Edmonton farm show pen of 10 sale

[ALLFARMER]

There are known knowns. These are things we
know that we know. There are known unknowns.
That is to say, there are things that we know we
don't know. But there are also unknown
unknowns. There are things we don't know we
don't know.

[smcgrath76]

Collectively we must know it all ...
Unless we don't know that we know!

I think that basic math skills and risk/reward raised its' ugly double
head to keep a lid on things. That and $14 canola.

[grassfarmer]

Yeah, 28 bu canola at $14. Wonder what basic math
skills will lead to on that front next year - more
canola or more cows?

[smcgrath76]

GF - might be a case of understood risk.
Understood risk - no rain = no crop can
happen any/every year.
Less understood risk - E coli shuts down
large commodity player.
A lot of folks would pick the understood
risk over the less understood one.
Also, the beef business tends to be slow
and steady wins the race. I think in
grain it may be easier to envision the
big profit potential on the way in.

[ALLFARMER]

Talked to a guy from Westlock I know at Red
Deer farm show. I asked him how his canola did?
He says it did ok (kind of frowning) so I ask what's
ok? He says it did 50 .....poor guy.

Preg checked 123 cows in 2 hours today 14 open
going to town girls!

[grassfarmer]

Sean, can you say "Triffid flax".
How much has the average rancher lost due to the
ecoli closure of the XL plant anyway? Hasn't got me a
cent as far as I know.

[grassfarmer]

hasn't COST me a cent.

[smcgrath76]

GF - probably a bad example. What I was
basically trying to point out is that
many producers would rather take the
risk they know - weather, grain markets,
etc. rather than the risk they infer
such as BSE and are unsure how to deal
with.
On each such side there are winners and
losers. I know our neighbours who are
in a position to store several thousand
bushels of canola and wait will do very
well in this market. Probably the other
issue with high priced land is that
cattle may not cash flow as well. Even
28 bushel canola at $14 is $62720 of
cash flow on a quarter. Most grazing
management (or lack thereof) hasn't
evolved to that level (even on really
expensive ground).

[grassfarmer]

Once you take the average canola production cost of
$51,360 off the figure you are left with isn't so
different to the potential of grass.

[smcgrath76]

I agree with that 100% GF. In fact I
would likely argue that it is lower in
many years than the potential of well
managed grass, and that grass/cows has
less inherent risk. Another challenge
is that there is quite a bit of skill
required to run larger cow numbers and
many may not feel comfortable doing so.
By the time they add infrastructure to
do it, the margins are pretty low.
Adding a 1/4 section of grain may
require less overall effort in many
business models.