Farmcorp

[ianben]

Hi Adam
I know you adressed your piece to chas but hope you dont mind my comments.
I believe somehow farmers have to find a way to match supply and demand in all comodities and STABILIZE prices.
Price fluctuation we have today is unacceptable to both producers and comsumers and is detrimental to demand.
I do not believe we have the right to sell everything our farms produce.
I do believe we should store our own excess production to garentee supply for all those sometimes you quote.
This is what the rest of the business world does.
TELL ME Adam! Why are farmers different?Are we really unable to move into the 21st century?

Regards Ian

[parsley]

Ian, I consider both production and marketing as complimentary elements that producers must adjust to.

Production must deal with nature's cycle. If we get hail, we get hail. Rather than try to conquer nature, maybe we'd be better to try and go with the flow. It is a master at adapting, and we are but mere novices. If it's wet, plant a crop that likes moisture. Those kind of adaptations are commomplace to the farmer.

Markets have the same cycle that often follow production as well as other oddities. They are impossible to predict absolutely.You want to iron them out and take out the wrinkles, and that is the same mountain Chas is trying to climb.Markets have not been domesticated, Ian and I don't think they ever will be. IF you want a guaranteed price you will settle for less returns.

Complete Market Stability is not my goal. I don't think it is ever attainable, and like production, I think we need to better improve our skills at adapting to the unpredictable.

Market fluctuations are normal...learn to live with them.


Parsley

[chas]

Thanks boys for all your comments.
Some of us are in the mind set of the wagon rut days and some of us in the mind set of creating a better way to price our product. Are we to throw our hands up and say that this is as good as it is going to get or are we going to try and make our industry better.
Adam you are the happiest man (if I read you correctly) on the website with the present Marketing system that we have. Are you a farmer? Or are you growing some funny tobacco. Its people just like you and me you created this mess. Just maybe people like us could reorganize this mess for the betterment of farmers every where.
Parsley I didn't know there was any skill in predicting the unpredictable. Most expert skilled market brokers have a worst batting average than most pitchers.
Freebird you have a relentless pursuit for trust.
Ianben I will ask your question about Farmcorp's international ambitions.
I went to the dual marketing side of the CWB meeting in Red Deer last night . I will comment in the CWB directorship meeting thread. Chas

[parsley]

Chas , your statement,

"Parsley I didn't know there was any skill in predicting the unpredictable".
is not what I recommended, and is inaccurate.

This is what I said:
"I think we need to better improve our skills at adapting to the unpredictable".

Our world is going to get topsy-turvy Chas. It is just beginning. You are going to find it harder and harder time coping if you continue to demand... 1. price stability,
Aida is the most recent; the CWB is by far, the most long-standing scheme introduced to the farming community. Farmers are still poor even though $3.00 wheat is "stable" You've got stable CWB prices, and you're not happy. You want more of the same?
2. no fluctuations
3. "the good old days",
4. guaranteed (gov't) income,
Tom Flanagan, in his article, "Why Canada is a kleptocracy?", states, "What the subsidies achieve is to underwrite
misguided economic policies. ". Good advice.
5. practicing unsustainable economic farming practices
(HIGH input costs plus profit=not attainable).
You cannot afford to farm with high inputs any longer.
6. Or demanding some regulatory scheme that guarantees you a piece of someone else's profit. Shouting it's your "right" That is Rockpile's forte, and , sometimes, you seem to lean this way.

We live in a country where we owe almost $600 BILLION Chas . Divide that by 30 million Canadians, and you will groan. We are vulnerable. If the money market refuses Canada an operating loan next year, we can't even pay our police force, or our postal workers. We are in a financially precarious situation that will not disappear through SPENDING programs.

My point was, recognize that we live in unpredictable times. Chose solutions that reflect this....... Diversity. Looking at NET instead of GROSS. Big is not always best. Sustainability.....economical and environmental.

I'll stick to my advice:
"I think we need to better improve our skills at adapting to the unpredictable".
Parsley

[AdamSmith]

Hi,
To Ianben, Farmers as people are not any different than any other people in society. Our interests and desires, our hopes and asperations are all pretty much the same. Farming and the Grain Industry in particular are quite different than anything else out their.
You can not apply the same formulas or the same solutions to the grain business as you would for say the oil business or the car bussiness. With Oil should the price fall a handful of autocratic Arab shieks can go into a room and decide whether they want to open up the taps or close up the taps. The oil was made millions of years ago and it will still be there tommorow if you don't want it until then. The manufacturing business can speed up or slow down production with just a simple decision. They can build products to spec and only build what is in demand.

The grain business on the other hand (Yes Chas I am a grain farmer) has a number of inherent realities that just won't let other business models work and achieve the same level of success.

As a grain farmer I can not gaurentee anything. Not one thing. Volume, Quality, Timeing of availability. Mother Nature can wreek havoc on all my best laid plans. She's done it to me in the past and she'll do it again.

Keeping grain off the market to avoid gluts sounds good in theory but as long as it's out there in storage it will have a dampening effect on price because the buyer knows you will ultimatly have to sell.

As far as moving into the 21st century I don't understand the question. Is this technology related or when are we going to abandon that evil 19th century form of capitalism?

To Chas, Happiness has nothing to do with it. The company of my loving wife and children make me happy. Having my son score the winning goal in a hockey game makes me happy. When it comes to the business of farming I try not to let my emotions dictate my decisions. I may be going out on a limb here but I don't beleive even you Chas are unhappy with farming but I think you are frustrated. I'm frustrated but I don't see the answer in any new grand scheme. Where I see the answer is in the small little victory's like Ianben's greenfuel. I beleive something like that has trmendous potential. Building a new base of demand is a very positive response to "this mess".

I believe farmers have tremendous power but acting as individuals making millions of independent decisions all the while acting and reacting to the current conditions of the marketplace.

Be honest if the price of Canola was $10 bu. wouldn't most farmers be mad that it wasn't $12 bu.

If it sounds like I'm trying to argue for low prices I'm not I just think because of the very uniqueness of grain worldwide we have to accept fluctuating prices and fluctuating demand. Prices will improve, they may improve dramaticly. My goal is to profit as much as possable during those good years so I'll have a cushion for the inevitable lean years that follow. In the meantime I'm trimming my costs as much as I dare and maintaining friendly relations with my banker.

AdamSmith

[ianben]

Hi Adam
Thanks for the reply
I agree with your definition of happiness and the fact that farmers love to moan.
I too love to farm, and agree your last paragragh is the only way to survive at present.
It is the millions of independant decsions that is part of the problem
I know the market is over supplied in all comodities but do I reduce production.
No! As an individual in order to survive
I have to produce more.
Modern 21st century marketing always means I can see a profit in using fert. chem. or buying some new machine.
So we all go for all out production and rely on Mother Nature or government to regulate us.

I do not agree we are unique.
Other businesses have problems with the
weather. I have given examples before and they manage them.

You say we cannot guarantee anything, from one year to the next, and I must agree with that. I know we will never control nature and should not even try.

But if FARMERS stored grain in times of plenty, it is just like oil it does not deteriorate some good seeds where found in the pyramids.
Until they had say one whole years production in the bin.
Then we could guarantee supply.Also we would have an insurance for those nasty freeks of nature.
We would be able to turn the taps on or off by aiming to REPLACE what we had sold.
I think if you look at the way modern businesses work you will see this is how they operate.
Look at our suppliers.
They hardly ever run short a chemical even if we only use a lot once every 5yrs.
I dont believe it should cost us. We just need to trust one another and realise we can all benifit from modern 21st century marketing.
Regards Ian

[chas]

Adam: You know I'm one happy farmer. There is no better way to live it. I agree with your last paragraph on the way it is and that hasn't been all bad or we would not be here discussing farming. But I also live by my first paragraph where thought and action might create a better farming world.
Parsley: you are always enlighting me on past history. I don't like government interference or subsidizes because it goes against my good farm management capabilities but I do beleive in cooperation with other farmers to create a better price. Don't complain or be negative with the system we have without a vision to where we should be going. Talk to me about something other than how good the prices are in the USA.
Your dandelion wine taster and chicken herder Chas.

[TOM4CWB]

Chas,

I don't think there is anything magic about US prices!

However, the US is the most stable, reliable, cost concious, rewarding market on the planet because they understand value and respect the ownership of property.

I hope that we will learn a few things from the US, cause if we learn respect for each other and being responsible for our own destiny, then we will be a much richer community out west here!

Good to see you still have spirit and don't give up easy Chas!

[parsley]

This account of theFarmcorp meeting is what was told to me, Ianben. I'm making good my promise, but boy was this a merry-go-round to get this information!

There was a Farmcorp Meeting held in Moosomin, Saskatchewan the end of March, in the Elk's Hall. Farmcorp wants to basically set up and operate like OPEC. They want to have included farmers from the main wheat producing countries....Argentina, Australia, Canada, Usa and Europe (Germany and England mainly). They want 70Million tonnes signed up so they can force the price of wheat up. Essentially, witholding at the farmgate.

No government involvement. only farmer-owned. They are asking for $6.50 American for wheat based at port in Mexico. That translates into $10.00 Canadian. Mark Seradin(spelling?) is the Marketing Director and made the presentation. He is trying to change the "Peasant Farm Syndrome" that is ingrained in farmers...the attitude that we have to 'take what they give us'.

They are offering shares in Farmcorp. All Class A shares are all sold. But they are offering Class B shares. They are voting shares and you buy minimum $200.00 worth of shares...Canadian .

Farmcorp gets $0.05/bushel out of all grain.....all towards administraion expenses. They have a target of 10 Million bushels.
Wheat is the only commodity.

Farmers in Montans have been quite receptive to it. France said go and get your own farmers on side first. They will hit Argentina and Australia next.

The folks attending thought the idea has some potential. There was a very poor turnout.

That's it
Parsley