Production regions are being redrawn: Margins

FOUNDERS2FOLLOW  ·  A FARMERS2FOUNDERS PORTFOLIO SPOTLIGHT

Jorge Fernandez-Galarreta on building Margins, the company helping global agriculture companies discover and manage their future production regions.

https://www.youtube.com/watch?v=X3Uxv44fx0o

Somewhere in the world right now, a fruit company is deciding where to put a new variety.

Not a small decision: quarantine, nursery stock, grafting, years of waiting, and often millions of euros committed before a single piece of fruit reaches a shelf.

And a surprising amount of the time, that decision gets made on latitude, habit, and the word of someone who’s been in the industry a long time.

Jorge Fernandez-Galarreta thinks there’s a better way. His company, Margins, uses global climate and earth-observation data to find the places on earth that match a given production region and then keeps watching those regions once growers are in the ground.

Co-Founder of F2F Skye Prior, sat down with him for our Founders2Follow series to talk about redrawn maps, a red pear that never turned red, and why “follow the money” turned out to be the most useful advice he’s had.

The 30-second version

Margins works with fruit and vegetable companies to discover new production regions around the world.

These companies are under pressure. Climate has made some of their staple regions not a fit anymore, and they’re looking at where to diversify. But we also like to think a little bit positively — climate is opening new areas where their crops can thrive, and markets are developing where their crops are in demand.”

There are two halves to the business. The first is discovery: telling a company where in the world their variety will actually perform. The second is monitoring: watching those grower networks over time so agronomy teams know what’s happening and can deploy the right practices in response.

Looking from above, then looking closely

Jorge came to agriculture sideways, via remote sensing.

I got into remote sensing because I really liked looking at things from above. It had this level of clarity and objectivity that was really nice. And then along my journey I stumbled upon agriculture, which I think is completely the opposite.”

What struck him was how local the support around a grower is. Your agronomist is probably an hour away from you. Meanwhile climate is changing and markets are changing so maybe a grower in Spain should be taking advice from someone in Australia.

That was the starting concept. What narrowed it into a business was a piece of advice he now repeats often: follow the money. Agriculture is full of problems worth solving. Far fewer of them are urgent enough that someone will pay to solve them today. That filter took Margins to the fairly niche world of variety management and crop suitability, a niche that happens to sit directly on top of Jorge’s remote sensing and geospatial background.

Five hundred conversations, then two

The company was bootstrapped, and the validation phase was long. Jorge quit his job and spent roughly a year on the problem across Iowa, California, the Philippines, India, Europe.

The feedback was luke-warm and pivotal in equal measure.

Everything we were getting was, ‘Yeah, this is a big problem. Yeah, this is cool. Yeah, we’re interested.’ We were not getting that moment where it would change immediately. Until it did.”

The turn came through the Farmers2Founders Land x Launch program in New Zealand, which pushed the team to get specific and work inside tighter constraints, something Jorge says he’s a big fan of. Out of that came the variety management niche.

It was probably no joke over 500 conversations. And then it took two. People were not saying, ‘Oh, that’s cool, let’s chat.’ They were saying, ‘Where do I sign up? How much does it cost?’"

That’s the signal he tells other founders to wait for.

Why the map is being redrawn

You just need to look at the news. There’s constantly a headline about this being the worst season for potatoes in Europe, or wine regions in northern Spain struggling to keep up.

Jorge draws a distinction that matters. Climate change, in his description, has been a slowly shifting force. Volatility is the sharper problem- heat waves, sudden and enormous rainfall, and it’s hitting crops that had been comfortable in the same places for decades.

The evidence backs him. A Washington State University study published in Environmental Research Letters analysed more than 40 years of climate data across US apple country and found the three largest apple-producing counties, Yakima in Washington, Kent in Michigan and Wayne in New York among the worst affected. Yakima alone, with over 48,800 acres of orchard, showed harmful trends in five of the six metrics the researchers tracked. Days hot enough to sunburn fruit have roughly doubled, from about five a year on average in the early 1980s to more than ten in recent years.

The second force pulling the map around is demand. Consumers in new parts of the world want products that have never been sold to them before, so these companies are entering markets they’ve never operated in.

You might have been growing pistachios in California for the past 40 years. But now, if you want to grow pistachios in Southern Europe, what does that look like? What are the climate complexities you’re going to have to face?

That one isn’t hypothetical. Spain’s pistachio plantings have grown nearly five-fold since 2017, to around 79,000 hectares in 2024 on agriculture ministry figures, a boom the reporting attributes to drought, and to growers switching out of cereals and wine grapes that no longer paid.

New opportunities are being opened while some others are closing.

What a club variety is, and why the map matters so much

If you’ve eaten a Pink Lady, a Zespri kiwifruit or a Driscoll’s berry, you’ve eaten a managed variety. Jorge’s analogy is Adidas.

These companies designed an apple or a pear or a berry. They produce it, locally or in different regions around the world. And they commercialise it — they find the distribution channels.

This is a large and fast-growing business. Zespri sold a record 248.1 million trays in its 2025/26 year for NZ$5.9bn in global fruit sales and its highest-ever profit. T&G Global’s ENVY has become the first New Zealand apple brand to pass NZ$1bn in global retail sales, now grown in more than 13 countries and sold in over 55 markets. T&G’s chair told investors the premium branded apple category is forecast to reach $52.7bn by 2035, compounding at 7.6% a year against 4.4% for mainstream apples.

And the pipeline keeps filling. WIPO logged roughly 29,070 plant variety applications worldwide in 2023, an eighth consecutive year of growth, with about 195,600 titles in force at year end, up 21% on 2022. Every one of those is a plant that eventually has to go in the ground somewhere.

Growers licensed to grow that variety pay royalties back to the variety manager. It works because it solves the grower’s oldest problem: you can produce almost anything, but if you can’t sell it, that’s a problem. A club variety comes with guaranteed demand and a premium price per kilo.

Which is exactly why placement is so unforgiving. Margins’ aha moment came from a partner with a new pear variety whose whole appeal was its bright red skin. The company had sent plant material to the traditional pear-growing regions, through quarantine, into nurseries, grafted, then years of waiting.

At the end of that process, they found out that some of those regions were just too hot, and because of that the red colour was not developing. That means the grower can’t sell that pear. That means the variety manager doesn’t get any royalties.

Margins came in after the fact, but the company had since built a new expansion strategy, and when they compared it against the model, the model pointed at the same regions they’d independently landed on. The financial shape of that kind of mistake is public in Margins’ own case study: €1.9M in revenue lost, in a single country, on a single variety.

The idea of finding the areas where varieties perform is not new. It’s just very slow, very expensive, and it often relies on anecdotal evidence.

How the model works

Two phases, in plain terms.

Phase one: drill down. You tell Margins where your best operation is. The model takes that region apart layer by layer, “almost like a cake”, building a climatic profile: maximum temperature across specific months, growing degree days, solar intensity, and much more granular things like the delta between average night and day temperature.

Those little rules are what define whether this apple is going to be crispy or not.

Phase two: match and score. The model finds every other part of the world with those conditions, then pulls back the historical data, 11 years as standard, up to 25, and compares each candidate region against the reference pattern, variable by variable, across billions of data points. Out comes a similarity score.

It tells you this region is 85% similar to your reference. Over the past 11 years, this is how it developed, and these are the variables that might give you trouble.

That last part is the bit customers care about most, because almost anything can be managed if you know in advance what you need to manage. Too cold in a particular window? Then that’s a variety choice, or an agronomic practice, decided before the trees go in the ground.

The hard part isn’t the data. It’s trust.

Ask Jorge what’s genuinely difficult and he doesn’t say the modelling.

What’s difficult is gaining the trust of these companies. And what makes it extra difficult is that internally they already have some sort of logic for how to do this.”

Margins isn’t turning up to tell an established variety manager they should be in Italy- they’ve been in Italy for years. The job is earning the right to be believed about the regions they haven’t found yet.

The other obstacle is more prosaic: getting to the right person at all. It’s a relatively tight-knit community, and one in which, as Jorge describes it, plenty of companies approach agriculture as a whole with blanket statements about improving yield or lowering cost. Jorge credits the Farmers2Founders Land x Launch program with partnering them up with people whose New Zealand networks compressed what he reckons would otherwise have taken a couple of years.

Once you get there and you show them the data, everything becomes a lot more straightforward.

The two things that surprised him

Ube, from Bohol to Ivory Coast. The purple root crop grown, as Jorge describes it, mainly on the Philippine island of Bohol- is having a global moment, and Bohol can’t supply it alone. The model found near-identical conditions in Ivory Coast, a region under real pressure as its cocoa production struggles with a changing climate.

That’s a beautiful case: a production region moving away because of climate, and a new production region moving in. Growers should be the beneficiaries of our insights — new people wanting to buy a new product they happen to be perfectly suited for.

The market has since moved exactly the way that example implies. Philippine ube production has fallen from over 15,000 tonnes in 2021 to around 12,483 in 2025 even as exports climbed roughly 20% to about $3.2M and the Philippines has started importing frozen ube from Vietnam to cover its own demand. Ube now appears on menus at 95 US chains, up 230% in four years on Datassential’s numbers, helped along by Starbucks putting ube lattes on the board. Fitch’s BMI unit drew the obvious conclusion: if the trend holds, other countries and commercial growers will plant their own supply wherever conditions suit. That is the question Margins exists to answer.

The other half of the example has hardened too. Climate Central calculates that over 2015–2024, climate change added about 40 days a year above 90°F, past cacao’s comfortable range, and across the cocoa regions of Côte d’Ivoire and Ghana, which together grow more than half the world’s cocoa. Ghana has since projected a 16% fall in production for 2026/27, with Côte d’Ivoire also expecting a smaller harvest.

How well the model performs. Blueberry flavour, as Jorge puts it, is a bit of a roulette. One company has built its entire reputation on beating that, picking ten specific microclimates and growing one variety across them for consistency. Margins fed one of those ten regions into the model and asked it to find the others.

We were on the money in 70% of the cases and we found a few others. It still surprises me every day how relatively accurate the model is.

Where this goes

Right now the focus is variety management, because those companies have the most immediate incentive to pay. But Jorge’s longer view is anyone with a multi-country supply chain in high-value produce.

His favourite illustration is a thought experiment about peanuts. A very large confectionery buyer sources from a handful of regions in North and Latin America that have seen real volatility. Margins has found that parts of Albania share near-identical growing conditions with some of the strongest producing areas in Georgia, in the US.

If I was them, I would like to start setting things up in Albania, because I know that’s a way to diversify my supply chain.

The other half of the vision is monitoring, and it’s the half Jorge gets most animated about. Agronomic knowledge is scarce and expensive, and today it gets spent on aeroplanes- Brazil, then South Africa, then India, then New Zealand.

We help those companies scale the team they have, without needing to send them around the world 10 out of 12 months of the year.

Best advice he’s had

You get a lot of advice, solicited and unsolicited. Sometimes you go on LinkedIn and it’s overwhelming- everybody’s telling you what to do and how you should feel. The best advice I’ve got is: follow the money, and try not to die.”

Focus on who is actually willing to pay. Stay calm. Don’t give up. And in agriculture specifically, understand that the industry has enough layers that you simply have to survive long enough to sift through them and find your match.

Jorge’s ask

Margins has been bootstrapped for two years, has its first meaningful commercial partners signed, and is now shifting gears. Two asks:

1. Companies with a placement or monitoring problem. If you’re diversifying into a new region, or you have a new variety that isn’t performing where you’ve put it, or you need better oversight of your existing grower network- Margins can add value quickly.

2. Early investors with industry reach. Margins is opening its first raise, with a small team looking to grow to around five people. 

Get in touch: jorge@margins.farm  ·  margins.farm  ·  Margins on LinkedIn. 

Founders2Follow is a Farmers2Founders series putting founders from our portfolio in front of producers, agrifood operators, partners, industry and investors. Watch the full interview with Jorge above, and follow Margins for what they find next.