Should commodity groups evolve into co-operative type business models ?

[Rareearth]

Just a question.

Wondering if the value, sustainability has diminished :
- with plant variety breeding being privatized
- agronomic research by those chemical and fert. companies, being retained within the private companies
- plant breeders, fertility - fertilizer and biological companies
- soil testing/field zone management
- accounting and software systems
- tracking of production through live data reporting systems (John Deere, Farmers Edge, Climate etc)
- carbon trading
- insurance providers

The cooperative could take on a business model where equity that is tangible - would be owned by those who contribute into business, leveraging the collected levies, acres, and the rapidly developing digital platforms etc

Currently, part of the problem is, no strong voice for farmers, lobbying, activism, political voice, commercial power through purchasing, production, processing, tangible return on dollars invested and business growth.

Nothing tougher than trying to organize farmers, thats a given. It doesn't need to evolve perfectly in the first year, opportunities would be enormous.

Not sure if this is best discussed on a morning coffee or evening night cap-s.

[furrowtickler]

Currently there is no voice for the average size family farm
The hobby farms run the NFU and have the liberals all googly eyed
The very big farms have direct correspondence with running ag policy at the corporate level .

The mid sized family farms are being hung out to dry with no producer group anywhere standing up for the farms that make up the vast majority of the the farms in western Canada .

That’s a major problem right now

[bucket]

Interesting ...the farmers that contribute the most to these commissions and farm groups are the least represented.

If you are a 5000acre +/- farm if you complain you are not big enough to worry about or you get labelled an NFUer .

As furrow said larger farms have the government's ear.

Interesting topic as I read the APAS' Farmer's Voice rag over the weekend with a cheerleading section for Todd Lewis.

Not sure what has got better for farmers over his tenure. The sad part , much like Ritz's legacy , we may not realize his failures for a decade.

One thing is for sure , not one farm group has promoted a proactive disaster relief program. Whether you talk about 2010 through 2014 wet years, the 2019 harvest disaster, or todays drought.

They will all come again without an effective program to mitigate farmers losses completely out of their control.

One thing in the article that pissed me off and it highlights the problems with farm reps in general.

"You don't have to be on the BoD to have a big influence on policy" Lewis said. " If you do choose to put time into it you'll get rewarded"

WTF is that about ...personal gain because you dedicate some time if you have people to take care of your farm.

My impression of farm reps or wannabes is they are encouraged to get the phuck off the farm so they don't wreck or makes things worse .

Basically as John Dutton said to Beth " ...now go ruin someone else's day " and her reply was " that's the plan , daddy " Except she was competent enough to wreck the others day not the farms.

I have not met a farm rep that takes my concerns serious enough to effect change. They will talk and use lines like " thats a good idea" but really they all go back to smelling the minsters farts.

Lewis also said he wonders how he ended up in Minister's office or Ottawa or the PM to his farm....well that's the the job you phucktard. And at the same time they are recruiting you to see if you can be brainwashed. Lewis is an easy target , you will see him run for MLA or MP eventually with his decade of farm political
experience. Although can someone name an accomplishment?

Then they put Norm Hall on some committee that should have been looked at while he was President , he's the guy that stands up at meetings clarifying how a resolution should be proceeded with and drags it out to confusion. What is his legacy from APAS,,,,

Farmers in general haven't had a real voice for decades, and I dare say since Grant Devine.

[wmoebis]

I'm thinking it is the other way around, Commodity groups evolved from Co-operative type businesses. That many of the directors and hired employees helped to destroy and sell off (gift) to large companies and foreign investors.

[Rareearth]

Probably shouldn’t have used the terminology co-operative. For some is negative connotations and others positive.

Maybe grower groups should commercialize - for profit of its members or shareholders. Farmers / shareholders would buy shares. The cash flows could then be invested in other business ventures, profits to be reinvested to grow the company or pay dividends or buy back shares of those retiring. Mandate might be to focus on direct farming activities, equipment, finance, fert and chem, processing and export facilities, manufactured- value added goods, retail distribution, carbon credits, etc

Shares available to bonafide farmers of 320 acre minimum, owned, various classes of shares, etc?

Not sure what the future 10 years out would, should or could look like ?

[jamesb]

Probably shouldn’t have used the terminology co-operative. For some is negative connotations and others positive.

Maybe grower groups should commercialize - for profit of its members or shareholders. Farmers / shareholders would buy shares. The cash flows could then be invested in other business ventures, profits to be reinvested to grow the company or pay dividends or buy back shares of those retiring. Mandate might be to focus on direct farming activities, equipment, finance, fert and chem, processing and export facilities, manufactured- value added goods, retail distribution, carbon credits, etc

Shares available to bonafide farmers of 320 acre minimum, owned, various classes of shares, etc?

Not sure what the future 10 years out would, should or could look like ?

Until recently Sask pulse had a agreement with the CDC that funded them in exchange for the distribution rights for most pulse varieties. As I paid for part of the development of the new cdc pea seed, I could sell bin run to my neighbor legally. That doesn't exist anymore I am told. Its a real shame and will cost me more money in the long term. There was talk about using grower dollars to buy into a seed company or certain varieties?

[wmoebis]

Probably shouldn’t have used the terminology co-operative. For some is negative connotations and others positive.

Maybe grower groups should commercialize - for profit of its members or shareholders. Farmers / shareholders would buy shares. The cash flows could then be invested in other business ventures, profits to be reinvested to grow the company or pay dividends or buy back shares of those retiring. Mandate might be to focus on direct farming activities, equipment, finance, fert and chem, processing and export facilities, manufactured- value added goods, retail distribution, carbon credits, etc

Shares available to bonafide farmers of 320 acre minimum, owned, various classes of shares, etc?

Not sure what the future 10 years out would, should or could look like ?

Like United Grain Growers and the Prairie Pools? That is what you are explaining and how they were to operate and did for many years until BOD got other ideas. Reinvent the wheel!

[sumdumguy]

Until recently Sask pulse had a agreement with the CDC that funded them in exchange for the distribution rights for most pulse varieties. As I paid for part of the development of the new cdc pea seed, I could sell bin run to my neighbor legally. That doesn't exist anymore I am told. Its a real shame and will cost me more money in the long term. There was talk about using grower dollars to buy into a seed company or certain varieties?

Your right to sell should be grand fathered in. I doubt their agreement with CDC would transfer to you. In a court I think you are ok if you don’t use the name of the seed in your paperwork. Your peas are not pedigreed so basically bin-run generic. JMHO

[TOM4CWB]

Your right to sell should be grand fathered in. I doubt their agreement with CDC would transfer to you. In a court I think you are ok if you don’t use the name of the seed in your paperwork. Your peas are not pedigreed so basically bin-run generic. JMHO

SDG,

They did this too to Alberta Pulse Growers... on Pedigreed Seed varieties as well... I suppose the influence of Plant Breeders who tried to do a Coup at SPCDB really set things up for this move by CDC and SPCDB. APG did not help back up growers in Alberta as they chose the 'Private Varietal Seed' model over co-operation with Sask Pulse... with a little help from CDC and plant breeders in Sask.

It is difficult to provide focused leadership constant over the decades, as one close minded drone inserted in a position of power at the co-operative... can undo decades of hard work and negotiations to benefit growers in western Canada!

Does this mean we should not attempt such projects? Well the outcome of 40 years of work to do exactly what you have suggested... has resulted in a big headache from beating my head against a brick wall!!!

The Credit Union movement in Alberta, and Federated Cooperatives are two successful operations that have been relatively successful, they offer good opportunities to participate in the 'value input chain' yet few on Agriville openly support these ventures.

Good thoughts! Timely subject... Relationship building and trust are good inputs to develop in a successful family farm. Few have direct plans and goals spelled out to work in this direction... something to work towards in 5 year farm strategic plans... something our C-Team training encourages us to do! There is a good winter project, Strategic Farm planning and training, always hard to put in motion.... yet smart management time spent to create a better tomorrow!!!

Cheers

[Rareearth]

CHS seems to have a workable model in the USA

https://www.chsfarmersalliance.com/

Strongest third-quarter net earnings since 2014; $50 million of additional owner equity redemptions authorized in 2021

CHS Inc. released results for its fiscal third quarter ended May 31, 2021. The company reported net income of $273.6 million compared to $97.6 million in the third quarter of fiscal year 2020, an increase of 180.2%. Significant year-over-year earnings growth in all business segments — Energy, Ag and Nitrogen Production — and Corporate and Other businesses each contributed to the increase.

Reflecting strong company performance, the CHS Board of Directors has approved $50 million in additional equity redemptions to member cooperatives and individual owners since the December 2020 CHS Annual Meeting. The increase is incremental to $33 million in approved equity redemptions announced at the 2020 annual meeting, for a total of $83 million in planned owner equity redemptions in fiscal 2021. A distribution of $30 million in cash patronage was also made to owners in early calendar 2021, based on business transacted with CHS in fiscal 2020.

“Robust performance across CHS resulted in a very strong third quarter,” said Jay Debertin, president and CEO of CHS Inc. “Strong global demand in agricultural markets and the hard work we have been doing to gain efficiencies across our supply chain led to higher volumes in nearly every business area, significantly improving our Ag segment earnings compared to the prior year’s third quarter.

“We also are seeing increasing momentum in pandemic recovery as restrictions ease and vaccination efforts progress, which has had a favorable impact on our Energy segment results and overall performance.”

Fiscal 2021 third-quarter highlights

Revenues of $10.9 billion grew 50.9% from $7.2 billion in the third quarter of fiscal 2020.
Earnings were up by more than 40% across all business segments (and Corporate and Other businesses) compared to both the second quarter of fiscal 2021 and the third quarter of the previous fiscal year.
Energy segment results

Improved refined fuels margins resulted in fiscal 2021 third quarter margin gains, as did the absence of a $42.0 million noncash charge to reduce refined fuels inventories to their market value that impacted the prior year’s third quarter, but did not reoccur in the third quarter of fiscal 2021.
Improved margins in the company’s refined fuels business were partially offset by significantly higher prices of renewable energy credits that had a negative impact on margins of approximately $82.0 million, less favorable pricing on heavy Canadian crude oil and lower propane margins due to the reversal of hedging gains recognized during the prior year.
Overall, revenues increased by 24.2% and earnings increased by $59.6 million over the fiscal 2021 second quarter, reflecting volume and margin recovery from the effects of the pandemic.
Ag segment results

Strong global demand drove commodity prices higher, and improved trade relations between the United States and foreign trade partners led to continued higher volumes for grain and oilseed, which significantly improved Ag segment earnings compared to the prior year’s third quarter.
Higher overall margins were partially offset by mark-to-market losses for certain processing and food ingredients products, which the company expects to reverse over time.
Lower volumes of feed and farm supplies were partially offset by increased volumes for agronomy products, stemming from stronger demand due to favorable weather conditions, compared with the previous year’s third quarter.
Other focus areas

Nitrogen Production segment earnings increased in the quarter due to higher income attributed to increased sale prices of urea and urea ammonium nitrate.
Favorable market conditions for edible oils and a recovery in sales volumes compared to earlier in the pandemic drove significantly increased income through the company’s investment in Ventura Foods, LLC.
Focused cost-reduction initiatives, launched in fiscal 2021, continued to gain traction in reducing year-to-date marketing, general and administrative expenses.
The company began to bring employees back to its global offices in full or hybrid capacities as pandemic restrictions lifted. The costs of these activities are not expected to be material.
For the nine months ended May 31, 2021, CHS reported net income of $305.0 million versus $401.0 million for the same period in fiscal 2020.

“We are encouraged by overall improvements in the global economy and the positive traction we’re gaining at CHS with initiatives focused on working more efficiently and effectively throughout the enterprise,” said Debertin. “We are optimistic conditions will continue to improve over the next 12 months. The resilience of our employees and their commitment to our owners and customers has been inspiring and we look forward to the future and continued shared success.”

FY2021 Quarter 3 CHS Inc. earnings statement by segment
*Earnings is defined as income (loss) before income taxes