Sego's Herb Farm was featured in an article in The Columbian. The text below is reprinted with permission of the author.

DEAN BAKER, Columbian staff writer August 1, 2001; Page c1

LA CENTER ---- Fresh from the world of high finance, Roger and Kathleen Sego have moved to the country here to nurture a new kind of farm on the rich loam highlands east of town. They're growing organic medicinal herbs: three acres of ginseng, two acres of goldenseal and 500 ginkgo trees. Three accompanying acres of echinacea angustifolia failed to produce a profit. Now the Segos are thinking about growing organic garlic, as well.

It could be an organic farming breakthrough for Clark County agriculture. Their effort is a beacon that might either flicker out or serve as a guide for Clark County farmers looking to launch into lucrative international markets.

Organics (pesticide-free) can work, Roger argues. But ginseng? Yes, said Roger: organic, and with plenty of cash to back it up. While more than three dozen Clark County small ginseng farmers lost their shirts in a saturated nonorganic ginseng market over the past few years, the Segos' 3-year-old, 55-acre farm is about to turn a profit. Why? Because it's serving an emerging market, based in China.

The herbs are ingredients in health-enhancing compounds used to fuel the human body, fight colds and heal burns. Most of the remedies are made in China and marketed in Hong Kong. Organic medicinal herbs are rare, and in demand. Sego named just two other organic growers: one in Friday Harbor, the other in British Columbia. There are also so-called "wildcrafters," who harvest wild, natural ginseng from the woods.

Nonorganic ginseng, on the other hand, was a fad crop in the 1990s and became quite common here. Clark County had about 50 nonorganic ginseng farms in the early 1990s; now it has about a dozen, all of them small. In Washington in 1998, there were about 160 nonorganic growers with a total of 200 acres in ginseng, according to the Pacific Northwest Ginseng Growers Association, of which Roger Sego is president. In 1998, the Washington farms produced about 12,000 pounds of ginseng ---- or one-half of 1 percent of the total U.S. production of 240,000 pounds. The 1998 Washington crop was valued at just $240,000. The production cost was about 26,000 an acre over four years, the association said, with a yield of 2,800 to 4,400 pounds. That's a bit shy of Segos' outlook for 2001-2002.

He figures on getting between 3,000 and 4,000 pounds of fresh ginseng root at $25 a pound: $75,000 an acre. That compares with the current going price of $15 a pound for nonorganic ginseng, which is down from $55 in the early 1990s, $40 in 1995, and $20 in 1998. Expenses are likely to be $20,000 to $25,000 per acre, said Sego. "I actually could get 500 pounds off this field," he said, "and break even."

He intends to have four acres of ginseng growing, one acre ripening each year, all of it hand-hoed. He plans the same amount of goldenseal. Sego thus tallies $50,000 profit each year on a different acre. He's hoping for a better price for ginseng, and said he's lately been negotiating a contract with an English company at about $60 a pound. "There could be some substantial money involved, for ginseng, on an organic basis," he said. "But that's pie in the sky. Until the fat lady sings, I just count my minimum."

Cutting into his profit was a major setback, the failure of his echinacea. He got 2,000 pounds an acre at $7 a pound ---- too little for a profit ---- and he's not growing echinacea any more, letting the land to go back to pasture grass and thinking about garlic

For the goldenseal root and leaves, Roger expects $15 a pound and about 8,000 to 10,000 pounds an acre, optimistically $150,000 an acre. The dried ginkgo leaves have gone for $7 a pound. The trees are only 31/2 feet high, so it's too early for an estimate there. "It's early in the game," said Washington State University horticulturist Charles Brun. "I hope he succeeds."

Organic pipe dream? Most farmers believe it's impossible to grow ginseng organically. "Everyone has told me from day one that you can't grow ginseng organically," said Roger, standing and smiling in the middle of his organic field. "I hope that word stays out there."

His secret is a "compost tea" he makes in consultation with plant pathologists and horticulturists at both Washington State University and Oregon State University from waste from organic Hood River apple orchards. While this "tea" and his homemade brewing method are unproven, they should be watched with optimism, experts said. Brun backs Sego. "He is somebody trying to chisel out a niche in agriculture," said Brun, "and that's what we need more more than anything else."

The Segos came to this farm well-studied in herbs and with capital from a lifetime of work. They paid about $1 million cash for the farm, formerly a beef cattle operation. The acreage is ringed by maple and aspen trees and includes a new four-bedroom house, two tractors, diggers, plows and discs

Roger was an executive with American International Group Insurance company and an organic fertilizer salesman. Kathy was an investment banker. This farm is their retirement dream. Married 30 years with two grown daughters, they lived in Portland's exclusive Dunthorpe neighborhood before moving here. Earlier, they worked in Chicago and Seattle, where they gathered up the necessary cash.

Although Kathy plans to keep working for a computer startup, Roger said he expects the farm to support the couple in style by next year and even to yield a half-million dollars a year within three years. Good timing They timed their move onto the farm. "When the ginseng price was $40 a pound, the seed was $135 a pound and you needed at least 100 pounds to plant an acre," said Roger. "That's why many didn't plant an acre. But when I got into it, the price of seed was $30 a pound." So it worked financially

"You don't start an operation like this if you don't have money in the bank," said Roger. "Your interest alone would eat you alive." It was while selling fertilizer to ginseng growers in British Columbia that he got his idea for this farm. "I came back to the hotel that night and called Kathy and said: 'I've found what we should do in retirement,'" he said.

They had been thinking of a Christmas tree farm, but this idea clicked. The right soil is the key, he said. He shopped for months across Clark County, turning shovelfuls in many fields before settling into the place two miles east of La Center. It was the right moment, he said. At one time, British Columbia and Ontario each was growing 4,000 acres of ginseng, and Wisconsin had 2,000 acres, said Roger. "With that type of supply, the price went down to $8 at one point." Then ginseng farmers dropped out by the hundreds and thousands. Wisconsin entirely got out of the business. And then the market began to recover and change, Roger said.

Organic has new appeal. But neither he nor Brun expects a great rush of farmers to grow organic herbs. Still, "if a guy was a gambler," said Roger, "now would be the time to get into the ginseng business because the price is so low." Dean Baker covers agriculture. Reach him at 360-759-8009, e-mail dean.baker@columbian.com.