first loads will be delivered by rail to customers in Oklahoma, Texas and Missouri.

About Interstate Commodities

Founded in 1947, ICI is engaged in the origination, merchandising, logistics, and risk management of grain and feed ingredients for producers and consumers domestically and internationally.

The company is in its third-generation of ownership, currently run by three brothers: Gary, Victor and Greg Oberting, its president and CEO.

In addition to Interstate Organics, ICI also operates three grind and mix dairy feed mills in South Dakota and Nebraska; 20 grain elevators across the country; and partners with two export facilities in Ohio and New York.