If you really examine the issues that family farms face you might conclude that they are set up to fail. I am not talking about challenges like low commodity prices or high input costs. What I mean by this is that families that farm together really face tough battles that are different than regular corporate issues. I have a friend that works for a large company and it is a policy that you cannot date or be married to another co-worker in the same department. Well on a family farm you may have three brothers, three wives and the parents all working within the same corporate department. On top of this is the challenge of when the parents pass away and the siblings are left to find there own definition of family without the parents. Other factors are dealing with non-operating siblings and how they fit into this very complicated story.
Family farms are the root of agriculture but no matter where you go in North America the same systemic succession / family planning issues exist. At the Crop Production Show, I met with Elaine Froese, a professional author, speaker and certified coach on family planning issues. Elaine is great at getting farm families to follow all the proper steps to ensure a proper plan is executed and the family can be a family. As Elaine told me, “the most important thing is at the end of the day the family can have turkey dinner together.”
By talking to Elaine I can tell that step one is talking and asking questions of one another. That’s it….talking. What is everyone feeling? Who will be taking over the farm and more importantly when? I recommend that you go to http://www.elainefroese.com/ to find out more about Elaine’s process and possibly get in touch with her so that she can help your farm succession.
If the embedded video does not work please click here to load the video of Elaine
In my role at Haney Farms, I get to chat with many farmers from across the country which allows me to keep my finger on the pulse of the farming community. Another great way to further understand the pulse or the issues of farmers is to talk to equipment dealers, grain buyers and financiers to name few. At the Crop Production Show I chatted with Denton McGregor, Relationship Manager at Farm Credit Canada in Saskatoon to get his read on the current situation and what he is hearing from his clients. Denton also talks about Ag Day in Canada which is hosted by Farm Credit Canada on January 28th. If the video does not embed properly in your browser click here for the video.
Canada has very diverse agronomic conditions across the country. Many times farmers just think of the big crops like corn, canola, soybeans, barley, wheat and oats and forget that there are many other crops being grown in Canada. One of those crops is Camelina, which is being promoted by the Great Plains Camelina Company. I have known Ryan Mercer, President of Canadian Operations, my whole life and thought that I would try and learn more about this crop that I self admittedly know nothing about except that it can be planted in February and is used for bio-diesel. Low input costs, low rainfall requirements and July harvesting are what drive some farmers to try camelina on their farms. One of the marketing tools being used to convince people that camelina is sustainable for bio-diesel is that it is a true fuel only crop. Camelina is never used for food products therefore will never affect the food supply.
In talking to Ryan it is very evident that Camelina is not a crop for everyone but does provide an oilseed alternative on marginal land. As Ryan mentions in the video, there were 10,000 acres in Western Canada in 2008 and they hope to have 50,000 acres in 2009.
It is no secret that fertilizer is a hot topic for North American farmers this winter. With the volatility of fertilizer over the past 12 months and the increased speculation towards where the price is going, it seems that farmers and retailers have fertilizer on their mind 24/7.
Fertility management is key is in managing your input costs and getting the ideal yield. I firmly believe that the days are gone when you can afford to not soil test or apply the same rates of fertilizer because that is what your dad did. The science of fertilizer is becoming more complicated as agronomists get more research as to how the different elements in the soil react to one another at different rates. I find that there are many old wives tales in regards to fertilizer do’s and don’ts. This is one of the reasons that the agronomy consultant industry has ballooned in the past five years as farmers try to gain every advantage they can. I encourage you to challenge your fertilizer retailer or agronomist with questions regarding their recommendations to make sure that you understand why they are recommending certain application rates. You need to spend as much time on figuring out the proper application rates as you have spent this winter on getting the best price you could.
With the combination of GPS, mathematics and improved user interfaces’, variable rate technology is gaining more attention from Canadian farmers all the time. This is mainly due to higher fertilizer prices over the past two years and improved seeding system user interfaces.
Variable Rate application does provide you with the opportunity to manage your application of fertilizer more effectively. For more information on Dynagra VRT click on the link.
There has been a lot of discussion at CropWeek today about seed varieties. Whether it is corn, canola, wheat or barley, there are some key fundamental criteria that you should use to make the right variety selection decision. I am sure that every farmer has different criteria and puts different levels of importance on each point but the fundamental basis of decision making is present. I wanted to get the perspective of someone that sits on the otherside of the fence. Jim Downey, Research Manager at Secan works with breeders around the world to bring new genetics to the market so that farmers have access to the latest and greatest in cereal seed vareties.
I sat down with Jim Downey to see how he thinks farmers typically select a seed variety. I think that Jim really hits the nail on the head in the fact that yield, soil zone, annual rainfall and availability are all greatly important when selecting a seed variety in any crop type. Depending on your situation or the annual conditions you may change the weighting of your criteria.
Starting tomorrow, I will be traveling to Saskatoon, Saskatchewan for Crop Week . I will be attending the Crop Production Show and Crop Production week. I will be blogging and Twittering from the show on Monday, Tuesday and Wednesday. I want to make sure that that all of our readers are up to date with the latest news and discussions in agriculture. I will be providing as many posts as I can to make you feel like you are at the show.
If any of you are going to be at the show please give me a call or email me to make sure that we get a chance to meet up. Go to http://www.haneyfarms.com/ to get my contact information.
Yesterday, I spent some time talking to Dr. Danny LeRoy, Associate Professor of Agricultural Economics at the University of Lethbridge. We spoke at great length about the economy and the affect it will have on agriculture. I was speaking to Dr. LeRoy for research that I was doing for my Grainews column. To say that Dr. LeRoy is concerned about the situation would be an understatement. Here as excerpt from the column that I wrote to be released in the next issue of Grainews.
I spoke with Associate Professor in Agricultural Economics at the University of Lethbridge, Dr. Danny LeRoy about what will be the impact of this economy on farmers.Dr. LeRoy states that “realistically the amount of agricultural products produced is not going to substantially change in 2009 but the environment and risks for farmers will.”Dr. Leroy continued, “The farms most at risk are the ones that are relying on cheap credit.If interest rates were to rise due to inflation with commodity prices continuing to drop, it will be a shock to the farming system.It might create a financial situation that reminds us of the 1980’s.”
As Dr. Leroy stated to me, the two things that farmers need to be the most concerned about is currency volatility and regulation. Speculation is growing that the Canadian Dollar could be headed higher again in the next twelve months. This feeling is present due to the continued spiraling economic situation in the United States and oil is bound to catch a bullish move based on the over selling that has taken place in the last 6 months. The new administration in the US seems to be leaning more towards protectionism on agricultural products which is a significant threat to Canada. Use what we learned from country of origin labeling and be fearful of these sort of trade tactics.
Sometimes all of this economic and political talk seems not applicable to our daily concerns but the reality is that it is closer to the farm than you think. With agriculture in Canada needing trade to survive in the long term, regulation and currency are huge concerns for Canadian farmers in this poor global economy.
It is sad but so true. The graph to the left not only describes what has happened to the grain markets but also mysteriously looks like a Christmas tree. I found this picture at the blog Eds World: Grain Marketing. As Ed describes in the blog, he is not sure if he should laugh or cry.
As Ed states you should choose to laugh because if you think back on the last 24 months it really is an unbelievable story. In one breath ethanol is being blamed for high food prices and shortages of grain and then prices have bombed lower with higher supplies and a growing global recession.
We need grain prices to get to a level where both the farmer and the livestock industry can be sustainable in the long run. A major part of this is stability in the price and not the massive price swings as we have experienced in the past. When the price moves that quickly no one can capitalize on opportunities. The major question now for grain prices is what happens next?
Yesterday, New Mexico Governor, Bill Richardson withdrew his name from the appointment of Commerce Secretary due to a federal probe investigating campaign financing and an ethical business practices. According to very reliable sources, the NY Times is reporting tonight that Tom Vilsack may get the Commerce Secretary job instead. Before your head begins to spin let me explain. Tom Vilsack was just appointed to the Ag Secretary post two weeks ago of which received relatively good reviews from US stakeholders. With the Vilsack Ag Secretary nomination meeting set for Jan 14th, this will prove to be a very interesting week.
It was suggested earlier today by Project Logic Ga, a website focusing on southern moderate African American issues, that Vilsack should move to Commerce and Sanford Bishop become the new Ag Secretary. This is in response to criticism Obama is receiving regarding not appointing any southerners or African Americans to his caucus. Of course Bishop covers both of these characteristics. I also found on Twitter tonight that there are reports of Christine Gregoire filling the Commerce position.
I am sure many names are going to surface in the coming days for the Commerce position and the Vilsack switch is not for sure. But for those of us that are affected by issues like COOL and other US trade policies, this lack of stability is proving to be unsettling. It is hard enough to figure out if Vilsack is friend or foe to the other NAFTA countries but now we may have to get ready for a different person filling the Ag Secretary position again. I am not quite sure how to feel about all this hoopla but I do know that I support whoever states that they will repeal COOL first. I guess a person can only dream.
According to a press release from Tyson Foods this morning, President and CEO Dick Bond is leaving the company effective immediately. According to Reuters, Leland Tollett who was the chairman and CEO from 1995 to 1998, will resume the post until a replacement is found. By revenue Tyson is the largest processor of protein in the world.
It would seem that there is more to the story than Bond just trying to pursue other interests. Planned corporate transitions do not usually include resignations deemed to be “effective immediately.” The stock has not been very a real favorite of analysts through the commodity surge last spring but as of late had been working its way back to the twelve month highs. On the news of the resignation this morning the stock is down almost 6%. In a Wall Street Journal story posted this morning Tyson restructured its lending agreements a month ago by providing all its assets to gain further flexibility and a one billion dollar revolving loan. There has been speculation this morning by several news providers that Bond was forced out by lender pressure as a result of the restructuring a month ago. Of course this is being denied by Tyson at this time.
It is obvious that the ride in coarse grain prices negatively affected Tyson’s earnings which resulted in Bond and the company attacking the merits of the ethanol industry in the US. There has been a lot of conversation on Wall Street as to what Tyson’s strategy would be going forward in order to solidify earnings in this very volatile environment. Some speculation has circled that Tyson will sell off its red meat division to focus more on pork and chicken. This seemingly came closer to reality after the proposed sale of Lakeside Packers in Brooks to Nillson Bros became public. Several industry insiders are also saying that the sale of the red meat division would create working capital and allow Tyson to show institutional investors a restructuring plan is being implemented. Although it is easy to suggest a sale of the red meat division, the reality is that finding a buyer of such a large holding can be very tricky and may require a multi-package approach based on the limited amount of buyers and lack of profitability in the industry.
When the new CEO is chosen it will come with a new direction and change for the company. I think that it will be interesting as to whether the choice will be internal or external. Hiring an external CEO would showcase the thrust for change at Tyson while an internal choice could mean more of the same in the short term.
There is no doubt that these are very interesting times at Tyson Foods and will continue you to be in 2009.
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