NorthStar Genetics Ltd.
In 2016, NorthStar Genetics Ltd. celebrates 20 years in business. Founded in the winter of 1995-1996, NorthStar came to life out of Minnesota Crop Improvement Association (MCIA) members’ desire to enhance current soybean and wheat business beyond publicly traded varieties. The company has grown substantially since, by forging farmer-dealer relationships and understanding that soybean seed is not a one-size-fits-all solution.
NorthStar specializes in Genuity Roundup Ready 2 Yield and Liberty Link soybeans, in a number of varieties well suited to particular geographic regions. By testing hundreds of varieties, NorthStar delivers the best advantage in terms of tolerance, resistance and high yield in a specific area.
Today, the company is the largest privately held seed company in Minnesota, producing more than 1 million units of soybeans throughout the upper Midwest and western Canada. “In terms of market share, we are the leader in soybeans in western Canada,” says Dan Hogstad, CEO of NorthStar.
Locally grown by a trusted party
Hogstad, who has a background in agribusiness with Dairyland and Keltgen, was the first employee of NorthStar. “The company formed when the board of directors at MCIA wanted to form another corn and soybean seed company in the winter of 1995-1996,” recounts Hogstad. “Twenty members of MCIA purchased stock in NorthStar and the company was organized. The first board of directors consisted of many crop improvement guys, who also owned finishing plants for wheat and conventional soybeans.”
Seedstock was purchased and planted in the spring 1996, consisting of conventional soybean lines and a hard red spring wheat called Mercury. “Our early marketing slogan was, ‘new genetics, locally grown and conditioned by someone you trust,’” says Hogstad. “It really defined who we are and still does.”
In October 1996, NorthStar secured a license from Monsanto to grow and market Roundup Ready (RR) soybeans. “There were very few early varieties available and NorthStar tried them all,” says Hogstad. As earlier maturing RR beans arrived on the scene, NorthStar gathered more investors from South Dakota and North Dakota. New distributors became involved and sales steadily grew.
The push into western Canada
“In the fall 1996 we held three meetings on how to grow soybeans in the Red River Valley,” says Hogstad. “As our distribution broadened, opportunities in Canada opened up.”
In 2004, NorthStar Genetics formed NorthStar Genetics Manitoba Inc. to distribute RR soybeans in Manitoba. The company shared ownership with 10 outstanding seedsmen in the province and its brand is current the No. 1 brand of RR soybeans in this market. “When we received our first Canadian license, we hosted more meetings, this time on how to grow soybeans in Manitoba,” says Hogstad. “With the same model and locally-grown marketing slogan things took off and today we’re the leader in terms of soybean market share in western Canada.”
In 2007, NorthStar Genetics purchased the assets of Ziller Seed, a family-owned soybean seed company based in Bird Island, Minnesota. Ziller's 75 dealers continue to sell Ziller-brand soybeans, and have joined NorthStar dealers in selling NorthStar brand seed corn.
From a few investors to a footprint all across the upper Midwest and western Canada, NorthStar now covers extensive territory and the company has 20 employees. “We originally had local investors performing the role of staff – now we’ve segued from the entrepreneurial model to a distribution-inventory-sales model.”
Nurturing dealer relationships
Hogstad says the only way for this model to work effectively is for NorthStar to build deep-rooted relationships with regional farmer-dealers. “Eighty percent of our distribution is through farmer-dealers, we have some cooperative retailers in the mix too, but we focus on the farmer-dealer model,” he explains. “Our vision is to be the seed company farmers want to sell for. This is why our outreach to growers and building these relationships is critical. We want our dealers to stay and grow with us.”
Hogstad is very hands-on in his approach. “Last year, I visited 80 percent of our dealers on the farm,” he says. “We make a point to nurture these relationships.”
He says a successful business model comes from these relationships and good genetics. “First of all you need good genetics, but we decided a long time ago that we’re not going to come up with traits and we’re not going to be the lowest price seller,” says Hogstad. “Instead, we’re going to be the relationship-based company that dealers know really well.”
NorthStar is readying for its annual dealer vacation, an incentive the company offers to dealers who have earned a set amount of points. “This year, because it’s our 20-year anniversary, we’re heading to Maui, Hawaii,” says Hogstad.
Close vendor relationships
NorthStar continues to offer the best genetics from trusted suppliers such as Monsanto, Dow AgroSciences, Bayer CropScience and more. “We have great working relationships with multinational genetics and trait suppliers,” says Hogstad.
Coming in the next year, Hogstad says there are several new traits in the works, currently awaiting approval in China. “We’re looking at Xtend by Monsanto and Enlist by Dow,” he says. “These traits are on the cutting edge in the industry and we’ll be marketing both.”
By forming close relationships with an extensive network of suppliers and dealer-farmers across the upper Midwest and western Canada and focusing on specific solutions that work for particular regions, NorthStar Genetics Ltd. has grown from humble beginnings to a leader in soybean production.