Think outside the bin

[cottonpicken]

And before the bla,bla,bla comes out of your mouth chaffy,please explain last years fertilizer cun un drum!

The non sencsical drivel about free fair market dynamics in ag is the fecises that some people need their nose rubbed into and hard.

Lots of sellers few buyers=lower prices

Do some people need me to draw them a picture?

Or do some here want to put money in their own pockets at farmers ignorance?

[Zaphod]

Bottom line is that crops where there is competition (canola, peas, lentils) are getting bigger. Wheat and barley acres are getting smaller. What does that tell you? Which system is working better? Hmm. I call no-brainer.

[may-be]

Hit the nail on the head zaphod.

[charliep]

Perhaps one of the main benefits of the internet is the ability to gather more information and make better decisions.

Better information on current prices both local and at final customers destination. Farmers may not like the price but but it is more readily available for all to see.

More ability to do things to drive expenses out of the supply chain. A start is the ability to deal direct with processors or at least limit the number of intermediaries that add expense to the system. Perhaps a further benefit of dealing more direct via the internet or some other route is better communication on the buyers needs and ability to satisfy them better and get paid for it.

One other thought is to actually increase the level of competition by adding to the list of buyers that will potentially buy from a farmer. There are transaction risks in that you may not know them/may be issues on delivery, etc. but your customer base can increase.

Realize this is theory in that most farmers just believe they grow a commodity with one price and it someone elses responsibility to market it for them. Perhaps your original posting and title is to get people to think different/look at ways of achieving more value. Will note cottonpicken's hitting the mother lode on a mutual fund. Took research and risk taking but the rewards were there. No reason the same thing can't be done (hopefully not as a speculator) with agricultural crops.

[chaffmeister]

CP

1. Never said everything is a o k. I comment on what doesn’t work. And I give my view as to what is needed to make it better. A OK? You’re kidding, right?

2. The “second” CWB was established in 1935 to oversee (and provide a vehicle for the feds to financially support) the failing farmer cooperatives, like Manitoba Co-operative Wheat Producers Ltd (of which my grandfather was a founding member.)

Why is that important to remember?

3. I make the distinction between the CWB and the single desk. The CWB as an institution has its short-comings but it’s the single desk (mandatory monopoly) that is the real problem. Make it voluntary.

4. Uniting farmers – great idea. Like SunKist, like Ocean Spray. Just make it voluntary and do such a great job for those that join that you won’t have to promote it.

5. Not sure, but it sounds like you’re accusing me of being a shark looking to “put money in their own pockets at farmers ignorance”.

There are far too many farmers that are “babes in the woods” when it come to understanding how the grain business works. Even worse, they don't know how to work it to their own gain. Unfortunately, there are too many “market gurus” out there that don’t fully understand it either. Go ahead and trade – pick your tops and bottoms. But if you think that’s all there is to it, you’re missing out. Better information (via internet) is a good start. Understanding the business is just as important.

I can make more money with smart farmers. That’s why I share.

6. It’s “feces”, not “fecises”. You’ve got spell check – use it.

[ianben]

Thanks Hopper

Dont think anyone is offering targets here least not to me.

Looks usable but I gather your target is with just one buyer?
The ebay buyitnow type option would be like target with any buyer you then choose.

Checking would that work for you if buyers compete.

Been outside the bin today thinking from the otherside.

If a guy had some land for me to rent what would I want him to do?

Pretend he didnt till 15th June and then, want me to offer top dollar, for a three month term.

Let me hear a whisper, expect me to contact him, want top dollar for a yearly term.

Ring me and offer me the land at top dollar for five years.

Which would you choose?

checking
I'm not a Wal-Mart store with a price tag to see on each item.

I am not either but would sure like to be.

I would like to provide a sevice to my customers,grain buyers, by having my bin full of the exact product they required and the knowledge that should they require more in the future it will be available at a similar price.

At the moment we are at best like the first two guys with land to rent but we know the only deal we want is the third.

It is just worth so much more and allows us/them to plan and invest.


burbert
Most farmers and have experienced the cheating and lying in the market, when buyers downgrade, grain they are purchasing.

A real lack of understanding on both sides here I find.

A few of my own experiances.

Dockage never explained but further explanation can be gained.

Most of my moisture claims have just been the extra water I have delivered.

The excessive bushel weight claims one buyer demands is because his mill cannot work fast enough with low bushel grain and under the present system this is the easiest way to stop farmers delivering it.

The Spanish millers are giving UK wheat a £2 premium over French while actually paying us £2 less, because the average moisture content of UK wheat delivered is 14% and French 12%. The spanish miller did not expain this without questioning as he though we would know. Most UK farmers still think we get £2 less Spanish bast****.

Lots and lots of opertunities being lost on both sides through the ineffiecency of the current system.

[ianben]

Cotton
50,000 sellers plus a new marketing system and a few dozen buyers=everything a o k

explain last years fertilizer cun un drum!

Farmers get more money fertilizer everything else we buy will will go up.

Whats the problem?

Our suppliers are not doing that great either they get bigger to survive not because its a gravy train.
Dont you want them to make a profit invest in R and D be there next year to provide you with a service?

Our prices fell thats the problem.

Think outside the bin!

[ado089]

Locally grown hard red spring wheat for sale, hundred mile diet certified, perfect for bread making. $5/lb Please leave msg.


Chaffy, where do you get some of these ideas? Of course there is a finite amount of wealth in the system. If there wasn't the concept of wealth it's self would not exist. Are we extracting it all? Probably not. I don't think there's a farmer out there, no matter their marketing beleifs, that expects everyone else in the chain to operate at zero profit. But it is a big pie, and yes could be bigger, but and slicign it up and leaving the crumbs to the farmer is where the problem lies, and that how the system, both board and non-board crops works right now. With that said there's only one place in the chain that a bunch of poisson, dirt, diesel and hard work is turned in wealth, the rest is just value adding. Figure it out and cut one more slice so everyone can have some.

The CWB, although not made permanent until 1935, has origins prior to WWI when farmers who felt that they were getting screwed by the system unified to say enough is enough. That led to the grain commision, the provicial pools and eventualy the CWB. We're no longer unified and the provincial pools are gone. Two down two to go and it's just like the wild west again. Funny how way back then there at least 10X more farmers and next to zero communication and information flow, yet they were able to come together, agree and change their reality. I think even those clowns in 423 main have forgotten this lesson.


Seriously though local processing would be a great first step and one marketing option that should be 100% free of the CWB.

[ianben]

ado089

Seriously though local processing would be a great first step and one marketing option that should be 100% free of the CWB.

Even without the CWB how can you offer that 5yr lease equivalent most of these projects require to commit investment.

Carling/Coors want this from me in malt barley but the Market will not allow them to commit on price.

Not because they want to screw me.

The opposite they want the assurance that I can provide their raw material,and understand the margins are not great.
Their worry is the Market might give their competition Calberg/Fosters an advantage over them should the market fall.

Isnt this why farmers dont co-operate more other farmers are competition.

The difference is Coors Calsberg and Fosters dont compete on price like us they monitor each other price and compete on sevice and quaility.

Exactly what an internet marketing system would allow farmers to do. Take the volatility out of the system and watch the oppertunities explode.

[Burbert]

We all know that the lack of co-operation, co-ordination is what holds farming, back, in the dark ages. Always has and always will. Farmers will never be anything important, until these issues are solved. We need like a cartel,like OPEC (FPEC) to control food supplies, then we'll get the prices that we deserve. The governments around the world, however will never ever allow such an entity to exist!! So cheap food flows to the world as always.....

[chaffmeister]

Ado:

You got me – you’re right, there is a finite amount of wealth. Poor choice of words on my part.

Single desk supporters believe there is a limited amount of wealth and it come down to an us-vs-them attitude. Glad to see you say it could be bigger – in my view, the single desk is a huge impediment to making it bigger at the farmer’s expense. Go to www.wheatmontana.com to see what an unbridled entrepreneur can do.

Might have my history wrong but I thought the first board (the Board of Grain Supervisors) was established during WWI, not before. Rather than remember why the original board and its predecessors (provincial coops and pools, etc) were established (as Cottonpicken suggested) perhaps its more important to explore why they’re gone.

Local processing – its logical for farmers to be involved in processing. Look at Ocean Spray.

[dmlfarmer]

I agree with everyone seeking more value adding and local processing of our grains. Value adding and local processing is needed and benefits everybody.

However, with the demise of our beef and pork industries we have lost more value adding than we will every gain by building malt and/or pasta plants.

Until we are willing to examine, understand, learn, and then change the system that enabled our livestock system to be hijacked, we are doomed to repeat the same mistakes on any furture endevors we attempt regardless if it is board or non board grains.

Unfortunately, grain farmers are being led by the nose into the same trap that sealed the fate of the livestock sector. Until we learn from the past we are bound to repeat the same mistakes.

[Fransisco]

Cotton said- "My farm was growing wheat before the board,the reasons it was brought in should not be forgcotton."

Here's a little history then from the WheatBoards own website.

"War rapidly changed the demand for grain from Canada and affected the grain markets in the early 1940s. The United States, now the world's largest grain exporter, was actually Western Canada's biggest customer for wheat and feed grains in this period. Along with an increased demand for wheat in Britain and North America came escalating wheat prices on the American and Canadian grain futures markets. The Canadian government was committed to a policy of price control during the war years and the rising wheat prices created new problems for this policy and for its desire to provide food aid to its European allies. The CWB, still a voluntary agency, could not source wheat in a rising market since Prairie farmers were more inclined to deliver their wheat for the higher spot market prices offered by the private traders than for the CWB's initial payments. Canadian commitments to deliver wheat to its allies were put in jeopardy. It became obvious that some action would have to be taken to secure wheat supply to meet wartime obligations. In September 1943 the federal government halted wheat futures trading on the Winnipeg Grain Exchange and made the Canadian Wheat Board the sole authorized receiver and monopoly marketer of Western Canadian wheat."

And guess what even though the war is long over the Board is still supplying cheap wheat to the rest of the world. Talk about sharks, the Boards the biggest one.

[Fransisco]

DML you're right, and the grain sector is just starting to get a taste of whats been going on in Cattle and Hogs with Canola in China and Flax in the EU right now. We need trade agreements that actually keep the borders open.

And if we want value added we need to seriously reform the labour laws, the tax code, and scores of regulations all of which right now make it cheaper to add the value outside of Canada. Which is something that goes beyond just agriculture. Mining, forestry, and all of the other natural resource sectors have the same problems we do when it comes to adding value.

[ado089]

Ianben,
You asked if I would enter a 5 year supply agreement with someone? You bet I would, but they would have to be willing to pay for the "supply security" and there would have to be very good terms as far as taking production and clauses to take into account unitentional production shortfalls. Fair contract, fair price.