The future is here. Will you embrace it?

[jamesb]

I'm with you Dave, I have followed this stuff pretty closely and through the school of hard knocks I have learned that the idea that there is a huge margin to be had in the middle of the supply chain is false. We have had the likes of FNA espouse the idea of this and its come to nothing. I have read studies by SPG and others that have always backed this up. Deals like this are a huge risk for a farmer. Its great to see new entrants in the market but is it worth the extra few cents ?

[Klause]

A few cents?


I agree this isn't for anyone...


Gotta remember My Mother worked in Int'l trade for Hamburg-Sud and Daimler in South America... shipping to Asia and Africa...


The logistics, payment, and freight volumes she dealt with makes Dave's business look like pocket change.


I owned an IT business with clients in 20 countries for 8 years.. again, not new to working in other countries.



Is there risk in Intl' trade? Yup.... But we custom spray and I have 3 accounts in collections... so there's risk in "local" business too.



As far as the argument of a few "cents"... really? Keep believing that. What we got for our wheat is 200% of the local market, that's after logistics are figured in.



If there's "No money in it" why are guys like Dave... Bornhorst... etc. doing it?


There are niche markets for specific product all over the world... Esp. in Asia. Mom and Pop noodle shops...


In barley there's more and more micro breweries that malt their own barley.


Will this ever replace commodity trading? Probably not. But it is an option.


The west is trending more and more to knowing where food comes from... who it comes from... putting a face to the meal on their table.


There's opportunity there...


There's opportunity all over. Just go out and find it.


The world's wealthiest people didn't get there by saying it doesn't work or you can't do it or it'll never be worth it.

[dave4441]

I think there is opportunity but for the most part it will be difficult loading containers on the prairies. I can't be competitive (unless I want to give all my net margin away) shipping lentils to India from Kindersley in containers. Need hoppers to Vancouver and stuff there. Maybe if you farm right near Calgary it may work, but companies increase there price the closer you get to Van, which offsets it.

We are in the business of volume like any grain company. But need infrastructure to make it happen. Have to load hoppers and stuff at port to be most efficient, but even then wheat will be a very tough market to compete in (I tried this in SA and still looking at it but it simply goes nowhere. Small volume special crops like canary and some green lentils business works. Today I doubt its possible on wheat, but you may find a niche here or there. I don't for a second condemn anyone from trying that. 10 years ago we started with a couple million in trade in our first year. Grown exponentially from there but takes time. We were 50 farmers for first 10 years.

Logistics is easy part and there are a zillion people that will help for a reasonable fee.

The whole basis of this thread was selling to a person on Kijiji/Alibaba. Good luck on that, I doubt commodity business will ever get there and the players in that arena scare the shit out of me. Maybe I get proven wrong but I doubt it. Too many moving parts.

[Hopperbin]

Bornhorst st gregor sells green peas and canary seed. He cannot compete anywhere else.

[Hopperbin]

Cannot do yellow pea business.

[sumdumguy]

We have been beating the bushes for foreign wheat sales and we can't compete, not even close. There are taxi drivers every day phoning and wanting 100 metric ton a week, not that they know how much that is. Just tell them you want payment up front, the end of the story. Fishermen, the market is full of them. Dave, I know it looks easy but several of us have learned in the school of hard Knox. Live and learn that you can't be too careful and letters of credit, you hit it on the head. Instead of buyers beware, it's seller beware, but everyone has to learn their own life lessons.

[Jay-mo]

A friend of a friend made a deal to direct sell to a chinese buyer. Everything went well, chinese buyer received grain, Mb farmer got paid.....double what was agreed upon!
So he contacts buyer and is told to direct the overpayment to a certain other bank account....
Farmer is upset now, asks what if I dont?
Chinese buyer says he will get a special visit to his home in Mb.....
Farmer redirects money to specified bank account.
True story.

[Jay-mo]

A friend of a friend made a deal to direct sell to a chinese buyer. Everything went well, chinese buyer received grain, Mb farmer got paid.....double what was agreed upon!
So he contacts buyer and is told to direct the overpayment to a certain other bank account....
Farmer is upset now, asks what if I dont?
Chinese buyer says he will get a special visit to his home in Mb.....
Farmer redirects money to specified bank account.
True story.

[sumdumguy]

Jay-Mo, now the Internet makes it easy for them to find us. Did this farmer set up another deal with them? There's a lot of shenanigans going on with investment firms in those countries. I just read about a couple being held in jail in Canada right now. Do we want any part of these deals. Pas Moi!

[Jay-mo]

That was the last deal he did with that particular buyer.
I guess he found out from some other broker who had seen this before. That Chinese buyers were using this tactic to get money out of china without scrutiny. Two sets of paper work, the one the farmer got and then the fudged papers for the Chinese powers that be.