Organic

[lakenheath]

I don't see the personal attacks. Am I blind? Anyways, I have to agree with Tom and Parsley on this one. How can Vader stand up so strongly for the CWB's policy on organic grain. It makes absolutely no sense whatsoever. The buyback program is a disgrace. How does this program benefit an organic producer. Vader, simply explain to me how the CWB benefits organic producers and how you personally benefit from having the CWB around. No personal attacks here.

[Jman]

Parsley:

Just wondering, what kind of hedging/risk management strategies do you use for your organic wheat production? I would tend to think that if you are typically earning
100, 200 or even 300% over conventional grain prices, that you wouldnt need to hedge your production on the markets? The only reason I need to hedge my production is to lock in minimum/floor price profit (or sometimes to minimize my losses).

[Jman]

Parsley: this is follow up to one of the question I posted yesterday about how organic production will change when the CWB is dismantled.

I would tend to think that with the CWB currently in place, that organic production is limited to only those farmers who have the knowledge of marketing their own wheat. Afterall the CWB has filled this role for almost all farmers for the last 70 years.
IF the CWB disappears, All farmers will be marketing their own grain, each become knowledgeable of the markets, and perhaps finding these niche markets.

The other point is, I think many farmers avoid organic wheat production because of the addtional administration that is required to sell their grain, i.e. performing the CWB buy-back and and aquiring an export permit, plus the potential to lose money on the buy-back. With the CWB gone, selling your wheat across the US border or to domestic processors will be a simple process as selling non-boards.

All of this could lead to a large increase in organic production that will quickly erode the premium priced market returns?

[parsley]

Jman,

1. We try NOT to grow wheat because of the buybacks and hassle. So I will presume you mean all organic crops. High buybacks have completley stopped-dead our wheat sales at times. The only one making a profit was the Board. Ontario organic growers/millers bypass the Board, entirely. Quebec, too.

2. Plant both early and late.

3. Rotations, rotations. (You always have forage for sale, even though you might get wiped out with frost).

4. Many different crops. Different varieties. (Varieties your buyers want, may not necessarily be what you want to grow).

5. No-penalty Contracting, with not having to deliver written in, if production is not of food grade. Designer contracting, so to speak.

6. Cash in the bank to cover a years' loss.
7. Hail Insurance only.
8. Inventory carryover (That value-adder may be depending upon you)
9. Domestic AND export marketing
10.Marketing to consumers, to retail buyers and to wholesale buyers.
10. We value-add some things.
11. Ask for help. Buyers try to help you. ( ie.I've got 60 bushels left over in a bin, can you help me out and can I send it along with Joe? accomodation) We need each other. Fellow farmers try to help.

I don't think organic production is of much interest to many Conventional readers,though, Jman.

Parsley

[parsley]

Flax was under the CWB in the 40's and 50's , but today, farmers are capable of marketing flax

Farmers have beeen told for so long that they are not capable of marketing wheat, by the Board, that they have come to believe it. Don't believe the CWB, Jman! You are capable. For godssake, you run a farm! Your knowledge is money in the bank.

I have faith in farmers. They are a wonderously imaginative group of wealth creators. And hard working.

We have good land, good water and good air. Isn't that a marketing advantage, right there? 42 leaders from the state farms in China came here to to find out about farming in Canada. Each of us has a story we can learn from. Uniformity and equality will likely be pitched out by 42 leaders.

Re overproduction: at this point, organics continues to be a strongly growing market, with glitches here and there. We spent one month in New York City and found out what they really will pay for. It's leaping.

We just got home from Connecticut, and the huge newly-opened organic store there was stunning. Cheapest loaf of bread, very small, was $3.49 American.

Conventional farmers chase bushels instead of price, and they seem to want to continue doing so, which is their choice. In organics, you could not farm/ rent huge tracts of land and manage it well, though. Organics takes tending. As does food.

There are no guarantees, Jman. If your chief concern is price security, stick with the CWB. You know you'll get your loonie.

Parsley

[Jman]

I dont rely on the CWB for my ultimate price. I've always used a combination of the MGEX and KCBOT to hedge prodution. I just relied on the CWB (by default) to earn an export basis. I was just wondering how organic producers manager their production costs.

Thanks for your input.

[parsley]

I just want to address Vader's accusation:

"You are riding on someone elses coat tails and trying to take credit for being an astute marketer. You are the price taker benefiting from all those who went before you."

I've heard this kind of argument from a few of the CWB's single-deskers, many times before.

How do you, or how does anybody, determine what has gone before, Vader?

For example, we marketed into Japan for four consecutive years, so we have a little experience. Many influential Japanese have visited our farm.

Just a few years ago, a national Japanese publisher, accompanied by a national Japanese TV host, flew directly to our farm and did an entire article,in Japanese only, in their top quality publication, about organics in Saskatchewan. Full color. 2 pages. About our farm. All about food and what is grown on the farm.

Was that positive for organics? I think so. Was that positive for Canada? I think so.

I truly hope all farmers benefit from it , Vader, because we want them to do well.

There will be countless other farmers who are, as we, each in their own small way, contributing towards wealth building. That's what organics is.

You can attack and resent them, or you can encourage them.

Sometimes, Vader, we just don't know what's gone before.

Parsley

[Vader]

Parsley, I apologize. I guess I need to get to know you better.

You have obviously done more for developing the organic industry than I was aware of. You are certainly not the average organic farmer.

[parsley]

Apology accepted.

[parsley]

I'm just wondering kind of similiar to what Jman is saying if 25% of conventional farmers started to go oranic would there be a oversupply of product. Does anybody remember the late 80's, and early 90's peas were huge profit until everybody started to grow them, now price is in the toilet. Does the organic market hold the same future if this were to happen? Vader reading all of the threads you support CWB? (can't imagine)

[wedino]

Vader, You've got my interest, please describe "the average organic farmer".

[Incognito]

http://www.parl.gc.ca/committees352/agfo/evidence/59_97-03-06/agfo59_blk101.html

1997 debates on CWB with organic

Victor Jarjour now works for the CWB.

[parsley]

toughgoofit,

PCI is per capita income.

According to National Geographic:

In 1990......

Iran had a PCI of $1800.00
China $300.00
North Korea $910.00
Nigeria $370.00
Switzerland $21,250.00
Canada $10,651
USA $16,489.00
Japan %15,570.00
Iceland$16,670.00
and so on.

Who do you want as a customer?

Organics tries to market into a luctative, special market. South Africa once enjoyed a high PCI, now reduced. Good opportunity fell off the horse.

Japan is very interested in organic food. They can afford to buy organics, and they have very little land and few natural resources. I want to target them, too. Willing buyers and willing sellers.

They are amazed by our opportuniies while I sense you are looking for guarantees. There are none.

Who do you want to target? Markets can grow, shrink, cease to exist in a minute, as in Iraq)

When you get married , you have risk, when you get out of bed, you are at risk, and when you grow a crop you take a risk!

Is the toonie your best bet?

Parsley

[lakenheath]

Parsley, do you farm near Swift Current?

[parsley]

No

Parsley