An Organic Farm That Began With "China's Most Beautiful Pigsty" | How Is the Organic Business Doing? ①

QDaily will run at least four stories on the state of the organic business in China. The first is Sun Commune, where the farm is the foundation of the business but not the source of its profits.

After hosting 600 visitors over the Qingming holiday, Sun Commune in Lin'an, Zhejiang, has gone very quiet.

The rice paddies, now lying fallow, are covered with milk vetch and rapeseed flowers. No farmers are working; a few chickens stroll through the fields. The pigsty, which nearly counts as a tourist attraction in its own right, is being repaired and cleaned, and the hundred-odd black pigs billed as "the happiest pigs in China" are nowhere in sight.

Three and a half years ago, Shuangmiao Village in Lin'an's Taiyang Town was just as quiet — except that half its land then lay abandoned. Most of the people left were old or very young, and there was almost no one to work the fields.

In 2013, after four years running an organic farm in Moganshan, Chen Wei decided to lease 700 mu of land in the Zhuyiwu valley of Shuangmiao Village and raise pigs on it. He had spent nearly a year looking for a site and found nothing he liked. The ideal place had to be a small valley, so the pigs could be kept in separate groups; it needed clean drinking water for them, and land where organic feed could be grown; and it had to be within a two-hour drive of Hangzhou, where Chen Wei lives.

Li Xiaosheng, who once ran production at Sun Commune and now manages the Deguyuan organic farm in Zhengzhou, told QDaily that they settled on pigs because the market already had safe, healthy rice and vegetables — and no pork that met the same standard.

Both of Chen Wei's parents taught at Zhejiang Agricultural University, and he says he grew up in the fields. After more than a dozen jobs, he still wanted to farm. Four years of running an organic farm had convinced the 50-year-old that a mixed farm was too much work. "I'd just live out here, raise a few pigs, make a couple of million a year, or even one million — that sounded fine." So he went in with four partners, put up more than 10 million yuan, and set out to raise organic pigs.

The conditions Chen Wei set for the site pointed to a larger problem: organic pigs require that the surrounding land and water meet organic standards too. That meant persuading every farmer nearby to switch to organic growing.

The farmers were not keen. After decades of chemical fertilizer and pesticide, they were sure organic farming would grow nothing and earn nothing.

To win them over, Chen Wei hired four minibuses and took the whole village to see the farm he used to manage. He also laid out the Japanese model of farming, which he and Li Xiaosheng had studied on a trip to Japan: farmers there grow the same few crops for generations, leave sales to the agricultural cooperative, and earn no less than they would in the city.

Chen Wei told QDaily that after hearing this, the farmers of Zhuyiwu said they could do the same — grow only vegetables, or raise only chickens. So Sun Commune leased the land at 600 to 700 yuan per mu a year and took on the job of selling what came off it.

And so Chen Wei's business turned back into a mixed farm. Li Xiaosheng held a meeting in Shuangmiao Village every week, explaining their ideas about organic farming, recruiting farmers willing to try it, then sorting them into jobs by the skills they had.

Sun Commune also dropped its first plan, which was to sell pork through distributors. Chen Wei brought over the subscription model he had used at his previous farm: customers pay up front, the commune packs the goods, and a courier delivers them to the door.

Today about 300 households find the pitch convincing enough to pay 25,000 yuan or 16,800 yuan a year in advance for Sun Commune's weekly deliveries.

Chen Wei has capped the model at 500 households. "After that, membership becomes something precious."

Payment up front lets the farm fix demand before it plants, grow to order, and get the money it needs before it needs it.

But the pigs still had to be raised. Chen Wei then made a surprising decision: he hired a designer to build the pigsty.

The designer was Chen Haoru, a professor at the China Academy of Art and also a partner in Sun Commune. For him, the pigsty was a chance to apply years of rural fieldwork and research into bamboo — but it had a purpose beyond farming. He hoped a building unlike any ordinary pigsty could stand in for the commune itself. "Why did they ask me to do it? Mainly to make a new image, a brand."

Before construction started, Chen Haoru spent half a year on research and design, sitting down with local farmers and pig raisers to hear what they needed. The finished pigsty is 8 meters wide and has no walls; because the ground could not be dug up, stones were used to tie the structure together. Besides sleeping quarters for the pigs there is a feeding area, a toilet outside, an outdoor run, and a swimming pool.

Chen Haoru calls the design "detached from the modern construction industry." He hired no building crew and no cement plant. He used what was at hand — light bamboo, thatch, and cobblestones — got local farmers to put it up, and invited the whole village to weave the thatched roof, a skill now rare in the countryside. It cost half what an ordinary pigsty costs.

The pigsty was finished in May 2014 and duly became, in the words of the press, "China's most beautiful pigsty." Villagers came to look, city people came, strangers came from out of province; the Hangzhou press wrote it up, officials came to inspect it, and the Venice Biennale invited it to exhibit.

In 2015 the local government even built a road for Sun Commune, making the stretch from the expressway to the farm easier to drive.

The pigsty also brought Sun Commune its first customers: seventy or eighty households paid 25,000 yuan for a year's membership. Each week the commune delivered 12 portions of vegetables, 2.4 jin of pork, 5 jin of rice, and a box of eggs, plus a chicken or a duck each month. Only after members complained that it was too much food did Sun Commune add a 16,800-yuan package with smaller deliveries.

Of course, those households were not paying simply to eat "the happiest pigs in China."

The organic market in 2014 was smaller than it is now, but far better than it had been. Li Xiaosheng, who has worked in organic farming since 2002, says the years before 2008 were the hardest: the market was tiny and consumers did not understand the product. Only in 2010 did it begin to grow, and by the time they founded Sun Commune, "the organic market was already pretty good."

"Back then it was: I want to support a farmer, I see he can't sell his stuff, so let me buy some. You probably knew nothing about product standards." That is how Shi Yan, founder of Shared Harvest Farm, describes organic consumers in 2006. She was then a PhD student in agricultural development at Renmin University of China, and she watched farmers who wanted to go organic discover that there was neither a market for organic produce nor a way to deliver it.

In 2009, Shi Yan helped start China's first CSA farm, Little Donkey Farm. CSA stands for community-supported agriculture: members pay part of the cost in advance to support local growers, and the farm delivers the harvest at regular intervals. The relationship is closer to mutual trust and cooperation than to the buying and selling we are used to.

In 2012 Shi Yan founded her own CSA operation, Shared Harvest Farm. She told QDaily that around 2014 she could clearly feel consumers taking an interest in organic food, or knowing something about it — and no longer approaching it as a form of charity. By her estimate, China now has around 1,000 CSA farms.

Walk through any supermarket and you can see that organic products cost a good deal more than the rest. That follows from the standard itself: giving up pesticides, chemical fertilizers, hormones, and other synthetic compounds cuts yields and raises costs at the growing stage alone, so the price has to rise.

And in China more and more people can afford organic food. According to the National Bureau of Statistics, per capita disposable income for urban residents was 11,769.6 yuan in 2006; by last year it had risen to 33,616 yuan.

Demand for food that at least looks safer is also growing. One food-safety scandal after another has left Chinese consumers distrusting what they buy, and against that background organic food — free of synthetic chemicals, free of GMOs, and prized by the middle classes in Europe and America — looks a good deal safer.

A report by the consultancy Mintel last August found that in China 56% of organic buyers name "contains no harmful substances" as their reason for buying, with "organic production is friendly to the environment" a distant second at 49%.

Every organic farm QDaily interviewed put food safety first when asked why their customers buy, and many of those customers are trying to secure their children's diets.

All of Sun Commune's nearly 300 member households have children. Even Chen Haoru, who would rather talk about what the commune does for the countryside, mentions that the architects and professors he knows joined because they had concluded the food problem was "all but hopeless."

In fact, in a country that distrusts food this thoroughly, organic food is no exception.

Jiang Yiying, who lives in Hangzhou, told QDaily that long before joining Sun Commune she had stuck to food labeled "organic" — but she does not entirely trust the certified organic standard either. She worries that today's polluted air, water, and soil seep into food, and whether certification accounts for that "isn't certain."

She is not alone. Shi Yan says many people believe that "the air, water, and soil in Beijing — the water and soil across the whole country, even — are polluted, so where is anything organic going to come from?"

In that atmosphere, whether a farm pays for certification matters less. In a post on its WeChat official account, Sun Commune said it would not spend money on organic certification: "Real organic lives in people's hearts." The commune, an hour and a half's drive from Hangzhou, limits its catchment to the Yangtze River Delta; Chen Wei expects members to drive out and see the farm for themselves, and to trust that the food is organic and safe once they have walked the place and talked to the farmers.

"Our certification is on the farmers' faces," Chen Wei says, by way of explaining why his business can be trusted. Beside every plot and every animal pen the commune has put up a poster of the person responsible, with their name, photo, duties, and personal motto. Every package a member receives carries a photo of the person who produced what is inside.

Both Chen Wei and Chen Haoru think naming the producer beats certification. "A city person comes to the countryside, joins in the farm work, meets these people, and then sees their faces on the rice and the pork," Chen Haoru says. "No certification system can replace the trust that creates. And honestly, nobody much trusts those systems anyway."

Some farms do treat certification as the baseline. Cao Naizhen, business development director of BIOFarm in Shanghai, stresses that they are "not showing customers a certificate for effect" — they think certification carries real credibility, and count it as 60 points out of a farm's trust score. The other 40 points are "the proof the ecology has to give us."

Sun Commune does have a system for policing its farmers and protecting quality: seeds and other inputs are bought centrally, produce is spot-checked at intervals, and any single item that draws more than 10 complaints in a quarter is pulled. On its WeChat account the commune once announced it had fired a vegetable grower for using pesticide.

Most of the time, though, it prefers to show the warm side of commune life rather than the strict one. Chen Wei is proud of how the commune gets on with its farmers: "We don't make money; our farmers always make money. Protecting the farmers' returns comes first, and that's why the farmers speak well of us." He often says he wants their incomes high enough to draw their children back from the cities.

WeChat is the commune's most important channel. The official account does not sell anything; it shows the scenery, the farm work, and the relationship with the farmers. For the first two years Chen Xinwen, who ran the account, regularly posted the progress of work in the fields for members and would-be customers, on the theory that following along would draw them in and slowly build trust.

Chen Xinwen sees what customers give the commune as "a payment made in WeChat Moments" — that is, the repost. With 60% to 70% of Sun Commune's customers arriving through friends, members sharing to Moments turned out to be effective advertising. Luo Hua, another member in Hangzhou, told QDaily she first heard of Sun Commune through the commune's articles that a friend kept posting to Moments.

Not every family can, or wants to, pay 25,000 or 16,800 yuan a year. Chen Wei says the prices are based on cost, and that the membership packages carry a margin of about 40%: vegetables, pork, and rice are 15, 50, and 15 yuan per jin respectively, and eggs are 3 yuan each.

Li Xiaosheng argues that this is not expensive. They learned from the last farm, where they priced to the organic market. Prices were too high, sales were poor, and the losses on unsold produce pushed costs — and then prices — higher still: a vicious circle.

By Li Xiaosheng's reckoning, organic rice costs three times what ordinary rice costs; organic vegetables cost two to three times as much as ordinary ones; organic animal rearing costs roughly the same as conventional rearing. He does not think organic farming is more profitable. "There's no way to make money from vegetables alone." Every organic operation he has seen in China uses farming as a base and then adds manufacturing and services on top.

Shi Yan, whose farm runs a margin of about 10%, says much the same. From what she knows of organic production, anything grown to a genuine organic standard "can't possibly produce a windfall." And even a 10% net profit has to go straight back into growing and upkeep for the following year.

Given all this, Chen Wei set his ceiling at around 500 members — and Sun Commune has lately abandoned its no-distributors rule, selling pork, eggs, and other single items through its own WeChat store and through agents, delivered to the door.

The reason is that organic vegetables are far more complicated and far less reliable than the other products. Chen Wei says they grow only what is in season, which leaves few varieties in summer and winter, and pests or disease can wipe out a crop entirely. "It's genuinely local, so the range isn't rich." Some members did not renew the next year because there were too few kinds of vegetables.

Vegetables are not especially profitable, either: at Sun Commune the margin on vegetables is about 30%, against about 40% on pork and eggs.

Chen Wei told QDaily that China still has few organic consumers and that demand is not large: "Around 90% of organic companies don't make money." He is now building out businesses that pay better — nature education, for instance, started last year, bringing city children to the commune to play and to attend summer and winter camps. A year in, it is already profitable. Farming is not.

Chen Wei's plan is for Sun Commune to become a "complex" resting on agriculture. Tent hotels and treehouses are being built; cultural products made from the natural materials on the site may follow. The other lines of business will drive food sales, but farming's share of revenue will keep falling.

Chen Wei also plans to "export the Sun Commune model," or to run it as a chain. He did not say whether what has taken shape in the Zhuyiwu valley of Shuangmiao Village was a fluke or something that can be copied.

Chen Wei, who said several times that the organic industry has seen no change and no breakthrough in recent years, denies being pessimistic about organic food: "I think the future will be fine. It's just that right now we have to work out a model."

Asked whether Sun Commune had modeled itself on anyone, three people who work or have worked there all answered no at once. All three said it was something entirely new, and that they had had to feel their way through every step of it; Chen Haoru went so far as to call it "a social experiment with a streak of idealism in it."

As for whether the Sun Commune model can stand for Chinese organic farming as a whole — perhaps that is a conclusion best left until it has managed to copy itself.

Unless otherwise noted, all photos in this article are from Sun Commune.