Don’t tell Delta farmers that 1980s project was a bust

  • Scott Mugrage and his son, Justin, raise Black Angus and Scottish Highland beef cattle on the family farm near Delta. Photo/Shehla Anjum/For the Journal
  • A herd of elk seen at the Mugrage farm near Delta. Farmer Scott Mugrage maintains an elk herd of about 70 to provide recreational hunting opportunities, a side business to his cattle operation. Photo/Shehla Anjum/For the Journal

It’s part of Alaska lore that the state’s Delta Barley Project in the 1980s was a huge flop and that all the farmers went bust. Tell that to farmers in Delta, who are doing quite nicely.

In fact Delta farmers are succeeding, although in ways not originally intended by state planners.

“I don’t see failure when I go to Delta. I see people working and tractors in the field,” says Arthur Keyes, the state’s new Agriculture director.

Bryce Wrigley, a local barley farmer, says people around Delta get pretty steamed when they hear they are all failures.

“The only time we hear this is when we leave Delta. We never hear it around here,” he said.

Not all the original farms in the 1980s project failed, Wrigley said. There are several still farming and one where children have taken over. Wrigley himself purchased his spread in the early 1980s and has been farming since. At least 12 farmers in the area make their sole living from farming, although many have jobs to supplement the family income.

Wrigley is proud that his son raised on the farm, Milo, is now back from college with a degree in international agricultural business and working in the family business, which includes the manufacturing of a value-added product, barley flour.

Milo Wrigley’s goal is to begin export of that flour, which has a high nutritional content, Wrigley said. It would be the state’s first export of barley, ironically the goal of the 1980s project, and a value-added export at that.

It is true, however, that the Delta project flopped as it was originally planned. The state paid for the clearing of land, held a lottery to attract farmers and helped provide financing.

The idea, championed by Bob Palmer, then-Gov. Jay Hammond’s chief of staff and a long-time friend of the governor, was to grow large quantities of barley to stimulate local dairy farming and other agriculture, and to export the surplus.

The Alaska Railroad bought grain cars in anticipation of shipping barley and the state purchased components of a grain terminal for Seward, which was never built.

Tens of millions of dollars were invested in land clearing and subsidized loans, but North Slope oil production had started and the state was by awash in oil money.

Valdez, wanting to get the edge on Seward as a barley-shipping port, went ahead and built a grain silo, which still stands (it is now a telecommunications tower).

Interestingly, there was competition at the time for the location of the state barley project. Many argued that Nenana, west of Fairbanks, had better soil for growing than Delta and was at a lower altitude, which meant the growing season was longer.

Politics played into the decision, however. Jack Coghill, a Republican and opponent of Hammond, was mayor of Nenana at the time and a champion for Nenana as a location, but being politically crosswise with Hammond and Palmer didn’t help Coghill’s cause.

In contrast, former state Rep. Pappy Moss, a charismatic legislator who was a Democrat and represented Delta, won over Hammond and Palmer for Delta.

Bad luck played into the plan, however. Once lands were cleared and farmers were established, several years of unusually bad weather hit just as people were learning the ropes. Most important, world grain prices collapsed, which undermined the whole scheme.

Wrigley said land around Delta was still being cleared when he arrived in 1983, and that at the time the original concept seemed viable. Export markets were strong and Japan was importing grain from the U.S. west coast. Alaska was two days’ closer in sailing time and ship costs then were $50,000 day.

“No one anticipated the collapse of the market,” Wrigley said.

Newly-elected Gov. Bill Sheffield stopped the Seward grain terminal project when he came into office in 1982, and also ordered the railroad to sell the grain cars.

Wrigley says the stigma of the original project persists, hyped partly by the media. It also plays into the hands of politicians who cite it as an example of why the state can’t do anything right.

After the export scheme collapsed and state funding evaporated Delta’s farmers adapted to survive, focusing on local markets and niches, said Scott Mugrage, who farms and raises cattle near Delta with his son, Justin.

“Everyone has a niche,” he said.

In Mugrage’s case that niche is raising grain and feeding and selling cattle.

Other farmers developed different strategies. Some switched from barley to hay to meet the demands from Alaska’s large and active horse community, while one farmer developed barley pellets for animal feed. Other farmers grow various grasses to sell seed.

Some of the farms are very large. One is about 10,000 acres although the land is not all planted.

Wrigley developed his barley into new, value-added products. He started the Alaska Flour Co. and is developing a good business milling and selling barley flour and other products in retail stores in the state.

Mugrage owns about 550 acres and leases another 2,000, all in grain and hay for cattle. He raises barley and oats as well as some peas, which are mixed with the barley to add nutrition for cattle.

“We’re successful. We’re satisfied with where we are,” Mugrage said.

He is actually a relatively recent arrival in Delta, having purchased his farm a few years ago. But Mugrage is a veteran in the cattle business in the Lower 48 and still owns cattle feed lots in Nebraska.

He has mostly Black Angus as well as some Scottish Highland cows, which are well suited to northern climates. He sells about 200 cows a year.

With proper know-how the cattle business and other agriculture in the area are viable and could be expanded, Mugrage said. It’s important for Alaska to become more self-sustaining in food, which it once was.

“Few people realize what a short supply chain we have with our food. We depend essentially on one ship,” Mugrage said. (Actually there are two operated by Totem Ocean Trailer Express).

The federal soils conservation program, which is available to farmers nationwide, has been a big help for the Delta farmers. They rotate their crops, allowing some land to periodically remain fallow to rejuvenate the soil. The federal program helps pay for the maintenance of fallow land.

Wrigley estimates that in the Delta area, in any given year, about 5,000 acres are planted in grain, 11,000 acres are kept in grass, or hay, and about 15,000 acres are maintained as pasture.

That’s far short of the state’s lofty goals when the barley project was launched but it is still a sustainable small industry that helps support dozens of families in the Delta area.

Like Mugrage, Wrigley believes there’s a lot of room for agriculture to expand to meet local needs.

“We spend $2.5 billion a year on food and import 95 percent of what we consume. If we could increase that to 20 percent we could create a thriving local agriculture industry,” he said.

That’s quite doable if the demand is there. As much as 50,000 acres in the Delta area could be put into production relatively quickly, much of the land having been cleared in the original barley project.

What could jump-start the local industry in Delta is if the U.S. Army were to convert one of three boilers in the power plant at Fort Greely, which is nearby, from oil to biomass, with barley as the fuel, Wrigley said.

Farmers have made a proposal to the Army and it is being studied as a way for the plant to reduce greenhouse gas emissions. Two of the boilers would remain oil-fired, under the plan.

Wood chips are now used as biomass fuel in schools in Delta and Tok, but barley is superior as a fuel because it has less moisture than wood, which makes it more efficient in handling and in combustion in cold temperatures, according to the proposal made to the Army. Storage for barley is also more compact than wood chips, which means the “footprint” for storage is smaller.

Also, the barley can be burned without processing unlike wood chips, where chips must be made from scrap wood and salvage timber. Fort Greely’s fuel needs could be met with 15,000 tons of barley per year. The fuel need for one boiler translates to about a truckload of barley per day, according to the proposal.

If the Army were to adopt the plan it would allow Delta farmers to essentially double barley production, and with the land available that could be done quickly, Wrigley said.

The additional sales would bring $2.8 million in new income to the region, which would translate to about $20 million in total benefit when a multiplier is added, according to the proposal.

Tim Bradner is a correspondent for the Journal. He can be reached at timbradner@pobox.alaska.net.

 

Updated: 
08/10/2016 - 12:21pm

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