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April 2015 $3.50

Job Done

With Joint ventures, the McGregor family Takes on Succession, PG. 16

+PLUS Check these five business tips to be a winner in 2015, pg. 12 CROPS GUIDE ďƒ¨ In more canola, the solution is phosphorus, pg. 42

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Contents

april 2015

BUSINESS 8

star writer Jennifer Bain is the food columnist at the Toronto Star, Canada’s largest newspaper. Hmmm… maybe we should get to know her.

12 time to be a gamechanger

You’re the coach, and the year is approaching half-time.

Our Maggie Van Camp brings five strategies for a sizzling finale.

PG. 16 Their Joint path to succession Joint ventures have been instrumental in letting the McGregors not only keep their family together, but also keep their farm growing while they negotiated their way to a healthy succession plan. Could this be the right strategy for your family too?

22 who are theY REALLY?

Personality testing is an essential management tool outside of agriculture. Now it’s moving to the farm too.

25 team building on the farm

It may seem the sort of idea that only an office worker could love, but you might be ready for team building too.

28 a place on the farm

Charlene Bradley’s story may be a new template for women wanting success on the farm and in agri-business.

32 our other business

Farmers aren’t just producers. In effect, they run land investment companies too. But are you any good at it?

34 the strategic approach to managing employees

HR is the least liked part of most managers’ jobs, which is too bad because the potential gains are so rewarding.

36 your value-added marketing plan

As these farmers tell Helen Lammers-Helps, your value-added work doesn’t really begin until you tackle your marketing plan.

39 Guide HR — don’t work harder, work smarter

We all want to be more productive. And here’s the good news.

Our Pierrette Desrosiers can help you get there.

40 JBC builds market share

British manufacturer JBC used to build construction equipment.

Now it has its eyes on your farm, with some ingenious designs.

CROPS GUIDE EVERY ISSUE

42 phosphorus “ph”inancials

Will an extra 20 lbs./ac. pay off in your 2015 canola?

6 MACHINERY GUIDE

46 boost your beneficials

56 GUIDE HEALTH

48 you’ll like these insects

58 HANSON ACRES Dale climbs back in the cab. That’s got to be good, right?

50 outlook 2015

Four new tractor series light up the 120- to 220-hp segment.

Let Marie Berry save you from saying, “Could you speak up?”

New field guide is your path to more insect control for less.

Flea beetles that eat spurge are on the first biocontrol wave.

Here are the pricing messages the market is trying to send us.

Our commitment to your privacy At Farm Business Communications we have a firm commitment to protecting your privacy and security as our customer. Farm Business Communications will only collect personal information if it is required for the proper functioning of our business. As part of our commitment to enhance customer service, we may share this personal information with other strategic business partners. For more information regarding our Customer Information Privacy Policy, write to: Information Protection Officer, Farm Business Communications, 1666 Dublin Avenue, Winnipeg, MB R3H 0H1.

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april 2015

country-guide.ca 3

desk EDITORIAL STAFF Editor: Tom Button 12827 Klondyke Line, Ridgetown, ON N0P 2C0 (519) 674-1449 Fax (519) 674-5229 Email: tom.button@fbcpublishing.com Associate Editors: Gord Gilmour Cell: (204) 294-9195 (204) 453-7624 Fax (204) 942-8463 Email: gord.gilmour@fbcpublishing.com Maggie Van Camp (905) 986-5342 Fax (905) 986-9991 Email: mvancamp@fbcpublishing.com Production Editor: Ralph Pearce (226) 448-4351 Email: ralph.pearce@fbcpublishing.com ADVERTISING SALES Sales Director: Cory Bourdeaud’hui (204) 954-1414 Fax: (204) 944-5562 Email: cory@fbcpublishing.com Kevin Yaworsky (250) 869-5326 Email: kyaworsky@farmmedia.com

Tom Button is editor of Country Guide magazine

The question of growth It was a question that went all around the table. I was in Illinois with a group of Canadian and American farmers, and the discussion leader kept track of all their answers on a whiteboard.

Here’s the question. In the last 30 to 40 years, how much has your family expanded the number of acres you’re farming?

There’s a reason for the time frame, since 30 to 40 years is roughly equal to a career. So the question was really asking, how much did the last generation have to grow your farm in order to put you in the position you’re in today?

Naturally, there were some outliers, and there was some scatter too, but not as much as I would have predicted.

But before I go any further, take a minute to figure out the answer for your own farm. Then guess the group average.

Got your answers? In case you don’t, let me take an extra minute to do a job that I too rarely do. As you know, ag publications are about as cyclical as farming itself. It’s why, during the winter, I often explain I’m just trying to hold myself together through what, in its way, is both our planting and our harvesting season.

Still, if the busy season comes, it also goes, just as fall comes to the farm.

As on the farm, too, when it goes, we get a chance to think about what went right and what didn’t go quite so right, and to celebrate the goals we achieved and pause over those we missed.

4 country-guide.ca

What I wanted to acknowledge is that none of it would be possible without the active co-operation of the farmers who talk to us not only about their farms, but inevitably about their families too.

I try to avoid inflated words, but really, their openness is amazing. Believe me, they don’t come knocking at our door. It’s entirely the other way around, and their generosity and their interest in helping the industry move forward is nothing less than a model to the world. They deserve all our thanks.

Now, back to our answers. It turns out that when you add the growth of owned and rented acres, commerical farms over that generation generally grew by a factor of four to 10 times, averaging about six.

The next question is immediately clear.

Do we still have to be on that treadmill? Obviously, a lot of very bright farmers think so, and they’re developing business plans to help get them there.

They believe robotics, telemetrics and genetics will make it all possible.

As for me, I think many of them will succeed, but so will well-managed smaller operations, especially if they deploy their business smarts more variously, both on and off the farm.

This summer, we’re going to put more thought into describing the agriculture of 2025. Care to make some guesses? Let me know at tom.button@fbcpublishing.com, and as always, let me know if you think we’re getting it right.

Lillie Ann Morris (905) 838-2826 Email: lamorris@xplornet.com Head Office: 1666 Dublin Ave., Winnipeg, MB R3H 0H1 Fax (204) 944-5562 (204) 944-5765 Advertising Services Co-ordinator: Sharon Komoski (204) 944-5758 Fax (204) 944-5562 Email: ads@fbcpublishing.com Designer: Jenelle Jensen Publisher: Lynda Tityk Email: lynda.tityk@fbcpublishing.com Associate Publisher/Editorial Director: John Morriss Email: john.morriss@fbcpublishing.com Production Director: Shawna Gibson Email: shawna@fbcpublishing.com Circulation Manager: Heather Anderson Email: heather@fbcpublishing.com President: Bob Willcox Glacier FarmMedia Email: bwillcox@farmmedia.com Contents of this publication are copyrighted and may be reproduced only with the permission of the editor. Country Guide, incorporating the Nor’West Farmer and Farm & Home, is published by Farm Business Communications. Head office: Winnipeg, Manitoba. Printed by Transcontinental LGMC. Country Guide is published 13 times per year by Farm Business Communications. Subscription rates in Canada — Farmer $41 for one year, $61 for 2 years, $87 for 3 years. (Prices include GST) U.S. subscription rate — $35 (U.S. funds). Subscription rate outside Canada and U.S. — $50 per year. Single copies: $3.50.

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Call toll-free 1-800-665-1362 or email: subscription@fbcpublishing.com U.S. subscribers call 1-204-944-5766 Country Guide is printed with linseed oil-based inks PRINTED IN CANADA Vol. 134 No. 7 Internet address: www.agcanada.com

ISSN 0847-9178 The editors and journalists who write, contribute and provide opinions to Country Guide and Farm Business Communications attempt to provide accurate and useful opinions, information and analysis. However, the editors, journalists, Country Guide and Farm Business Communications, cannot and do not guarantee the accuracy of the information contained in this publication and the editors as well as Country Guide and Farm Business Communications assume no responsibility for any actions or decisions taken by any reader for this publication based on any and all information provided.

april 2015

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Machinery

By Ralph Pearce, CG Production Editor

Only six months have come and gone since our last look at tractors in the 120- to 220-horsepower range, and yet the field of models, configurations and options has changed dramatically. In less than a year, three different manufacturers have launched new looks, new features and new designs in these smaller, yet durable lines. The other manufacturer is replacing an old favourite with a new series. In this size range, it’s increasingly a matter of looking for good things in smaller packages, with the four featured series displaying a full range of flexibility plus the capacity to deliver under almost any conditions on the farm. Even in April, there’s plenty to do that will keep these tractors performing above and beyond the call.

 Case IH Farmall 100A Series Non-farmers may look at value as a simple dollar figure. With the new Case IH Farmall 100A Series tractors, the company is promoting value as a total package proposition. Whether it’s for livestock or smaller-scale farming, the Farmall 100A boasts a redesigned cab, electronically controlled engine and a more economical drivetrain. According to the company, there are more standard features in this tractor than others in its class, including a faster throttle response, quieter operation and increased fuel efficiency, plus a Tier 4B/Final-compliant engine design. The new cab also comes with enhanced ergonomics and a new control panel, plus an available high-visibility roof panel that provides a clear sightline when carrying or moving loads.

www.caseih.com

New Holland T6 Series  With power and advanced technology, New Holland’s T6 allpurpose tractors series are manoeuvrable while providing superior comfort and visibility. Models in the T6 Series that fall within the 120- to 220-hp range, include the T6.155, T6.165, T6.175 and the T6.180. Two additional models (the T6.165 and T6.175) are equipped with the Auto Command continuously variable transmission. This series complies with the Tier 4B emissions standards, and its four-cylinder engine design means better performance with maximum power from each cylinder.

There’s also the option of augmenting the 52.2-gallon, high-clearance fuel tank with an auxiliary modular tank that gives you a total capacity of 58.6 gallons — enough for 12 hours of operation. The cab is also built for enhanced operator performance and includes improved visibility and a roof panel.

www.agriculture.newholland.com

6 country-guide.ca

April 2015

McCormick X6 Series 

John Deere 6R Series 

The new McCormick X6 Series tractor comes to market filling a very big space occupied by the successful X60 Series mid-range line.

It was launched at the 2015 National Farm Machinery Show, and has one of its two models — the X6.430 — in this small-but-effective horsepower range. With a Betapower 4.5-litre, four-cylinder diesel engine, the X6.430 can generate more power and torque, yet keep fuel consumption and emissions to a minimum. There’s also a fourwheel-drive front axle that comes standard, plus a fully locking front differential that engages simultaneously with the rear for true fourwheel pulling. And of course, operator comfort has been maximized, with an adjustable steering column, more comfortable seating and a window in the front roofline, improving visibility.

John Deere is once again refining its 6R Series tractors. With this launch, Deere is offering three small-frame models, with two of them falling within the 120- to 220-hp range. The 6120R and 6130R join this increasingly popular series, which builds on the premise of offering control and comfort combined with the compactness and agility to handle a variety of on-farm chores. These small-frame tractors also have additional selective control valves that have been moved further under the cab to improve visibility. Control components and the cab’s interior have been updated as well, making it similar to the environment inside the 7R, 8R and 9R Series. Other features include an IVT transmission, available premium lighting packages and increased service intervals.

www.mccormick.it

www.deere.com

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country-guide.ca 7

business

Star writer Married to an Alberta bison farmer, Jennifer Bain is food editor of Canada’s largest newspaper

By Steven Biggs, CG Contributing Editor Bain’s passion is exploring food, cultures — and farmers. “I can write about anything I want to,” she says as she talks about subjects that tie into food. Her interest in farming surprised some farmers. When she called one farm to ask for a tour, the owners thought it was very strange. “Who are you?

You’re a food writer?” they asked.

I don’t realize until the talk begins and Bain gets on the stage that I walked straight past her at the door, thinking she was the librarian who organized the talk. She’s very low key. There’s no puffed-up talk of trendy recipes. And even though this talk is about how she got into food writing and wrote her cookbooks, she weaves in stories about people.

Buffalo Girl on farming Bain figures we’re riding a wave of consumer interest in farms and farmers, and she says it was about 2008 when it really took off.

Earlier, city readers didn’t want to hear about farmers, or read columns that linked to the farm.

Now, talking to her Toronto audience, she smiles as she describes a Lays potato chip press release that made an impression by talking about meeting a potato farmer.

She also knows her own transition is only partly complete. “I’m a city girl so I still stumble over the language of the ranch,” she says, and when she tells the library crowd about corralling bison, she can’t remember the lingo for males and females. “The girl ones,” she says.

Bain knows enough about agriculture, though, to recognize that not all farmers are interested in dealing directly with consumers. That’s the case for her husband, for instance. But she does see opportunity for better outreach to consumers. She is looking forward to the Ontario Bison conference this fall, where she will cook and do a book signing.

Conferences for farmers, she thinks, can be an opportunity for her to connect with producers.

It makes me think that with all the effort that farmers say they are putting into making connections with key consumer influencers, maybe it’s a surprise that the food columnist of Canada’s largest daily doesn’t have farmers lined up at her door.

8 c o u n t r y - g u i d e . c a Ap r i l 2 0 1 5

Photography: Anne de Haas

had to buy a chest freezer when we were dating,” says Jennifer Bain. She pauses while the audience laughs. Then she continues telling us about writing Buffalo Girl Cooks Bison, her latest cookbook. She is Buffalo Girl. Her introduction to bison came when she married Rick, an Alberta bison rancher.

Bain weaves her own stories into the book, just as she does in her talk. The first chapter starts with her photo, in a cowboy hat, looking out over bison grazing on rolling hills. She writes, “We called him Blue Tag 741, for lack of a more personalized name.

He was the first bison on our ranch in Alberta that I watched move from field to corral, then slaughter to freezer, and finally stove to stomach.” That was in 2008, when she spent her maternity leave cooking bison at the ranch.

Bain’s talk tonight at a Toronto library is called “Eating for a Living.” As the Toronto Star food editor (her column is called “Saucy Lady”) and the author of two cookbooks, she earns her living telling stories about food and the people who produce, prepare, and consume it. Tonight she weaves her own story into her talk, telling us of her time spent as a journalist in Hong Kong and of her interest in crime stories.

business

Books Bain’s first book was the 2013 Toronto Star Cookbook, in which she features people and recipes that have appeared in her column. “The thing I love about the book is that there are a number of people in it,” she says as she describes farmers, chefs, and people who appeared in her stories.

For example, Eli, who comes from a Mexican, Lebanese, Spanish, and French background, shares his recipe for beef kaftas. Brothers Haroon and Jameel share their recipe for Afghanstyle kabobs. And Bain gives readers three ways to prepare fried eggs, saying, “During my stint as a brunch columnist, I ate restaurant eggs in every guise imaginable.”

B uffalo G irl C ooks B ison tells human stories too. Sharlyn and Ivan have a ranch in Red Deer, Alta., and Sharlyn shares her recipe for bison peroApril 2015

gies. She loves this food, which makes her think of her grandmother and her Ukrainian heritage.

Bain also tells readers about her unusual bison-related travels. She visits Jim Sautner in Spruce Grove, Alta., who has a pet bison that he drives around in a convertible. Knowing first hand that bison are large, wild animals, she makes her kids stay in the car for most of the interview. As the interview concludes, the bison head-butts the convertible and another nearby car.

Bain dishes up bison in many guises, including burgers, jerk-marinated steaks, bison borscht, bison bourguignon, and bison brisket braised in pomegranate juice. There’s even a recipe for Great Bison Balls of Fire (testicles.)

Evolving Food Landscape Bain has no trouble finding food stories. “In food it’s endless,” she says, adding that she has ideas from 15 years ago

that she still hasn’t been able to use.

Bain’s first food series at the Toronto S tar was her 1999 “Food Sleuth” series that looked at food from different cultures: Persian, Sri Lankan, Cuban, Korean, Portuguese, Eritrean, Peruvian, Maltese, and Somali.

I ask which of these have become mainstream. “Persian took off,” she says. “Korean really took off.”

I trawl through Bain’s recent Twitter posts to see what she’s been eating: Anatolian Turkish food, Uyghur takeout food. But there’s also a recipe for cocktail crisps made with the ubiquitous Maclaren’s Imperial cheese.

I’m curious to know what her next book will be about, given the ever-evolving food scene.

“Crime is my first love,” says Bain, adding, “I think I have to go back to writing about murder soon.”

Continued on page 10 country-guide.ca 9

business Continued from page 9

Everyday food Bain tells the audience that she doesn’t read food blogs or watch food TV. With three children, a busy husband — and her own job — she’s too busy.

“I grocery shop more than most people,” says Bain, who shops seven times a week. Rick commutes between Toronto and the ranch in Alberta, something that is possible because bison don’t need constant attention.

Later, when I visit her office (which is also the Toronto Star test kitchen) Bain pulls up chairs for us around the kitchen island. As I pull out my notebook, she turns away and starts texting.

Sitting down, she apologizes, saying her husband is making bison stew, and she texted him instructions so that the meat won’t be tough, like the bison short ribs he recently cooked.

I don’t see any food pretence in Bain’s kitchen. (She studied journalism, not food.) “I take a lot of reasonable shortcuts for home cooks,” she says.

She points to the tinned beans in her cupboard, which she says are a shortcut compared to using dry beans. I also see tins of yellow and black NoNamebrand chickpeas in the cupboard. In her T oronto S tar C ookbook , Bain says that she adapts recipes by replacing rare ingredients with common ones.

We talk about how she thinks when shopping. “I’m not a nutritionist,” she says, adding that she doesn’t scrutinize the nutritional data on food labels: “Everything in moderation.”

More important to her is where food comes from — and coming from Canada is a good thing. She holds up a bag of lentils and says that what she would most like to know is where they were grown.

Bain’s kitchen Bain’s office (really, her test kitchen) is electric. When there was no budget for upgrades, she got a tin of hot-pink paint.

Another year she installed red and black floor tiles in checkered pattern.

In her Toronto Star Cookbooks, she says, “What my test kitchen proves is this: you don’t need a showroom kitchen to cook well. You need great recipes and great ingredients.”

Bain has the kitchen for testing those great recipes. She writes, “Readers wonder why we test and adapt recipes. They 10 country-guide.ca

For Bain, reaching consumers boils down to one rule: “There always has to be a story.” assume that recipes from famous chefs and celebrities work, follow them slavishly and blame themselves when they bomb. They don’t realize that many talented cooks aren’t always great at writing recipes.”

The walls around Bain’s office-kitchen are hung with framed copies of her newspaper stories. We walk around the room and she tells me about some of them. One has a picture of a man holding cobs of corn. She tells me that it’s a 2003 story she wrote. It was about sweet corn and Thanksgiving — but also about the Mexican farm workers harvesting the corn.

Food and people During her library talk, Bain tells us about her 2011 series called “What’s for Dinner?” The idea was to look at the weekday eating habits of ordinary Cana-

dians by visiting people’s homes for dinner. Bain laughs as she recalls the flak she took from some readers for including pet cats in the story of the Shine family and the dinner they cooked for her. But the cats took centre stage while she was there. They licked the dinner rolls and ate on the kitchen island where the food was being prepared, and the love of the owners for their pets was part of the human side of the story, she says.

“It’s another way to present a story,” Bain says of what she looks for in a recipe. For example, if she writes about a restaurant, she might cook with the chef.

Food alone rarely makes a story. “There always has to be a story. The recipes have to connect to a person,” she explains.

It sounds like a lesson for agriculture, I tell myself, realizing I have already decided to read her next book. CG April 2015

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business

Time to be a game changer

By Maggie Van Camp, CG Associate Editor

The year is at half-time, and you’re the coach. Most of the crop is in the ground, the spring rush is coming to an end, the team is winded.

It’s a time when you can make a difference. You can be in charge; you can draw up new plays, analyze your strategy and motivate your players.

You can be the game changer for your farm business, re-committing yourself to your game plan and picking the right business priorities for the second half of the year, starting now to take the steps that will make it all happen.

You can also be the one who observes, listens and notices.

Here are five big ideas for your clipboard this summer, and some preplanning tips and ideas to get you started.

In sports, they say championships get won in the off-season. Heck, in farming these days, it’s the playoffs all year long.

Match equipment to your land base Matching your equipment to your land base requires you to somehow balance the benefits of timely operations against the costs of excess capacity, all in the midst of fluctuating grain prices and unpredictable weather.

All spring, you’ve been walking this tight rope between efficiency and cost, so now is a great time to at least begin thinking about trading up or scaling down equipment, or even acquiring more land.

Before you make any decisions, though, it’s good to benchmark against other farmers and look at your machinery relative to your investment in land. When Ted Nibourg, Alberta Agriculture and Rural Development business management specialist in Stettler, analyzed Statistics Canada data for Alberta, he found Alberta farmers’ machinery investment as a percentage of total farm capital has dropped almost linearly from a high of 17.87 per cent in 1998 to a low of 10.45 per cent in 2013. Machinery investment as a percentage of land and equipment went from 24.81 per cent in 1998 to 12.36 per cent in 2013.

“I strongly suspect the percentage change can be attributed to increased land prices,” Nibourg says.

A better benchmark for managers to consider may be their machinery investment per acre divided by the long-term average gross revenue per acre.

This ratio is a good guideline to start sizing equipment to acres. Economies of scale and higher commodity prices help reduce the ratio, although poor weather can increase the ratio in the short term.

12 country-guide.ca

The long-term average for Alberta farmers is 1.59 for crop producers, ranging from a high of 2.29 in 2003 to a low of 0.88 in 2012. This means the average farmer in Alberta has $1.59 to $2.29 invested in machinery for every $1 they receive in gross revenue annually.

As a guideline, your machinery investment should not exceed 2.0 times your gross revenue per acre, says Nibourg.

Nibourg also takes it a step further. The current average ratio of 1.59 with average gross revenues of $250 per acre means the machinery investment is $397.50 per acre.

When you include depreciation at 10 per cent, this results in a machinery fixed cost of $39.75/ acre.

Increased crop returns, the lack of systematic machinery replacement, and increased farm size have impacted this ratio, says Nibourg.

For livestock producers, the long-term average ratio is 1.09, ranging from a low of 0.8 in 2001 to a high of 1.28 in 2013. The overall lower ratio in the livestock sector can be attributed to a lower machine requirement, says Nibourg, who adds, “The ratio increase will likely reverse itself with the increased returns experienced by the livestock sector during the last two years.”

It’s important to consider your ratio over the long term because short-term variability can result in a misdiagnosis of machinery requirements. The overall ratio may also appear favourable but a weak link could show up in a critical operation.

“Machinery evaluation should be ongoing and done operation by operation,” says Nibourg.

April 2015

business

Time to get to work on succession, instead of worrying about it Before you call the lawyers and accountants, before you change your will or form a corporation, and even before you have a big family meeting and bring in a succession planner, take some time to gather your thoughts about succession.

Make the transition from wondering about farm transfer to actually thinking about it. Maybe crunch some numbers and start talking with your family.

Grant Robinson, national director of BDO’s SuccessCare Program says it helps the process if you take some time to figure out what you’d like the future to look like. Then talk to your kids about your vision, and discuss some ways to resolve the factors that may stop you from achieving it.

Robinson suggests you start with a workbook he helped develop, which you can find under the succession/business transition tab at www.takeanewapproach.ca. It may help you formulate a vision.

Think about what you’d like to see for the business in 10 years (i.e. two truck-leases) for the ownership and for the family. Then write it down. Robinson has found that by getting farmers to think in these time frames, they aren’t too intimidated, but it still keeps the process going. It’s a short enough time to give it a sense of urgency, yet long enough not to stress it into a stall.

Besides, almost everyone has worked with five-year plans for their business, so they understand what these horizons might look like. A decade is a long time, and a lot can happen.

Start by figuring out what you need and want, and talk with your spouse about what you want that retirement to look like. Then, again, write it down. This will also help you get a good understanding of how much you’re going to want to live on in your retirement, Another part of that discussion is considering what role you’d like to continue to have on the farm, and how and when you’d like to transfer management and financial control.

Once you’ve sorted out what you want, you need to share this vision and receive feedback from all your children. “I am a believer in getting the stakeholders engaged and identifying what needs to be done before you start with the technical,” says Robinson.

State your vision. Then listen. Is it clear you want a common outcome? Does the next generation really want to farm, or do they really just want to maintain an emotional attachment to the home farm? Maybe they just want the assets so they are equal to their siblings. These are very valid concerns and can be resolved in many ways, not just via farm ownership.

Everyone also needs to understand the difference between estate planning and succeeding a business. “A business is not like my grandfather’s watch. I have my grandfather’s watch in a frame mounted on the wall. You can’t do that with a business,” says Robinson.

Next, it’s time to sort through the things that will stop you from getting to the outcome you want, and what needs to be done to get results. This introduces a dose of reality for many families.

After you explain your vision for the farm, ask what your children want for their future. What are their priorities? Do they just want the land or do they want to try a different production system? Their ideas, hopes and fears might surprise you.

You might want to share some cash-flow statements and the average over many years so everyone understands the reality of the farm as it April 2015

“ I am a believer in getting the stakeholders engaged and identifyng what needs to be done.”

— Grant Robinson, BDO stands today. One way to sort out the difference between emotions and thoughts is to ask your children directly. If they want the farm, would they be willing to buy the assets? What they can afford to pay for them.

Then you have a starting point unshackled from entitlement or guilt.

Although you love all your children equally, they’re not all likely to be equally good successors or to want the same thing.

This is a time to listen and look for solutions. These conversations should help you decide how you might make your vision a reality, or if you have to tweak it or start again.

“Always honour the family first, the relationships, the traditions and culture, before the business,” says Robinson. “The business is separate.”

Some children get stuck in what Robinson calls “the golden handcuffs,” inheriting a farm and traditions that don’t allow them to do what they want to do with their lives. They work on their parents’ farm for years providing sweat equity and giving up on other opportunities. And when their parents die, the farm is split up equally among the siblings. Bitterness eats away at the family. “If parents are going to make this decision, they need to talk about it with their children,” says Robinson.

Get better at communication Although communication between individuals can always be improved, the real goal, says farm family communication adviser Richard Cressman from New Hamburg, Ont., is to determine if your current communication level is acceptable.

For a farm business, Cressman says, communication is all about achieving the most effective movement of critical information needed for the business to profitably function. One way he assesses whether communication is working on the family farm is by asking if anyone feels or thinks that they do not know everything they need to know about how the business is running.

“Information must move amongst everyone who needs to know,” says Cressman. “Everybody in the business or in the family will tell you if they think this is happening effectively or if there are big gaps in the system.”

To drill down to the problem, he asks members of the family farm the following: • Do you feel you are being listened to?

• Is your input acted on?

• Are there decisions where you think you should have input and do not?

• Could you do a better job of sharing information?

The solutions can be as simple as organizing regular meetings, or as high-tech as accessing cloud technology on smartphones. Moreover, what works well in one situation may not be even tolerable in another. For example, Cressman knows of situations where the two farming principals get along very well, but their spouses haven’t talked for years. There are hardly any extended family get-togethers.

They lead separate lives away from the farm business. Yet it works.

Continued on page 14 country-guide.ca 13

business Continued from page 13 Each family is unique, and while there are strategies that will work across the board, they need to be tailored and customized for the individual nuances and the different personalities of the family and the business, says Cressman.

Phone calls and text messages also can exchange information effectively. Cressman has worked with two managers who exchange information using an Excel spreadsheet stored in the cloud. Each of the managers can access this information from their cell phones and move a lot of information back and forth without actually talking to or texting each other. They’ve also evolved this to allow specific outside advisers to access this spreadsheet.

If incorporation is in your future, start checking the grapevine now for the best lawyer to do the job A low-tech solution is a whiteboard on which different individuals can post information, without needing to talk to each other. For example, Cressman has worked with a family farm with three principals and they have six whiteboards scattered strategically around the buildings, throughout the barn, milking parlour and office area. On another farm a couple of decades ago, Cressman suggested putting a white board in place to track time off for the owners and employees. It’s still being used.

A common way to improve communication is with meetings, but their format can vary based on the situation. For example, Cressman will have some families sit down every four to six weeks for a business meeting. Another family he works with connects on three-way or four-way phone calls once a week. “There is no magic and there is no perfect way to have meetings,” he says.

Wondering about incorporating?

Before you jump on the farm corporation bandwagon next winter, you probably should take some time to think about how it might work on your farm, learn more about it and book some outside help.

To better understand the basics about corporate structure and to decide if incorporation makes sense for your farm business, check out resources such as the Ontario agriculture ministry’s factsheet called “Farm Corporations” at www.omafra.gov.on.ca/.

Farmers should be talking to their accountants to find out more about these technical issues and whether it makes sense to incorporate. “Things can get pretty complicated depending on the situation,” 14 country-guide.ca

says Tom Blonde, chartered accountant and partner in Collins Barrow in Elora, Ont. A financial analysis into whether the costs would outweigh the benefits of incorporation is key. To do this, you need to determine how much you are paying in tax now, including benefits like the Canada Child Tax benefit that you may not be receiving because your income is too high, versus how much you could save with a corporation net of the additional costs and complexity of having a company.

You’ll have the additional costs of more paperwork and filing corporate as well as personal income taxes. Also, after incorporation, you’ll need to contact all your customers and suppliers to ensure that payments and invoices are now made out in the name of your company rather than your old proprietorship or partnership. If invoices are not in the company’s name, the CRA may deny deductions to the company and/or include company income as personal income.

You might also find value in talking to a friend or a neighbour who has recently incorporated. However, every farm incorporation situation is different and your neighbour may have either a more complicated or a simpler corporate structure than you might need.

This summer might be a good time to ponder some of the logistics of how a corporation would work on your farm. “It is not always necessary or desirable to transfer all proprietorship or partnership assets to your company. This applies particularly to land, homes and marketing quotas,” says Blonde.

Now is a good time to get a grip on future plans for the properties. Before creating a plan to handle assets in or out of a corporation, know if you have used up your farm property capital gains exemption and if you need to roll properties in so you can write off interest and principal in the corporation.

If farm assets are put into a corporation, there’s less flexibility in transferring them to the next generation at less than fair market value and it’s more difficult to access your capital gains exemption in the future. Transferring these assets to the company could impact your personal income tax and any social benefits you receive, such as the Canada Child Tax Benefit. Also, if you transfer your personal home to the corporation, you will lose your principal residence capital gains exemption and be subject to a personal taxable benefit for the use of corporate-owned property.

However, these negative consequences may not matter in situations where you have maximized your capital gains exemptions or have no desire to transfer assets to the next generation. Also, if you want to transfer debt to the corporation, you’ll have no choice but to transfer enough assets to be able to assume this debt.

If you’ve decided to go ahead and incorporate your farm next winter, now is a good time to think about when you want to do it and who should do the legal part. You also might want to consider who would be your company’s directors and officers.

For more thoughts on considering incorporation check out Blonde’s article www.collinsbarrow.com.

April 2015

business Prepare for life’s inevitable changes When everything is growing in the field, the last thing that comes to mind is your death, but we all have expiry dates, we just don’t know when. The mess left to clean up after poor estate planning can leave children and surviving spouses battling, and all of their inheritances in jeopardy.

So the time to begin estate planning is now, no matter how old you are. If you don’t have a will or if your personal situation has changed, now is the time to think about it and take concrete steps.

Book an appointment with a lawyer next winter to get it done.

For many families, joint ownership and beneficiary designation, combined with a simple will, can do the job. Property such as bank accounts can easily be placed in joint title to pass to the survivor

automatically. Sometimes it can take more, but at least start with a basic will.

The hiatus between seeding and harvest is a perfect time to think about naming your beneficiaries, including charities that mean a lot to you, and how you’d like the assets handled. With business owners, it’s really important to select someone to be your power of attorney, which allows a selected person access to assets and bank accounts in case you’re alive but are mentally incapacitated.

Similarly, you can select someone to make health-care decisions. A preferred health care document, commonly (but not legally) called a living will, assigns a person if you’re incapacitated, although it’s handled and called different things in different provinces.

Although writing a will or thinking about your estate may not be your favourite activity for a summer afternoon, take some quiet time to think about how you’d want things

handled when you’re gone. Add in the complications of owning and operating a farm business, second marriages and blended families, because you need a plan worked out thoughtfully.

Then there’s the much-needed sharing information and other wishes with your family. Jolene Brown, a popular speaker, farm business adviser and farmer from Iowa, created a list of questions about how the farm operates and what the person wants. (whatever you do, write out your passwords and tell someone where this list is). For the full list go to www.jolenebrown.com.

Another idea to pursue this summer is writing an ethical will or a legacy letter.

It’s not a legal document, but rather a way to share your life lessons, hopes and love, forgiveness and dreams for the future. Some are read at funerals, others are distributed while alive or at death.

This can work really well with farm families, says Grant Robinson. For more on this, check out www.ethicalwill.com. CG

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business

Their joint path to

succession

16 country-guide.ca

April 2015

business

By Maggie Van Camp, CG Associate Editor

“Succession planning here is like hitting a moving target,” says Jim McGregor, but it’s also the family’s greatest opportunity mile from the Ottawa River, the McGregor family has lived and farmed, and they have loved and built for five generations, to the point where their produce business has mushroomed to 15 stands, a pick-yourown business and four farmers’ markets.

Theirs is a story about embracing change, and about how, in the midst of all that change, to tackle the sometimes difficult challenges of succession planning.

That in turn means theirs is also a story of a deep commitment to family communication, and a story of tying it all together with business agreements.

“We are always looking at opportunities,” says Jim McGregor of Braeside, Ont., an hour up the valley from the nation’s capital. “We are ideas people.”

It’s that attitude that spurred his own succession back in 1977, when he and his wife Ann moved back to be near his parents’ 100-cow beef farm. That year their first child was born and the young family grew three acres of sweet corn.

By the 1980s, they were also growing strawberries and beans, selling wholesale and going to one farmers’ market.

Jim and Ann both worked off as well as on the farm, and they had their parents’ support, including from Jim’s mother, who worked in a legal office and always believed farming should be a business-like profession. So as early as 1979, they wrote formal work agreements, even when hiring other family members.

April 2015

Celebrating their joint venture, Ian (l), Jim and Cameron get ready for a new season.

It soon became a way of doing things that would carry them through the next generational turnover relatively unscathed.

Currently, Jim and his sons Ian and Cameron have a three-way joint venture agreement, with each owning separate assets. A joint venture is an undertaking between parties to pool resources and share in profits, so that with a clear agreement like the McGregors’, the individuals own the assets and share the revenues that are left over after expenses.

A joint venture doesn’t require a separate business number, however. Nor does it own anything, or require the parties to file income tax together. And unlike in a legal partnership, the parties can’t act on behalf of each other.

The joint venture agreement is simply the guideline for the parties to work together over a specific time, usually with shorter renewable terms that you might see in other agreements.

Increasingly, joint ventures are also being seen as a great way to bring in the younger generation without creating legal problems if it doesn’t work out.

The other core belief that has continued guiding the McGregors through this generation is that it is important for the next generation to get an education and work away from home for a while before coming back to the farm.

Ian and his wife Deb both have agricultural degrees from Guelph, Cameron has a degree in criminology and his wife Mandy is a nurse working off the farm at Hos-

pice Renfrew, and the McGregors’ daughter Sarah and her husband Randy Briscoe own and operate a dairy farm nearby.

Succession: Phase 1 Both Ian and Cameron worked off the farm for a year or two, with Ian coming home to farm in 2001, bringing with him a passion for production. After a few years of working on salary for the farm, Jim and Ian created a joint venture agreement so that each of them received half of the profits on the produce.

Also, Ian and Deb along with Jim and Ann bought Jim’s parents’ place, the home farm.

While making this transition, the three generations identified three objectives.

First, the grandparents needed to be paid quickly. Second, they all wanted to minimize how much Ian and Deb needed to pay for the land because, like most beginning farmers, they were short on that kind of cash. Third, Jim and Ann wanted to retain some ownership.

Their solution was for Jim and Ian to split the purchase 50:50. Jim and Ann paid his parents for half while Ian and Deb paid for the other half slowly over a set term with no interest.

Again, although they hashed out the ideas, they had a lawyer write up a formal agreement, which included a provision giving Jim and Ian first right of refusal if the other one decided to or was forced to sell.

Continued on page 18 country-guide.ca 17

business Continued from page 17 For the farm to be able to afford to support two families, the McGregors knew they had to expand. “You can’t take two salaries out of a business that grosses only $100,000 a year,” says Jim. “Our major objective then was to increase gross sales.”

So they started going to more farmers’ markets, they expanded the pick-yourown strawberry business and added raspberries and aspargus. They also expanded their rental acres, and Ian led the way into grains and oilseeds, which proved useful rotation partners.

As long ago as the 1990s, British

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business researcher Matt Lobley looked at surveys from around the world and consistently found a phenomenon he named “The Successor Effect.” Having a successor provides incentive for expansion and forward planning, he discovered, and these changes are often driven by the new ideas and vision that the younger generation brings back to the business.

At the McGregors’ farm, Ian and Cameron brought home the idea of “plasticulture,” using plastic to extend the growing season and keep the weed population in check. Today they use black plastic to cover rows of strawberries and tomatoes and have adopted drip tape irrigation. They

plant beans and corn through clear plastic, and use row covers to protect early crops.

The boys also encouraged Jim to invest in agronomic advice. At first he was reluctant to go for the additional expense, but he became fully committed when he saw the benefits.

Ian and Cameron also brought home the business-altering idea of hiring offshore labour. It was a difficult decision at the time, says Jim, but a necessary one. Eight years ago they were depending solely on local help when in the middle of the season, one key employee family suddenly did not show up.

“We nearly killed ourselves working

that summer… and we didn’t get all the work done,” says Jim. Today, they hire 20 Jamaicans and 30 local students. Ian’s wife, Deb, schedules this labour force and does the farm’s marketing.

And Cameron makes three In 2006 Cameron returned home to work with the business. McGregor’s Produce had grown and was selling at six farmers’ markets in addition to their successful stand at home. Once again, however, they knew they would have to expand to accommodate another family.

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business Continued from page 19

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The next year, the McGregors started adding satellite stands in nearby towns, and today from mid-June to Labour Day, their crew of hired students drives their freshly picked produce to 15 locations throughout the Upper Ottawa Valley that sell directly to the consumer.

“ The three of us can do more by working together,” Jim says.

“There’s a synergy.”

Cameron and Mandy bought the farmland surrounding Jim and Ann’s severed house. Again, Jim and Ann offered a break in the price and they hold the mortgage. Then last year, Cam and Mandy bought another farm where they live. It is being tile drained and they are planning to grow crops that will complement the current business.

Currently, McGregor’s Produce grows produce and crops on the twothirds of their 1,000 owned and rented acres that are tillable.

In 2008, Cameron became an owner in McGregor’s Produce with the help of a new joint venture agreement, this time with 40 per cent of profits going to Ian, 20 per cent to Cameron and 40 per cent to Jim. In subsequent years, Cameron’s portion increased five per cent and Jim’s decreased five per cent until Jim reached 20 per cent.

Now, the written agreement will stay for the foreseeable future or until things change again.

As the next generation moved into ownership roles, sales increased dramatically, says Jim, who now is retired from the school system and spends a couple of months each winter in Florida.

Indeed, Jim now sees the arrangement as almost a magnet for opportunities, especially in the context of trusted, long-standing relationships in the community.

“The enthusiasm and energy of the younger generation combined with the experience, financial stability and confidence of the older generation have allowed us to do so well,” says Jim. 20 country-guide.ca

There WILL be disagreements The reality is that you’re not going to agree all the time. In fact, says farm family communication adviser Richard Cressman, it’s actually important that you don’t all think alike.

Yet it’s essential that you learn to fight fair, says Cressman, based in New Hamburg, Ont. All discussions need to be transparent, respectful and confidential, and everyone needs to recognize, for instance, that nothing destroys trust like hearing from a neighbour what was talked about at a family meeting.

Cressman says adherence to the following principle may be the most important attribute of successful families: “Disagreements will happen. Someone may leave a meeting in a huff. That will happen from time to time. However, they’re all expected to come back to the next meeting willing to participate.”

There should be a clear distinction as to who has input into what discussions and decisions, yet everyone’s voice is important. “Cultivate an attitude that your meetings are an integral part of the future success of the business,” says Cressman.

And remember, if there’s stress and conflict in your family, Cressman says, it will almost inevitably have originated in a lack of effective communication at some point in the family system.

Communication, he says, is exactly that high value.

Open communication The transfer of management within the McGregor clan has been fluid and ongoing. “The three of us can do more by working together than if we each worked alone,” says Jim. “I can’t explain it, but there’s a synergy.”

Ian is the keen agrologist of the family while Cameron is a real people person who enjoys working with the staff, yet all three owners can do everything on the farm so they cover for each other.

The emphasis, though, is on mutual respect. “The boys are quite capable of making decisions,” says Jim. “They have more knowledge about farming than I do.”

That also means meetings. The

McGregors have formal family business meetings including spouses, plus formal farm council meetings with all family members including Sarah and Randy, as well as less-formal farm management meetings where the day-to-day decisions are made by Ian, Cameron and Jim. The management team also has periodic formal meetings where they review financial statements, dig into strategies, and look at ratios, cash flows and key costs in their operations.

Although they don’t always have the same ideas, they always are able to openly discuss each idea and agree on a decision in the end.

At least annually, the McGregors have a farm council meeting where they discuss bigger-picture decisions for the April 2015

business farm and family, such as risk management, wills, and medical coverage, and where they also celebrate achievements.

Len Davies, the farm financial adviser they hired three years ago to help them through the succession process, had the whole family take personality tests. This awareness has helped them communicate better. “The three of us are a lot alike but different,” says Jim. “Knowing our strengths and personality weaknesses can help the business and help each other by building on each others’ strengths.”

For the McGregors, having Davies at their formal meetings isn’t about keeping the peace, it’s about sourcing new ideas and tapping into his resources. “We discuss things thoroughly all right, but

there’s never any shouting. That’s just not the way we operate,” says Jim. In that spirit, the McGregors also have family business meetings several times a year which include the spouses.

These meetings are for making more strategic decisions, such as creating a mission statement, deciding whether to go to a farmers’ market on Sunday or even whether to have the farm operating on Sundays, all to help maintain some family time.

Such discussions have shown Jim and Ann how committed their children are to family values, something they respect greatly. The younger generation wants to book time off to be with their family, whereas Jim says his generation thought

they needed to stick close to home so they could be working all the time.

These meetings follow strict guidelines regarding frequency of meetings and who attends, and the family sets an agenda ahead of time and keeps minutes.

For such meetings, the McGregors have a “no-children” allowed rule to ensure 100 per cent engagement from everyone.

Although sometimes it’s difficult to schedule these family business meetings because each family is so busy with three children, everyone knows how important it is to the business. “Talk face to face with all the players,” says Jim. “Spouses need to be a part of the business team, especially on the philosophical decisions.” CG

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country-guide.ca 21

business

Who are they really?

Personality testing can be a surprisingly easy and useful tool in your farm business ave you ever wondered why one family member considers it the end of the world when another family member leaves an empty water bottle in the combine?

Or why, knowing this, another family member will check the cab and toss out the offending bottle in order to keep the peace, while another family member will dramatically throw up his hands during a meeting, as if to say, “Oh, brother, what a waste of time working with people like you who just don’t get it!”

In one version or another, these are scenarios that most farm families are familiar with because, according to Gordon Colledge, a farm adviser in Lethbridge, Alta., they demonstrate the different basic personality types.

Colledge uses personality tests like True Colors (www.truecolorsintl.com) to help families work together more effectively. In its approach, True Colors uses four colours to identify distinctive perspectives and personalities. Most of us have a dominant colour and are influenced or shaded by the other three colours, which gives us our spectrum.

working with farm families, the system helps him determine everyone’s personalities and their needs, along with the stressors and joys that go with each personality type. Family members also come to better understand each other, which in turn leads to better communication and less conflict, he says.

Doing the personality assessment as a group with a trained facilitator is even better, he says, helping everyone see the impact of personality on how different family members will react in different situations.

Boissevain, Man. farm family coach Elaine Froese agrees that these types of tests can be useful. She is certified to use the CRG Personal Style Indicator assessment tool. After using it with clients, she has heard them exclaim, “I wish I would have done this 10 years ago.”

According to its website www. crgleadergroup.com , CRG claims its 20-page Personal Style Indicator assessment will help you discover your inherent personal style and natural preferences towards time, people, tasks and situations.

The site says it will also help you become more aware of your typical reactions to

Eliminate friction, connect the right people with the right jobs, and work better together “When I use it, there are fewer arguments,” says Colledge. Other family members learn that the “Gold” personality needs organization, lists, rules, and punctuality. The “Orange” likes to wing it, working out the details as they go along. “Blues” are true and loyal, hate conflict, and will exhaust themselves trying to keep the peace or put out fires.

The “Green” is like Spock in “Star Trek,” logical, pragmatic, and showing little or no emotion.

If it sounds like pseudo-science, Colledge begs to differ. He says that when 22 country-guide.ca

stress, determine your preferred work environment, and know your strengths and challenges while also improving your understanding of others’ tendencies.

These are just two of the personality tests available for farm use. There are others too. Michelle Painchaud, CEO of Painchaud Performance Group in Winnipeg, Man. likes the tools that are based on a large pool of responses like the one offered by Profiles International (www.profilesinternational.com).

Painchaud says these psychometric assessments are a very valuable tool in

By Helen Lammers-Helps

understanding an employee’s thinking and learning styles as well as their behavioural traits. They are useful for hiring and also to help understand and build teams, she says. “They can be really helpful because we all think differently; our brains are different.”

There are also self-reporting types of personality assessments that you can do yourself. Froese has one on communication styles that she hands out at her workshops. (It’s also available by emailing her at elaine@elainefroese.com and putting “communications style” in the subject line).

“Some people find them helpful,” says Froese. “It makes them become more aware.”

Mike Bossy, president of Bossy Nagy Group in Tillsonburg, Ont. uses the Kolbe A Index personality test ( www. kolbe.com). He first took the test himself when he was a participant in a coaching course. “It was a big aha! moment for me,” Bossy says. “It described how I took action perfectly.”

Like many of the personality tests, the results classify people according to their dominant personality style. In the case of the Kolbe A Index, the categories are Fact Finder, Follow Thru, Quick Start and Implementer.

Understanding your dominant action modes helps families work together, says Bossy. “By understanding your natural inclinations you can work around them.”

Bossy adds that it’s important to remember there are no bad scores: “All personality styles are equally valid. All kinds of people are needed on the team.”

Bossy also says there are many ways to use the test results. They can be used to reassign responsibilities according to each person’s strengths. For example, someone who is a Quick Start isn’t the right person to buy the tractor. That job should go to someone who is more analytical, he says.

Continued on page 24 April 2015

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business Continued from page 22 If your books and files are a mess, likely the person doing them is lacking in the Follow Thru category. “Hire someone who will make up for this,” says Bossy.

By understanding your own natural inclinations, Bossy says you can create habits that help you overcome your challenges. For example if “Follow Thru” is not one of your strengths, create artificial deadlines for yourself, he says.

This insight can also be used to improve personal relationships. Bossy tends to be impulsive so he has put a habit in place to modify his instincts: “Now I always check with my wife before accepting a dinner invitation.”

Bossy has also used the personality assessment tool to help young people sort out their best career options.

Yet personality assessments have their drawbacks as well. Painchaud cautions there are many options available, and if someone doesn’t truly understand how to find a scientifically

validated assessment, they may end up with a useless and potentially disruptive assessment.

Painchaud also has concerns about the self-reporting type. The problem with these, she explains, is that people may not have an accurate self-perception. She warns that if the self-reporting kinds of assessments aren’t handled appropriately, things can go bad. “They can create animosity,” she says.

Wendy Sage-Hayward, is a family enterprise adviser with the Family Business Consulting Group and adjunct professor at the University of British Columbia’s Sauder School of Business.

She also sits on the board and is a shareholder in a large multi-generation familyowned hog farm in Iowa. She is certified to use the Insights Discovery Personality Assessment (www.insights.com) which she has used with people at all levels in business including front line staff, executive teams and boards of directors.

“The assessment gives you a framework and a language to talk about things,” Sage-Hayward says. “The

downside is that labels put a person in a box.” The other problem, she says, is that no tool can describe the full complexity of humans.

The issue of creating labels for people is the reason Pam Paquet, a psychologist and business coach in Port Coquitlam, B.C. has shied away from using them with groups. “While they can be useful to help an individual become more self-aware and change their behaviour, when it comes to families or groups, people often use the results as an excuse for bad behaviour,” she says.

The purpose for the tests should be to create change but they don’t seem to work that way, she says. “Once people have the results, there doesn’t seem to be an impetus to keep going,” she explains.

Colledge agrees that the personality assessment works best when people look at the areas where they are weak and focus on those. “You can’t change your personality,” he says. “But you can change your behaviour.” CG

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April 2015

business

Team building on the farm It might seem something only office workers should waste their time on, but team building fits farming too

By Helen Lammers-Helps

he options are endless. Companies send their employees out rock climbing. They hire fancy consultants to host trustbuilding days. They send their executive boards fly fishing, or arrange a day of more traditional community service work where everyone can work side by side and roles are often reversed.

Less adventurous businesses can even do the traditional with a golf tournament or company picnic.

But on the farm? Really?

Although it may seem very modern, the idea behind team building actually dates back to research from the 1920s. Over time, however, it has evolved from a general objective of improving interpersonal and social interaction among team members to paving the way for measurable progress on important goals and tasks.

Jolene Brown, a farm business consultant and farmer from Iowa who regularly speaks and consults in Canada likes to use a sports analogy when describing the ideal farm team. As she puts it, strong team performance starts with (1) a good coach, (2) having the right players in the right positions, (3) everyone knowing and sharing a solid game plan, and (4) regular practice.

Team-building activities are geared to optimizing all of these facets. They can foster team members getting to know each other better, and they can improve communication between team members. They can also help employees work better as a team instead of individually, and help them adapt to change or simply boost morale.

Most importantly, the team must be built on a solid foundation of communication, trust and accountability, says Gordon Colledge, a farm adviser in Lethbridge, Alta.

Michel Painchaud, CEO of Painchaud Performance Group in Winnipeg says team-building exercises can be very useful if (and she says it’s a big IF) the exercise has a clearly defined expected outcome.

“Don’t do a team-building exercise for the sake of building the team,” Painchaud says. For a teambuilding activity to be successful, you have to understand what it is that you are trying to accomplish, and you need to select the tool accordingly, she says.

“Each employee’s style should be taken into consideration before a team-building event is selected,” Painchaud says. Otherwise some team members may not be receptive to the activity.

April 2015

Some managers think a barbecue, bowling or a pizza party are great ideas but your employees may not agree, she explains. “What you think is fun may be painful for others.”

Besides, sometimes it isn’t team building that is really needed, she continues. Sometimes the problem is conflict, so what’s really needed is conflict resolution coaching. Or what’s needed may be a strategic planning session to get everyone on board.

Sometimes having a workshop using a personality assessment tool with a trained facilitator can be a good team-building exercise, continues Painchaud.

The important thing is to be clear on what you are trying to accomplish.

Wendy Sage-Hayward, a family enterprise adviser with the Family Business Consulting Group and a professor at the University of British Columbia’s Sauder School of Business agrees that team-building exercises are useful when carefully chosen to match the goal.

Activities can vary from fun activities geared to create cohesion and connection between the generations to more serious developmental workshops, Sage-Hayward says. There are many activities available on the Internet, she adds.

It’s important to choose activities that are appropriate for the target group. “I wouldn’t use the same exercises to create cohesion among a multi-generational business that includes children as I would with a board of directors,” she explains.

For example, when Sage-Hayward was working with a multi-generational automotive family business that included children aged seven to 15, she had the family members break into teams to build a Lego car kit. It was an enjoyable activity intended to make meetings fun for the kids and to increase cohesion between the generations, she says.

One of the activities that Brown has used involves having participants work in teams to make the tallest tinker toy tower that they could make in seven minutes. The exercise demonstrates the importance of leadership, communication and teamwork, she says.

Some “grow” the tower too fast without building a proper base. Others spend so much time on the base that there is no time for growth.

Kristi Nylen-Burns, one of the owners at Windy Poplars Farm, a cattle and grain farm in Wynyard, Sask., uses team-building exercises at their quarterly Continued on page 27 country-guide.ca 25

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owner-operator meetings. “We use the team-building activities to start the meeting off on a lighter note,” she explains.

One of the exercises Nylen-Burns created involves giving two equivalent sets of Lego blocks to each of two teams. The teams had to build a machine which was judged according to criteria such as: Does it do work? Does it perform more than one function? How well did we work as a team?

Points were awarded for each category and each team voted on the criteria.

This allowed for honest self-reflection as well as an opportunity to see the merit in someone else’s work (e.g. the creativity, esthetic appeal, functionality, etc.).

“It was both fun and engaging,” says Nylen-Burns who adds that it’s important to have a good understanding of the people who are participating so that the exercise is inclusive. “Ideally you want people turned on and tuned in, not feeling self-conscious or awkward.”

Other ideas and resources can be found on the Internet, including at www.mindtools.com, where you can search for team-building advice and techniques.

One tactic Colledge has seen work effectively for team building is to take the annual meeting off site to a room at a restaurant or a hotel. “Providing lunch and getting away from the farm helps to develop a common approach with common goals,” says Colledge. It encourages people to work in a more professional manner than they would if they were sitting around the dining room table at home, he explains. One farm family, he says, had a successful team-building result when they took their annual meeting to a hotel with a water slide. They also included a family council meeting to deal with issues relating to the family as a whole.

Richard Cressman, a farm communications adviser in New Hamburg, Ont. finds the challenge when working with farm families is that the issues tend to be similar from family to family, but the uniqueness of the personalities and the situations almost always demands a unique approach for each family.

Cressman says he is always working on team building but it isn’t stuff you’ll find in a textbook. “The central premise to everything I do with families is that you cannot make or hope that someone else is going to change,” Cressman says.

“You first need to start with working on yourself and then start to address the big picture.” CG

C-52-03/15-10287626-E

country-guide.ca 27

business

A place on the farm

Is Charlene Bradley a template for a new generation of farmers?

orking in the grain industry had seemed an unlikely choice for Charlene Bradley. “If someone had said to me in Grade 12 that I’d be living on a farm and managing a grain elevator,” she now says, “I would’ve looked at them like they had three heads.”

After all, growing up in Edmonton didn’t provide much exposure to agriculture. Probably it provided even less exposure than farmers might think.

But Charlene surprised herself — and perhaps a

28 country-guide.ca

By Lisa Guenther, CG Field Editor

few others as well — by launching a career in the grain industry. And it turns out her life experience has given her a unique view of agriculture which has served both her and the industry well.

That’s why C ountry G uide caught up with Charlene earlier this winter at the Canola Council of Canada’s conference in Banff. With its theme “Set Your Sights Higher,” it turns out the conference couldn’t have been a better match for our discussion, starting with our wanting to know how a city kid morphs into a trailblazer in agriculture.

April 2015

Photography: Derek Stobbe

business

The first step

City to combine to boardroom

Charlene’s journey to the farm started with a fateful invitation from a college friend who hailed from rural Saskatchewan. The friend suggested Charlene visit her hometown one weekend. Through that friend, Charlene met her future husband, Scott Bradley.

While farmers might wonder how city people perceive them, Charlene says that in her experience, urbanites don’t spend much time thinking about or discussing farmers. “Maybe city people should take more of an interest, but it’s just not something that’s part of their day-to-day,” she says.

Charlene didn’t hold many preconceptions of what farmers were like, either. Things that might seem mundane to long-time rural residents were interesting to her. For example, it was striking, when she first settled in rural Saskatchewan, that there was this collective weather obsession. Producers were interested in not only their own rain gauges, but their neighbours’ as well. Knowing what she knows now, it makes perfect sense, she says, adding it was one of her first “ah-ha moments.”

Leaving the city did require some adjustments.

One of the biggest was letting go of the convenience of city life. Having to drive an hour round-trip was a contrast to urban living, where everything she wanted was at her fingertips, she explains.

Today, Charlene says her life is full and she’s very happy. “So that tells me my decision was a good one.”

The Bradleys grow everything from canola to lentils. Charlene describes the farm as a partnership, where she and Scott discuss decisions together.

They also have their own roles. Charlene focuses on the books and paperwork, and she’ll hop into the combine after work. Scott, who is the career farmer, does most of the marketing and handles agronomics, including crop planning and inputs.

Scott and Charlene have three children, and their oldest, a son, is set to graduate high school this year.

While he’s expressed interest in farming, Charlene doesn’t want her kids to feel obligated to farm. So she and Scott are encouraging them to go out and experience the world before they decide to come back.

“And this way when they do come back, everyone will know it’s because they truly love it.”

Working with Scott on the farm has given her a deep appreciation for agriculture.

“Feeding the world, as my husband says, it’s a great opportunity in life to be able to do that. And so I’ve had an even better opportunity, I think, than a lot of producers because I’ve had the farm education,” she says.

The conference agenda is packed here in Banff, but on the last day we have managed to carve out some time during a break. The other delegates have congregated in the foyer outside the conference room and their voices bounce off the Fairmont’s stone walls. We find a relatively quiet spot in a nearby ballroom, where hotel staff are finishing lunch setup.

The walls and ceiling are blue and gilded gold, in that style you often see in old railway hotels. In a modern hotel, it would be gaudy, but in the Fairmont Banff Springs, it evokes a historical luxury.

Charlene is comfortable in this opulent setting, and I get the sense that she finds a way to be comfortable wherever she is. If she has found a way to balance rural and urban, it isn’t the only kind of balance she has achieved, and it makes me wonder if she is a template for successful women in agriculture.

She’s easy to talk to. But she thinks about what she’s saying.

She’s not loud or brash. But she doesn’t come across as meek either. She radiates quiet confidence.

At the same time, she has a straightforward, down-to-earth manner that I’m sure serves her well in rural Saskatchewan.

The point, I think, is that it’s not only her knowledge that matters, although that’s obviously important too. It’s those personal attributes of attitude, poise, and self-assurance.

But even with those strengths, I can’t help wondering: how does a young woman from Edmonton adapt to life on a farm near Stranraer, in west-central Saskatchewan?

Ultimately, not having any preconceived ideas about the grain industry might have been a good thing, Charlene says. “I was told when it’s bad, it’s devastating, but when it’s good, it’s like you won the lottery.”

“We got through our tough years early on and things are going well now.”

They are simple words, and maybe not quite what you would expect from a woman who is a certified management accountant and who has had so much management experience. Shouldn’t she be telling me about business objectives and equity ratios?

But when I listen closely, there’s a different kind of precision.

I ask, didn’t she ever wonder whether moving out to the farm was the right decision?

Her answer begins with her saying that everybody wonders at times about the decisions they’ve made.

She’s had her moments too, she admits. But as her husband told her, “It’s only geography. And he’s 100 per cent right.”

Continued on page 30

April 2015

country-guide.ca 29

business Continued from page 29

Know the numbers Charlene has also spent 13 years working in the grain industry. An accountant by trade, she started out as chief financial officer with the nearby Prairie West Terminal, which at that time was an independent, farmer-owned grain handling facility.

The Bradley children were starting school at that time, and Prairie West was close and convenient, Charlene says. She soon found that working at an independent terminal offered unique benefits.

“Because we were an independently owned terminal, you learned the grain industry from start to finish as opposed to being in a mainline company, where you’re only seeing a small piece of a larger pie,” she says. Prairie West gave her the opportunity to work on many different, exciting projects, she adds.

In 2005, Prairie West was part of a consortium that bought a Vancouver terminal the Competition Bureau had forced Agricore United to divest. Charlene says learning about the port side of the industry was fascinating. How business dealings were run was interesting, she adds, and she compares working with the unions to the clash between urban and rural.

“It’s so much more than what we deal with just bringing your grain to the elevator and selling it at the farm gate,” she says.

After nine years with Prairie West, during which time she served as CFO and interim CEO, Charlene left to do contract accounting

for various agricultural companies. She then took a job as general manager at a Parrish and Heimbecker terminal near Biggar, Sask.

Today, her career has come full circle, as she’s back managing Prairie West, which was purchased by CWB in 2014.

“It’s been a wonderful experience because I’ve been sought out to do that,” she says of the move back to Prairie West. “I’ve been very blessed in my career.”

Moving from accounting to managing elevators hasn’t been without its challenges, though. Some areas in agriculture are approaching gender parity, or even have more women than men. But there aren’t many female elevator managers out there, Charlene says, and some people aren’t used to seeing a woman fill that role.

“You can see that there’s some uncomfortableness or awkwardness with others. So that did take some getting used to. But it’s not something that bothers me as much as I think it bothers other people,” she says. And, she adds, it’s exciting to lay the groundwork for future generations.

After serving on SaskCanola’s policy committee for two years, Charlene threw her hat in the ring for a seat on the board. She became a director in December 2014.

“I would like to think I bring a different perspective,” says Charlene of her role as a director.

And that she does. She gets to live and breathe the farm life, from seeding to harvest, she says. And she’s seen the industry “from farmgate to tidewaters.”

“I’ve had an enormous opportunity that a lot of people in the industry, as well as on the farm, don’t get exposed to,” she says.

There can even be an advantage coming from the city, Bradley says, since you arrive with fresh perspectives The future looks bright I talk to Charlene again after the conference, and she says that she’s optimistic about the future of agriculture. There’s more research and innovation happening now than ever before, she says, and many young people are gravitating towards agriculture.

When Charlene relocated to the farm, agriculture was in a downturn. But she and Scott toughed it out, and she’s glad to see younger farmers in her area thriving.

Young farmers in her area have taken advantage of local oilfield activity, she says, often doing both for a while. “What they do seem to do is they build up some wealth with the oilfield and then they gravitate to just farming.”

But she also knows that the game has evolved since she first joined the farm. In general, farmers have always known how to do business, but today they are even more business savvy, which should help given the current price slump.

Today’s farmers are also better planners than they were even five or 10 years ago, and with dual marketing in the West, they are even more on top of pricing and contracting, she says.

Coming from an urban setting, Charlene faced a steep learning curve, but it’s been a worthwhile education, and she never felt that her city upbringing would prevent her from being able to master it if she applied herself.

“Keep an open mind about life,” she now tells young women.

“You never know where it will take you.” CG 30 country-guide.ca

April 2015

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management

Our other business Farmers are land investors too, but are we any good at it?

By Gerald Pilger ost farmers operate two businesses. Naturally, the first business involves them in the production and marketing of some commodity or other product, but it’s the other business that is looming larger and larger.

It’s their real estate investment business.

Of course, farmers integrate their real estate into their production business, with land and buildings used for the growing of crops or as a location for the production of livestock.

Importantly, too, the asset value of the real estate is used as collateral in securing loans and operating funds for their production activities.

As well, the real estate investment business often serves as the retirement or pension fund for many farm operators and their families.

But while most farmers are good operators and managers of their farm operations, can the same be said about their management of their real estate investment business?

There is no question that farmland has been an incredibly good investment in recent years. FCC reported the average increase in Canadian farmland value in 2013 was a whopping 22 per cent. If you purchased farmland in Ontario for the average price of $3,000 per acre in 1994, that land would have been worth about $11,000 per acre by 2012, essentially quadrupling your initial investment.

With these kinds of returns to ownership of farmland, how can there be any question about the value

Figure 1. Farmland price to cash rent multiple for west-central Indiana, 1960 to 2014 35.0

Actual P/rent Average P/rent

30.0 25.0 20.0 15.0 10.0 5.0 0.0 1960 1964 1968 1972 1976 1980 1984 1988 1992 1996 2000 2004 2008 2012 August 2014 – Department of Agriculture economics

32 country-guide.ca

of investing in it? But with any investment, past performance is no guarantee of future returns. Instead we need to look to the fundamentals and at what gives land its value.

Is land still a good investment?

Dr. Michael Langemeier at Purdue University urges caution: “We are already seeing weakness in the farmland market in the U.S.” If cash rents go down, there will be an impact on land values, Langemeier says. Crop prices are declining and most economists believe they will stay low for the next few years. Some producers are already seeing negative returns from their crop production, so this will impact cash rents.

In fact, Langemeier believes land values will go down faster and harder than cash rent.

As well, interest rates also have an impact on farmland. “Land values will drop if interest rates go up,” Langemeier says. “Interest rates have been low for so long, people are used to low rates. But as the economy improves, interest rates will go up.”

Langemeier suggests farmers use a Price/cash rent ratio (P/rent) to determine if land they are considering purchasing is a good investment. The paper, “Farmland: Is It Currently Priced As An Attractive Investment?” which Langemeier co-wrote with Dr. Timothy Baker and Dr. Michael Boehlje, tracks farmland P/rent from 1960 to 2014. The chart of P/rent ratio is scary! See Figure 1.

Over those 50-plus years, the average P/rent ratio for farmland was 18.2. This is relatively close to the average S&P 500 price/earnings ratio of 18.7 for the same time period. However, since 2004 the P/rent has been well above the average. Land prices peaked in August 2014 at 33 times rent.

The authors also compared a running 10-year average of the S&P 500 P/E and the P/rent and found that this ration (i.e. P/rent10) now exceeds the peak S&P P/E10 recorded during the dot-com stock bubble in the late 1990s.

Their study concludes: “Land buyers beware…

Our reading from examining 55 years of history is that current farmland values are now extremely elevated in relationship to underlying economic fundamentals. If we are correct, this means that those purchasing farmland at current prices have a high probability of experiencing buyer’s remorse in coming years.”

April 2015

management

Should you buy now?

What does all this mean for farmers seeking to purchase land?

For many farmers, owning land is more an emotional decision than an economic one. As long as they can make the payments, they are willing to purchase land. They justify their purchase, saying, “if I don’t buy it now, I will never get another chance.”

That may be true, but it pushes a whole series of questions to the forefront.

Does it justify paying more than the land is truly worth? Is ownership of that particular piece of property worth the risk that you will not be able to make payments if interest rates go up or commodity prices go down? Are you willing to tie up equity you already have in other owned land in order to secure an overvalued mortgage, especially since you will then not have that equity available for other needs? Are you willing to forgo the returns you are receiving on current investments which will have to be liquidated to meet the down payment for a land purchase? Can you live with a reduced cash flow until the mortgage on land you are purchasing is paid off?

Then there are also the “economic” arguments.

We often hear that land has always gone up and it has outperformed the stock market. Lenders and those selling real estate or investments in farmland like to remind us of this, and over the long term it may be true. But like all investments, land appreciation is not smooth, constant, or guaranteed.

We have seen land drop in value, as happened in the early ’80s, after which prices took a decade or more to recover.

Unlike investments such as stocks, you cannot easily liquidate overpriced land if land values begin to fall. It is much harder to sell to cut your losses on land than many other assets. You are making a long-term ownership commitment when purchasing, so you had better be sure you are not buying at the peak of the land price market.

With a P/rent of 40 or more, as it is right now in central Alberta, is this a wise time to purchase?

Would you buy a stock with a P/E ratio of 40?

Maybe you would if you felt it had good growth opportunities and had safe earnings, but can you say that about land today, given falling commodity prices, the risk of rising interest rates, and recordhigh land values?

Interestingly, there are a few publicly traded land ownership funds in the United States. A March 2015 look at a financial analyst’s outlook for these companies may give a hint of their outlook for land values.

• Gladstone Land Corp. (NASDAQ LAND) owns about 8,300 acres of vegetable and berry farmland in Arizona, California, Florida, Oregon, April 2015

and Michigan and it rents the land to farmers. At press time, Market Grader rated this company at 18 on a scale of 0 (sell) — 100 (buy).

• F armland Partners Inc. (NYSE FPI) is a real estate company that owns about 46,000 acres of row-crop farmland in Illinois, Nebraska, Colorado, Arkansas, Louisiana, Mississippi, and South Carolina. Market Grader also rated this company at 9.

• L imoneira Co. (NASDAQ LMNR) both owns and operates lemon and avocado orchards in California. Market Grader rates this company at 45.

Finally, in an April 2014 article entitled “Is Farmland The Next Canadian Bubble,” the stock market adviser The Motley Fool Canada advised its followers: “… avoid buying physical land. Prices have just gone up too far, too fast.”

Not making it anymore Next there is the argument that “they aren’t making land anymore,” so it will always be worth more. But is that true?

In the March 6, 2015 University of Illinois FarmDoc Daily, authors John Newton and Todd Kuethe report U.S. farmers harvested 20 million more acres of corn and soybeans in 2014 than they did in 2005. A good portion of that land came out of the Conservation Reserve Program. We are also seeing large increases in seeded acreage in South America and Eastern Europe. Furthermore, there is a large untapped potential for additional acres and for increased production as a result of more intensive farming practices in much of Africa.

But what about the two billion more people who will need to be fed by 2050? Interestingly, CNBC reported FAO estimates that while there is 0.218 ha of farmland per person today, that ratio will only decrease to 0.181 ha/person by 2050. If this is true I wonder if increased efficiency and production could easily compensate for this reduction in land per person.

Also don’t forget that roughly one-third or more of all food produced is wasted today. We could feed a lot more people with the same level of production and same land area simply by reducing losses and waste.

Finally, potential buyers will argue that if they own the land, they do not have to pay rent. But rent is actually the return on your investment in land. You should still be paying rent to yourself on owned land, at least on paper. You are fooling yourself if you are allocating all your returns on owned land to the farm operation and paying yourself nothing for your investment in land.

You may consider yourself a great manager if your records show a large profit per acre after expenses, labour, and taxes, but if you paid $4,000 an acre for that land and you are charging your farm operation nothing for the use of that land, how good an investment manager are you? CG country-guide.ca 33

A M E - ma n a g eme n t

The strategic approach to managing employees

By Julia Christensen Hughes f you own or manage an agricultural business of any size, you likely have a number of employees (family members or otherwise) working with you. And you have them for good reason. Employees come with many benefits, or at least they should.

Employees with specialized skills can provide missing competencies and networks, allowing the business to grow in new directions. Front-line supervisors and hourly employees provide the benefit of additional oversight and production capacity. They also provide significant operational efficiencies by allowing more highly paid talent to focus on running the business, analyzing results and making strategic decisions, rather than being perpetually caught up in the business of everyday “doing.”

Finally, as a business owner or senior manager with capable employees, the possibility exists for you to have a more balanced life: to take vacations, take care of your health, take care of your family and ultimately, ensure that your business continues to thrive.

Despite all these potential benefits, it may be surprising that one of the most disliked aspects of business is managing employees, according to research

by Berrett-Koehler in 2011. This may be especially true for first-time and front-line managers.

One study by the consulting group Development Dimensions International (DDI), found that the top reason why newly promoted front-line managers took the job was for more money (50 per cent), not because they aspired to lead others. The majority (57 per cent) learned their leadership skills by trial and error.

Of these, over one-third regretted being promoted, largely due to the stress of being ill prepared to manage others (www.ddiworld.com/DDIWorld/media/ trend-research/findingthefirstrung_mis_ddi.pdf).

Farm owners and senior managers participating in Agri-Food Management Excellence (AME) programs have similarly shared their reluctance for dealing with poor performers or for taking on additional tasks essential for managing others, such as: regularly and enthusiastically communicating the organization’s vision, values, goals and results; facilitating participative problem-solving and decision-making meetings; developing effective and engaged teams; and providing ongoing performance feedback.

In the HR section of the AME programs, I focus on 34 country-guide.ca

helping the participating managers and business owners reflect on their current strategies for managing others and identify specific opportunities to better align their approach with the strategic intents of the business. The framework used was first developed at the Harvard Business School by Michael Beer and Bert Spector in the early 1980s, in response to declining international competitiveness within the U.S. manufacturing sector.

The first area of the framework is known as “employee influence,” which is the extent to which employees are well informed about the business and have the opportunity to influence their own areas of responsibility. Seeking employee opinion when purchasing a new piece of equipment, for example, can contribute to a better decision and garner support for implementation.

As well, fostering a culture of employee engagement in which people feel respected and motivated to regularly go above and beyond generates proven positive bottom-line results.

The second area is “reward systems,” which include the wages, bonuses, and benefits employees receive in exchange for their labour, as well as the sense of pride and accomplishment that comes from a job well done. Taken together these rewards form the employee value proposition (i.e. what the organization provides in exchange for the heads, hands and hearts of its employees).

Organizations with a clear and competitive value proposition are better able to attract and retain employees with the skills and attitudes required.

The third area of the framework is “human resource flow” i.e. the practices that influence the flow of employees into, through, and out of the organization, such as recruitment and selection, training and development, and performance feedback.

Many employees today are looking for jobs where there is a commitment to ongoing training and development. They also want their work to be socially beneficial. Emphasizing these opportunities on the company’s website and in any job advertisements can help build a positive employer brand and attract greater numbers of applicants.

When assessing applicants, managers are well advised to augment their interviews (which are inherently unreliable predictors of performance) with tests that replicate typical job demands. Asking potential employees to use or fix a piece of equipment, to make a presentation, or to serve a customer, for example, can help to avoid costly selection errors.

Once hired, instead of the dreaded annual perforapril 2015

A M E - ma n a g eme n t mance review, research has found that it is far more motivating to provide ongoing performance feedback, ideally by putting in place a system that enables employees to monitor their own progress against agreed-upon goals, thus providing them with the opportunity to adjust their own performance as needed.

When employees consistently fail to meet expectations, managers must remedy the situation by providing additional training or support, adjusting the individual’s work responsibilities, or terminating the relationship.

Finally, we talk about “work systems” and the management of effective teams. People are inherently competitive and selfinterested. In order for a team to thrive, it is essential that its leader ensure certain attributes are in place, such as common goals, clear roles and accountabilities, effective communication systems, and a culture of trust.

Taken together, these four elements comprise an organization’s strategic approach to managing people. While much of this may seem like common sense, in practice, many of these suggestions are not common at all.

That is why, when done right, and once cemented in an organization’s culture, a competitive advantage can be achieved. CG Julia Christensen Hughes, PhD, is dean of the College of Business and Economics, University of Guelph and an instructor with AME. For more information on the University of Guelph’s MBA program in food and agribusiness management see: www.uoguelph.ca/business/mba. For information on AME visit www.agrifoodtraining.com.

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10901A-CFM-5Reasons-QRTPage-CountryGuide.indd 1

4/2/14 11:59 AM

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business

Your value-added marketing plan Once you’ve got your value-added product or service ready to go, the hard part’s done, right?

By Helen Lammers Helps

ot so fast. Chances are you are going to need to work hard to build product awareness. The experts agree you need a plan for how you’re going to let your potential customers know why they’re going to want to do business with you.

The marketing plan is a vital part of your business plan and should emphasize the five Ps of marketing.

Product, positioning, place, price and promotion must be thoroughly dissected. But there also has to be more.

Five common mistakes Gary Morton, a consultant in Coldbrook, Nova Scotia, has been helping farmers launch value-added businesses for more than 20 years. Among the most common mistakes he sees value-adders make are: 1. Not defining their target market. Too many people think anyone who eats food is a customer, but that’s too general. Morton says you need to ask: “Who is likely to buy my product and how can I get to them?”

Often the market is not who you think it is.

2. Not budgeting enough for marketing. Morton says you may need to spend as much or more than what you spent on product development.

3. Ineffective package design. Here’s another area where farmers commonly don’t spend enough. The package must stand out and be recognizable.

4. Not giving out enough free samples. “When it comes to food products, it’s essential to give out samples,” Morton says. If your product is in a grocery store, give samples to staff so they can speak knowledgeably about your products to the consumer, he says. Value-added businesses have to have an ongoing commitment to marketing and building product recognition.

5. Doing only half the job. Too often, farmers think that once they’ve got the product onto grocery store shelves their job is done.

Morton emphasizes that although the store is providing space for your product, you still have to create the market demand.

Key elements include product differentiation, your “story,” and your customer profile.

Also never forget that your marketing plan is a way to focus both formal and informal market research to help you tailor your product or service to your target customers for maximum effect.

But how do you create your marketing plan?

Start with your customer. The value-added marketing gurus tell us consumers choose to buy directly from farmers for many reasons. Some people want to buy local, while others want to know where their food comes from. Still others may want to have a relationship with the farmer or they may simply enjoy the atmosphere of the farm or want to have a more intimate shopping experience.

Of course for many, the answer is some version of “all of the above.”

How do you market your product or service into that continuum? Which factor is most important for you?

It can help to start by listening to the real experts, i.e. other farmers who are succeeding at value adding.

“People buy food for many reasons, not just to nourish themselves,” says Cindy Wilhelm, owner of Dragonfly Garden Farm near Chatsworth, Ont. which sells 130 products online through its on-farm store and through various retail outlets. “Know your food and farm philosophy,” says Wilhelm. “And don’t stray from it.”

“Make sure you have a unique quality product,” adds Jim Eby, owner of Eby Manor Golden Guernsey Milk near Waterloo, Ont. “Our Guernsey milk has a unique flavour and higher A2 protein content, so we felt direct marketing was the way to go.”

It all starts with the product, agrees Debbie Nightingale, owner of Haute Goat in Campbellford, Ont. which sells handmade skin-care products and chocolates made from their goats’ milk through both an online and on-farm stores.

“It’s about the passion you have for it, what makes it different and what your ‘story’ is,” Nightingale continues. “When we talk about our goats and our love for them, it’s contagious. People want to tell you their goat stories, hear more about ours, and just be part of the excitement.”

Continued on page 38

36 country-guide.ca

April 2015

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business Continued from page 36 Jo-Ann McArthur, president and founder of Nourish food marketing, a Toronto company that specializes in all aspects of food and beverage marketing, agrees that telling “your story” should be a key part of your marketing strategy. “We are hard wired to respond to character-driven stories,” McArthur says.

Peter Katona, sales and marketing manager at Martin’s Fruit Farm near Waterloo, Ont. also advises trying to see your product and retail space through the eyes of your customer.

That means getting to know your customer. To help you understand where urban customers in particular are coming from, Katona suggests reading popular food literature such as Michael Pollan’s, The Omnivore’s Dilemma or watching films like “Food Inc.”

“ Remember, this isn’t farming, it’s retail,” says marketer Peter Katona. “You need to be a people person.”

Also anticipate what your customers want to find.

“Your product and property need to be visually appealing. Visitors may want to see the animals,” says Katona.

“Clean up your barnyard, get rid of old, rusty farm equipment… look at it through the city person’s eyes.”

People are coming to your farm for the experience, Katona continues. “Give your potential customers a country welcome. Remember, this isn’t farming, it’s retail. You need to be a people person, build relationships and be able to deal with complaints.”

Presentation is everything and includes your retail space and staff. Is your sales area organized so people can find what they are looking for? Is your staff well trained? Do they know the product, how it’s made and how to use it? Do they have uniforms?

You will also have to decide on the mix of advertising, personal selling, sales promotion, public relations, and social media that you will use to promote your product or service.

Nightingale says they use various ways of marketing including their website, Facebook, Twitter, newsletters, online videos, a teeny bit of print, publicity (they were just featured in the LCBO’s Food & Drink magazine and got an incredible response), consumer shows, trade shows, farmers’ markets, through their on-farm store, and getting products to celebrities or opinion-makers so they can spread the word.

Jessica Kelly, direct farm-marketing program lead at the Ontario agriculture ministry says that one of the mistakes she sees people make frequently is to have too narrow of a definition of marketing. “They tend to think of marketing as advertising and promotion,” Kelly says.

Instead, value-adders should look at the broader opportunity, Kelly says, and the message should be comprehensive and consistent. For example, if it’s a premium product, the packaging and the way you promote the product should fit.

Nightingale sought out the help of an experienced designer, Dana Harrison, to develop her logo. “We had a concept of what we wanted and she designed it,” says Nightingale. “She’s great for foodie startups and gets excited right along with you!”

Nightingale also hired Succinct Social Media to help with promotion. She says the company has been great for getting their name out there, but she wonders if she should have spent more time and money on getting their website and Facebook page “right,” such as optimizing SEO. “It’s a delicate balance of all of these things,” Nightingale says. “You have to be patient and put in the time and money.”

In our next issue, Helen Lammers-Helps will conclude this series on building a value-added business with her focus on digital marketing and social media. CG

Best practices for direct farm marketing Dr. Andreas Boecker and his colleagues at the University of Guelph studied several value-added businesses and summarized their findings in the Direct Farm Marketing Business Resources available at www.omafra.gov.on.ca.

Below are recommendations based on their study of how successful valueadded businesses go to market: • Create a unique brand.

• Know the legal requirements.

• Network and collaborate with other local businesses.

For example, sell non-competing products from other farms or collaborate on events.

• Get involved in regional publications such

38 country-guide.ca

as local food maps and local tourism offices that promote culinary or agri-tourism.

• Connect with local media such as newspaper and radio.

• Stay connected with your customers. Build a customer database, send out an email newsletter, connect using social media, and use surveys.

• Offer value-added services. Hold special events, give out recipes, and suggest other local attractions to customers.

• Take part in off-site activities that fit your brand.

Choose events that attract like-minded people.

• Prioritize your marketing channels, and know which ones are income earners.

April 2015

hr

Don’t work harder, work smarter We all want to be more productive, so here’s the good news.

You can be. Higher productivity is within your reach

By Pierrette Desrosiers, psychologist and coach

would do it if I only had more time.” We all want to be more productive and to perform at our peak every day. We all want to manage our time better, but guess what? If there is one thing that everyone has equally, it is time. We all have 24 hours each day.

What makes the difference is how you invest your energy during those 24 hours, and what you choose (consciously or not) to do, say or think about.

The first key is becoming more aware of your thoughts, actions and habits so you can choose the ones that help you achieve your goals. The second is to know how your brain works. The more you know about your brain, the more freedom you have. You can choose the best approach to improve your time management and get the best return on your time investment.

In the last six years, 98 per cent of everything scientists know about the human brain has been discovered. Moreover, 80 per cent of what scientists thought was true about the human brain before 1995 has now been found to be false or misleading.

We have a lot to relearn as we develop effective management approaches.

Here are seven tips to perform at your peak every day.

1. Don’t check your email first thing.

“Your ability to make great decisions is a limited resource,” writes David Rock in Your Brain at Work. Decisionmaking is a task that spends your limited resources. The more decisions you make in your day, the more you spend that energy. When your bucket is empty, you suffer from “decision fatigue,” compromising your ability to make good decisions. You become paralyzed or impulsive and less able to manage temptations.

The way you start your day is important.

Unless your task is to read and respond to an email, try to keep that for when you have less energy. When you read your emails first, all your good ideas, insights, priorities and objectives are set aside to take care of the objectives and priorities of others.

April 2015

2. Prioritize your top three goals.

If you don’t prioritize, you will just go with the flow. Choose your priorities first thing in the morning or the night before. Because we remember three ideas at a time, the rule of three is the best.

Set three goals for the year, the quarter, the month, the week and the day.

With more than that, your brain will not know what is really important; it will scan too many things and be bothered by too much information from outside.

3. Conserve your decision-making energy at every opportunity.

Because your ability to make great decisions is a limited resource, you should make discerning choices at every moment. So don’t pay attention to trivial, non-urgent or unimportant tasks.

Don’t check your email constantly “just in case”; concentrate on what you’re doing. Don’t overthink your projects.

4. Find and protect your quality thinking time.

Research shows that our ability to think deeply, reflect, have quality time, focus deeply on a task and be truly efficient decreases constantly. Many leaders admit that they have just a couple of hours of quality thinking time per week.

We need that precious time to solve complex problems or to be creative.

The best time for complex thought is when your bucket is full, in the morning. So protect yourself from all distractions: close the door and turn off all the alarms and alerts (emails, texts, phone calls). You will be surprised at how much you can achieve in a short period of time.

5. Don’t multi-task.

Can you really afford to multi-task?

Research proves it: Your brain can only do one conscious thing at a time. When you switch between tasks, everything is affected: your performance, speed and energy level all decrease significantly. You also increase the risk of accident. So don’t text while you drive your tractor.

6. Maintain a positive state of mind.

Your brain scans everything and classifies objects as threats or rewards. As humans, we stay away from threats and move toward rewards. We are more productive, creative and collaborative when we are in the “toward reward” mode. But how do you maintain a positive state of mind when you feel threatened?

• Identify how you feel.

• Put words on your emotions to reduce negativity.

• Reinterpret events. Don’t say, I will never be able to accept that, farming is so hard, or there is no future. Rather, look for opportunities to develop your tolerance or adaptation.

• Have a nap.

Your brain and your body both need rest. So have a nap after lunch or in the middle of the day. I know… “What if someone finds out?”

A short nap (20-30 minutes) is usually recommended. This type of nap provides significant benefits for improved alertness, creativity and performance for the rest of the day without interfering with nighttime sleep. Naps also reduce mistakes and accidents. A study at NASA on sleepy military pilots and astronauts found that a 40-minute nap improved performance by 34 per cent and alertness by 100 per cent.

So, to function at your peak, remember: “ Your beliefs become your thoughts, Your thoughts become your words, Your words become your actions, Your actions become your habits, Your habits become your values, Your values become your destiny.”

— Mahatma Gandhi Pierrette Desrosiers, MPS, CRHA is a work psychologist, professional speaker, coach and author who specializes in the agricultural industry. She comes from a family of farmers and she and her husband have farmed for more than 25 years (www.pierrettedesrosiers.com). Contact her at pierrette@pierrettedesrosiers.com.

country-guide.ca 39

business

JCB builds market share JCB used to be a construction brand. Now it is a farm brand too, with advanced materials-handling capability

By Scott Garvey, CG Machinery Editor n early March I spent a day in a Georgia field with a line of JCB equipment designed especially for the ag market, including the unique Fastrac tractor that is capable of breaking speed limits in the field.

Then that evening, I joined other ag journalists in Savannah for dinner with some of the U.K.-based brand’s executives. Naturally, the topic of JCB equipment, especially the Fastrac, came up.

Even JCB anticipated the question that I had in mind, with Richard Fox-Marrs, global managing director for JCB Agriculture, putting it into words before I could get it out. “Why would you want to build another conventional ag tractor when there are already a lot of other companies out there doing a pretty good job of it?”

Arjun Mirdha is president and CEO of JCB North America.

Photo: JCB

In fact, JCB doesn’t seem to want to be at all like other ag equipment manufacturers in any of its engineering or marketing efforts. It has found a niche in the North American equipment market, and it intends to makes its mark selling specialty products into that niche.

It’s why we were there in Georgia at the brand’s North American field day, an event that was previously limited to reporters from construction industry publications.

The brand is still much better known in the light construction sector. In the United Kingdom, the name JCB is synonymous with backhoe, in the same way Canadians often can say Ski-Doo to refer to snowmobiles. But if executives have their way, JCB will also become the generic name applied to the go-to machines that North American farmers will choose for moving heavy material on farms, like large round bales.

40 country-guide.ca

It’s a market segment that JCB executives refer to as “ag materials handling,” and it is a segment they are pursuing full throttle.

“That’s where we come in, because JCB is the global leader in agricultural materials handling,” explained Fox-Marrs in a formal address to media members earlier that day. “If you consider the overall scale of modern farming operations that have become so much more productive in recent years, you begin to really understand the vital role of materials handling.”

The line of machines the brand offers fits nicely into that description. The company is taking technology more often seen in the light construction sector and tailoring it to the needs of farmers, in some cases with specific agricultural option packages.

According to Arjun Mirdha, president and CEO of JCB North America, focusing on that agricultural niche has been good strategy for the brand. Perhaps, too, it has demonstrated that on-farm materials handling has been until now a relatively unexploited area in the equipment marketplace, at least here in Canada and the U.S. “Agricultural material handling, led by the telehandler, is pivotal to JCB’s future success here in North America,” Mirdha said during his presentation to journalists at the firm’s Savannah, Georgia, assembly plant.

“It’s a market that is changing quite a lot. Allow me to give you some context. Five years ago, in 2009, JCB sales of agricultural telescopic handlers were primarily to the three largest markets for these products, France, the United Kingdom and Germany. Now North America is emerging as another key market.

“Globally, the market for agricultural telescopic handlers grew by just two per cent last year, but here in North America, it grew by 17 per cent,” Mirdha continued. “However, relative to some other markets, North America is still quite small, as the tractor loader continues to dominate this market (in agriculture). But, in short, we’re witnessing a change in this market.”

Overall, JCB’s sales on this continent last year ran counter to the trendline that sandbagged the other major manufacturers. JCB’s sales jumped 23 per cent over its 2013 numbers. Even more remarkably, total sales have grown by over 193 per cent in the last four years, which means it has consistently outpaced the average growth rate in both the ag and in the light construction sectors where the brand does business.

“JCB Agriculture has doubled its business over the past five years, in terms of both volume and revenue,” said Fox-Marrs.

April 2015

business

Dan Schmidt, vice-president of agricultural sales for North America, introduces the Fastrac 4000 Series to journalists at a media event in Savannah, Georgia, in March.

Photo: Scott Garvey

“This outstanding performance means North America is now JCB’s third-largest market for machine sales,” said Mirdha. “And the good part is we’re just getting started, particularly in agriculture. We now have 97 dealers operating out of 300 locations, with plans to expand to over 500 outlets by 2018. Nearly one-third of our current dealers are dedicated ag distributors.”

To support those dealers and customers, JCB has doubled the size of its North American parts warehousing operations, and last year, it expanded its Canadian facility.

“One of the reasons I think we’re making inroads in agriculture in North America so quickly is JCB is designed around the owner operator,” added Dan Schmidt, vice-president of ag sales, North America.

“In Canada and the U.S., our owner-operators identify with creature comforts, safety and fuel efficiency as well as performance and productivity.”

Spearheading the brand’s stronger move into the ag market is its flagship product, the redesigned 4000 Series Fastrac tractor. Capable of 65 km/h with active four-wheel suspension and a rear deck that allows it to carry 4,400 kilograms, it’s definitely not the kind of me-too, standard ag tractor Fox-Marrs questions the wisdom of producing.

Although JCB has been selling the Fastrac in North America for some time, its popularity had been limited. But according to Schmidt, brand executives spent a lot of time asking farmers what they did and didn’t like about it ahead of the machine’s recent makeover. The result is the re-engineered 4000 Series version, intended to better fuse with farming practices on this continent.

“Here in North America and other regions with large-scale farms, such as Australia, the need for high-speed, high-performance tractors is also growApril 2015

ing,” explained Fox-Marrs. “And this is where the JCB Fastrac has really come into its own.”

The Fastrac isn’t the only machine to get new engineering in order to meet farmer demand. The two-model line of Telemaster machines — the blending of a wheel loader and a telescopic handler — were built primarily to fit into the ag sector. The goal is to bite into the market which is currently almost the exclusive domain of the loader tractor.

“The tractor loader has been the traditional method of moving materials on North American farms,” FoxMarrs added. “And that remains true today. In round numbers, in the 70- to 160-horsepower class, over 17,000 tractors fitted with front loaders are sold onto U.S. and Canadian farms every year. Sure, not all tractor loaders will be replaced by dedicated material handlers. However, the numbers indicate this is far more than just a niche opportunity.”

Executives are also hoping the different design of its skid-steer loader will find favour with farmers. Plus, JCB has ramped up production at its Georgia assembly plant to meet what Mirdha says is a substantially increased demand from both the ag and construction sectors.

“We’ve invested over US$60 million right here in Savannah to design a range of skid steers and compact track loaders for farmers,” Mirdha said. “We’ve also invested heavily in our Loadall (telehandler) production capacity by extending our telescopic handler assembly lines.”

“Over the past five years, JCB has strengthened and improved its entire product range,” added FoxMarrs. “We’ve strengthened distribution in key markets, especially here in North America, which is really starting to pay dividends.”

Said Mirdha, “As you can see, agriculture is a market we are very serious about at JCB.” CG country-guide.ca 41

CropsGuide

By Jay Whetter

Phosphorus “ph”inancials Phosphorus deficiency is hard to identify and often goes unnoticed — even when significant yield loss can be occurring. Will an extra 20 lbs./ac. of phosphate pay off? oil phosphorus levels are critically low in more and more fields. These fields may no longer provide enough phosphorus for crops to reach their yield potential, which means the solution to yield stagnation — on some fields, at least — could be plain old boring phosphate.

Canola takes up around 1.5 pounds of phosphate per bushel of yield, and about one lb./bu. is removed with the harvested seed. A 40-bushel crop, for example, removes around 40 pounds of phosphate per acre. Yet, applied phosphate rates are often well below this crop removal rate.

The Canola Council’s Warren Ward says phosphorus is often the first place growers should look if they feel they’re no longer getting full nitrogen response.

“If growers feel like they’ve hit a plateau on yield — they apply more and more nitrogen and see no yield improvement — the other macros should be the first place to check,” says CCC agronomy specialist Warren Ward. “The first products to investigate should be phosphate and sulphur — especially if they are not being applied at recommended replacement rates, if soil testing repeatedly shows low levels, or if the crop shows symptoms of a deficiency.”

Only after checking phosphate and sulphur and not detecting any issues would a grower move on to potassium and micros, Ward says.

A grower’s reluctance to spend more on phosphate makes sense based on past experience. To some extent, phosphate removal can be naturally replenished from soil reserves in less soluble mineral forms or via release from soil organic forms. That’s why past work, as stated in the Canola Encyclopedia, concluded: “Canola shows a yield response to phosphate fertilizer no more than half the time.”

But as soil phosphate sinks into the “low” range, Alberta Agriculture research shows that the return on investment for following recommended rates can be very high. In fact, it says 90 to 95 per cent of the time growers will see a 5.0 bu./ac. yield boost — or more — from applying the soil-test recommended rate on black, thin black or grey wooded soils that have baseline soil phosphorus levels below 20 parts per million (40 lbs./ac.) based on the Kelowna soil test method.

An Agriculture and Agri-Food Canada study on phosphorus fertilizer for canola from 2010 to 2012 found when soil test levels are lower than 10 ppm, applying 40 lbs./ac. of phosphate provided a yield response every time, compared to no phosphate.

Jeff Schoenau, soil scientist at the University of Saskatchewan, adds that the yield response can be significant even when visual crop inspection doesn’t reveal an obvious problem. He calls phosphate deficiency the “hidden hunger” because, visually, the symptoms are often non-specific, making phosphorus deficiency in canola very difficult to identify.

Hidden hunger can result in stunted, unthrifty plants with lower seed set. “But unless you have something to compare it to, it can be difficult to pick out,” Schoenau says, “even when significant yield loss is occurring.”

Continued on page 44 42 country-guide.ca

April 2015

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CropsGuide How to diagnose nutrient deficiency Visual assessment of nutrient deficiency symptoms is not good enough for an accurate diagnosis because symptoms can have many causes.

Purpling is one example. Purpling is often considered a telltale sign of phosphorus deficiency, but purpling can be a response to many types of stress. The plant is not producing chlorophyll in those areas, so the underlying purple pigment comes through.

Proper diagnosis of nutrient deficiency should use most of the following tools: 1. Soil test. Are any obvious shortages evident? Other soil test parameters such as texture, pH and electrical conductivity may also provide clues in the diagnosis.

Ask your lab what test it uses. Soil test P calibration work in Alberta has been with the Modified Kelowna method. Saskatchewan and Manitoba used the Olsen method for soil test P calibration. The Bray method, which some labs outside the Prairie region use, has not been calibrated for soils in Western Canada.

2. Fertilizer history. Over the past five years, what rates and source products have been applied on that field? Include crop yields and consider whether rates have been adequate to match removal.

3. Tissue test. A tissue test may show that the plant is deficient in phosphorus.

If the tissue test shows deficiency, a rescue application of phosphate will not help the immediate crop, but this will help determine future phosphate rates.

4. Herbicide history. Is there any chance of carry-over from products applied one or two years ago? Symptoms that look like fertilizer deficiency could be from herbicide carryover damage to roots, which can restrict their ability to take up phosphorus. In dry conditions or very wet conditions, herbicides can take longer than expected to break down to safe recropping levels for canola.

5. Environment. Cold, wet, hot and dry can all stress canola plants, creating symptoms that may look like nutrient deficiencies.

If neighbours have similar symptoms, the cause is probably environmental — frost, excess moisture, etc.

6. Field history. Recently broken forage land that has received little or no phosphorus fertilizer and has had large hay crops removed over the years is likely to be depleted. Canola seeded into a field that was in long-term alfalfa, for example, is one case where you may see severe crop stunting and delayed maturity as a result of phosphorus deficiency.

44 country-guide.ca

MAFRI’s John Heard, seen here in character for a presentation at the recent CanoLAB agronomy meetings, says if growers aren’t replacing phosphorus in their fields, they’re mining it.

Continued from page 42

1. W hat risk factors increase the chance of phosphate deficiency?

High yields, a rotation that includes high phosphate-removing crops, and phosphate rates that lag crop removal are the three big factors increasing the risk of phosphate deficiency.

Canola is a high-phosphate-using crop, yet safe seed-placed rates of phosphate are only about half of the removal rate. “By doing the right thing and keeping seed-placed phosphate levels in the safe range, growers are not matching phosphate rates with crop removal,” Ward says.

Even cereal crops, while they don’t remove as much phosphate per bushel, can remove as much per acre given their higher yield potential.

Also noteworthy is the effect of soil temperature on uptake. In cool early-season soils, roots develop more slowly and soil phosphorus availability is reduced.

Canola will often respond to a maintenance application of phosphorus in cool soils, even when a soil test is moderately high for phosphorus.

2. How does a grower identify truly phosphate-deficient soil?

A soil test of the top six inches is “pretty reliable,” Schoenau says.

Soil-test extractable phosphorus of 10 pounds of P per acre (or five ppm) or less

based on Olsen or modified Kelowna methods is a critically low level, Schoenau says.

“If growers are not in a soil-testing and -monitoring system, they could end up with soils that are really quite low,” he says.

Tissue analysis can be a useful secondary test. Many soil-test labs offer tissue analysis. Check with them to get sampling and submission procedures. If the tissue test shows deficiency, a rescue application of phosphate will not help the immediate crop, but this will justify higher phosphate rates in following years.

Soil quality and field fertilizer management history are two other key indicators. Fields more likely to be deficient have a long history with more phosphate being removed than replaced through crop nutrition practices. Fields with low organic matter, that are tilled excessively or that have lost soil to erosion (i.e. leaving a thin A horizon) are also more likely to have low phosphate levels.

On the other hand, fields with high organic matter will have higher phosphate reserves, and fields with pH in the neutral 6.0 to 7.5 range will have increased phosphate availability.

3. Under what circumstances will matching phosphate rates with crop removal provide a return on investment?

Doubling phosphate rates from 20 lbs./ac. to 40 lbs./ac. will increase costs per acre by $13. This is based on $720 for a tonne of 11-52-0. This investment is more likely to provide a return in the year of application in fields where phosphate levels are considered deficient.

“Past research has shown little economic benefit from increasing phosphate from starter rates up to replacement rates,” Ward says, “but that may be changing on fields that now have low baseline levels of phosphate.”

John Heard, crop nutrition specialist with Manitoba Agriculture, Food and Rural Development, says replacement rates may not provide a return on investment in the year of application, but growers could expect to capitalize on the extra phosphorus over the long term.

Heard gives a house maintenance analogy. “I have a rental home and in April 2015

fertilizer management the short term, I’m better off economically by ignoring the old shingles and drafty windows. But I know that if I don’t perform regular maintenance and take care of these big-ticket items a little each year, I’m going to be stuck with a deteriorated house with very little value and a huge payment to bring it back,” he says.

Soil phosphate maintenance is like house maintenance.

“By maintaining soil phosphate in a medium-high range of 15-20 ppm soil-test phosphorus (30-40 lbs./ac.) growers will have more flexibility to perhaps cut phosphate rates in years when pencilling out a profit is more challenging,” Heard says. “But if soil phosphorus is 10 ppm or less (<20 lbs./ac.), growers will not have the flexibility to apply only starter rates because yield potential and profits are often sacrificed.”

Like the house analogy, one’s approach to soil phosphate often changes based on how long you expect to keep the land and whether you own or rent. (See Table 1.)

4. How do growers rescue phosphate-deficient soil?

Building up phosphate levels is easier than building nitrogen levels because phosphate is not subject to leaching or volatilization losses, Schoenau says.

With this benefit, canola growers who don’t want to increase seed-placed rates could increase phosphate rates applied to cereals and count on this to be an overall benefit to all crops in rotation. However, even though safe seed-placed rates are higher for cereals, this would still not be enough to match removal for all crops. To match removal, some phosphate will have to go into the separate band with nitrogen and the other nutrients.

Table 1 Circumstances influence your phosphate fertilizer approach Short-term sufficiency approach Long-term sustainability approach • Short-term land tenure, such as annual land rental • Wish to spend as little as possible factor • Low crop and high fertilizer prices

• Long-term land tenure • Not wanting fertility to be yield limiting • High-value, high-yielding crops • Low-cost source of nutrients, such as manure

• Limitations to yield other than fertility • Requires band placement to ensure greatest effectiveness of nutrients’ low rates

• Rotational crops needing high level of nutrients • Limited risk of off-site losses of nutrient?

“It’s a pretty simple fix,” Ward says. “A soil test can identify any potential shortages, and extra phosphate fertilizer to match crop removal should prevent soil quality and yield from getting worse. ” CG Jay Whetter is communications manager with the Canola Council of Canada. Listen to this podcast to hear more about phosphate fertilizer decisions: http://albertacanola.com/podcast/phosphorous-hunger-games-in-soil-fertility/. John Heard has also put together an excellent new phosphate management document, posted at the bottom of the article “Are we mining soil phosphorus?” at www.canolawatch.org.

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country-guide.ca 45

CropsGuide

By Richard Kamchen

Boost your beneficials A new field guide will be available both electronically and in print in time for you to use through the upcoming crop year armers are only hurting themselves if they aren’t giving a helping hand to the natural allies in the fields that can assist them in controlling pests.

Nature not only provides, as the old proverb says. Research proves that it also pays.

In fact, new research even tells us how much it pays. Natural pest suppression is one of the most important services provided by ecosystems, says a new Agriculture and Agri-Food Canada (AAFC) report that cites the work of numerous experts. It pegs the annual value of these beneficial insects at over $400 billion in the U.S. in 1997, and about $5 billion in Canada in 2010.

Not all insects are a scourge to farmers. There are pollinators, of course, and there are also beneficial insects that limit pest populations.

These beneficial insects are of two basic kinds.

There are predators, and there are also parasites that come from several insect orders, including beetles, flies, wasps, true bugs and others, according to Lethbridge College’s Jeremy Hummel.

In Saskatchewan alone, a parasitoid that targets wheat midge saved over $248 million in reduced insecticide costs during the 1990s, according to a Saskatoon Research Centre paper.

“The range of beneficial insects is huge,” says the paper’s lead author, Owen Olfert, an invasive insect pests and biodiversity research scientist with the federal Agriculture Department.

The usefulness of these insects in pest control is so significant that they’ll even get imported when necessary. Such is often the case with invasive alien species of pests.

“A lot of our insect invasive alien species came from Europe… and they have a lot fewer natural enemies (here),” says Olfert. If we’re “fortunate,” says Olfert, the beneficials will hitch a ride and arrive at the same time as the invading pest. In those cases, the job of research is to figure out how best to grow the populations of beneficials, so they can do the best job possible.

“If there are none that show up and the pest has become a major issue,” Olfert says, “we then have an option to work with our European colleagues to try and find a parasitoid that is very specific to this pest species.” If they find such a species, then the researchers need to file an application to see if they can get permission to introduce it for control.

46 country-guide.ca

In the landscape For the beneficials already here, modern agriculture hasn’t made things easy.

Simplified cropping systems and the development of intensive agriculture have been accompanied by the steady loss of natural habitats, says the AAFC report entitled Agricultural Practices that Promote Crop Pest Suppression by Natural Predators.

Then, a vicious circle takes over, the weakened natural defences of the ag ecosystem leads to the greater use of chemicals to combat rising pest, weed and disease infestations.

“In soybeans, American studies have shown that simplification of the agricultural landscape has resulted in a 24 per cent reduction in the control of the soybean aphid by its natural enemies,” the report notes.

More complex landscapes that contain a greater amount of semi-natural habitat (such as forests, hedgerows, field margins, fallows and meadows) are associated with more abundant and diverse natural enemies, the report adds. They generally contain more beneficial than harmful organisms and provide beneficial insects with not only alternative prey and plant resources, but overwintering shelter as well.

According to the AAFC report, 90 per cent of beneficial insect species need a non-crop environment at least once in their life cycle. By contrast, only half of the pest species require such non-crop hosts or habitat.

There are management practices that can optimize natural enemy activity. Establishing or preserving buffer zones such as field margin strips, hedgerows, beetle banks, conservation strips and windbreaks can help enhance the amount of pest suppression provided by beneficials, the report says.

“There’s this whole group of parasitoids which for the most part are wasps and flies that will lay their eggs in or on another insect, and then the juveniles of those parasitoids will work on consuming and destroying that other insect,” says Hummel, who teaches plant and soil sciences. “The adults of most of those parasitoids are fluid feeders, and for the most part are feeding on nectar and naturally occurring fluid sources. So having that diversified landscape where you’ve got some flowering plants and ditches can promote those beneficials that require that alternate food source for a different point in time of their life cycle.”

April 2015

insect management Hummel also notes many farmers who put in shelterbelts do so for wind erosion control, but then also get the added benefit of being habitat for beneficial insects.

“Depending on what kind of shelterbelt you’re putting in, it might just be an overwintering habitat for beneficials.

If it’s some sort of flowering species, it might also be a nectar source for these beneficials,” Hummel says.

In southern Alberta, farmers tend not to put shelterbelts through fields because they’ll interrupt centre pivot irrigation, but some growers are situating shelterbelts along the edges of their fields.

“It still has some effect in terms of wind erosion control and then secondarily beneficial organism habitat,” Hummel says.

impacting the beneficials,” says Hummel, adding application should only occur when the pest insect has reached an economic threshold level, meaning there is the imminent risk of economic harm to the crop.

“That’s because if we’re using an insecticide before that point, then first of all, we aren’t offsetting the cost of the insecticide, so economically speaking it doesn’t make sense for the crop producer.

But then it has an impact on beneficial insects,” Olfert says. He also stresses farmers also need to determine the chemical that will not only do the job but also have the least environmental impact.

Timing in the case of wheat midge can be tricky. There’s a very narrow window just prior to flowering when the wheat plant is susceptible to egg laying.

there and will have to be reincorporated into this new addition.”

Svendsen is the other contributor and notes the previous guide was far more general than the one he and Olfert have worked on.

“That one covered everything from soups to nuts,” Svendsen says. “It covered not just crop pests but animal pests and household pests, food pests, horticultural pests. This one is focused on those pests that only affect crops and forages in Western Canada.”

“ The range of beneficial insects is huge,” says the report’s lead author, Owen Olfert. The new report aims to help producers manage those beneficials for better pest control, plus better bottom-line results The impact of spraying Too often, beneficials can get sideswiped by spraying operations. The AAFC report cites research that proves many parasites of canola pests are directly impacted by pesticide treatments during flowering, which is when many insects are especially active.

“For the most part, if the beneficials are present at the time an insecticide is applied, they’re likely to suffer the same fate as the pest species,” says Olfert.

Hummel thinks farmers are gaining awareness of the importance of beneficials and are doing an important job of chemical management.

“While there is still some collateral damage to beneficial insects, there is an increasing awareness that they’re important and they have a role to play, and therefore a consciousness of trying to minimize that damage that happens to beneficials,” Hummel says.

Hummel says farmers can promote beneficial insects with fair management of their agricultural chemicals, taking into account proper timing and chemical selection.

“If we’re using it at an inappropriate time, then we are unnecessarily April 2015

“That’s a very narrow period of time, so we’ve stressed to spray only during that time if there is a sufficient economic threshold to warrant the control,” says Olfert. “If they’re spraying too early or spraying after that period of time, first of all, they’re wasting their money, and second, they’re doing more damage to the biocontrol agents than the actual population of pests.”

How to determine economic threshold is changing as a new model emerges that takes beneficials into account, says Erl Svendsen, AAFC senior environment resource specialist.

“Given a certain number of pests and natural enemies, that economic threshold shifts dramatically. The idea is if you have enough natural enemies, you may not have to go out and spray,” says Svendsen.

New field guide Another resource is the updated illustrated field guide of crop and forage pests, last produced around 1989.

“In those 25 years, we’ve had quite a number of new alien invasive species show up,” says Olfert, who originally started this project. “But on the other hand, anything that was native is still

The previous guide also sported a fairly small single picture of each insect, whereas the updated one attempts to capture the major important life stages of pests and the damage they can inflict.

“If you’re going out into a field and you see a particular pattern, it narrows down what pest could be impacting your crop,” says Svendsen.

The new guide will also link the beneficials, economic thresholds and other data. “We don’t know all the answers for those questions, but that information as much as possible has been included in this new manual. In the old version, there was no economic threshold, or management or conservation advice,” Svendsen says.

The guide is being released this spring, with additional copies available for this summer. It will also be available online as a downloadable pdf that will offer a number of features, including hyperlinking to other sources of information. CG country-guide.ca 47

CropsGuide

By Ron Friesen

you’ll like these insects Flea beetles that eat leafy spurge are only the first wave of biological weed control hat is it about weeds? No matter how hard you try to eradicate them, they always come back.

Worse still, each method of weed control has its drawbacks. Spraying with herbicides can lead to weed resistance if the same product is used continuously. Tillage can result in soil erosion (remember the Dirty ’30s?), and although cursing makes you feel a bit better, it has absolutely no effect at all on the weeds themselves.

But there is another form of weed management that can be cheap and effective if you’re willing to wait a long time. It’s called biological control and it involves using specific insects to eat certain weeds, if not into oblivion, then close to it.

“It’s definitely one of the tools in the tool box,” says Beverly Dunlop, a range and forage biologist with Agriculture and Agri-Food Canada in Brandon, Man. Dunlop would know. She works with the Leafy

Spurge Stakeholders Group, a coalition of government, agricultural and conservation groups examining ways to prevent and control leafy spurge, a noxious weed, in Manitoba.

There are many ways to control leafy spurge, with varying degrees of success. Herbicides will contain but not eradicate it. Cultivation is practical only on cropland, not rangeland where most of the weed is found. (Besides, fragments of cultivated roots will quickly form new plants.) Digging or hand pulling is impractical except in small patches. Mowing has to be done repeatedly to keep leafy spurge plants from going to seed. Sheep and goats will eat leafy spurge but having enough of those animals to provide widespread control is unrealistic.

Enter the lowly flea beetle.

Since the 1990s, the Leafy Spurge Stakeholders Group (LSSG) has been releasing batches of insects which feed solely on leafy spurge in selected locations

“ These are insects that have co-evolved with the particular target weed,” explains Robert Bourchier, AAFC biocontrol researcher at Lethbridge. “They are screened to ensure their specificity.”

48 country-guide.ca

April 2015

biocontrol as a means of weed control. Although 14 different foreign insects have been released against leafy spurge over the years, the most successful have been five flea beetle species in the genus Apthona.

The larvae feed on the roots of leafy spurge and the adults defoliate the weed before it can set seed. In the early 2000s, entire hillsides in western Manitoba once covered with leafy spurge had become bare of the weed, thanks to those insects.

Since that time, research projects have abated and leafy spurge has crept back.

Dunlop is trying to revive projects and revisit former sites to see if beetle populations can be re-established.

“What we need to do is to get more interest in biological control, show some good case studies and get interest built up again,” Dunlop says. “The results are there.”

Employing flea beetles to control leafy spurge, dubbed by the LSSG as Manitoba’s most unwanted weed, is one example of using an organism to regulate the population of another pest organism. It’s what scientists call classical biological control — controlling pests introduced from another region by importing specialized natural enemies of those pests from their native home.

“These are insects that have co-evolved with the particular target weed in their country of origin and they’re screened to ensure their specificity in order to bring them over here,” says Robert Bourchier, an entomologist and biocontrol researcher with Agriculture and AgriFood Canada in Lethbridge, Alta.

There are several advantages to biological control. It’s very specific because the predator insect will control only the pest it’s meant to target, unlike chemicals which can destroy good plants as well as bad ones. It takes little effort to keep a biological control system running, because the beetles can sustain themselves. It’s self-perpetuating and the insects need to be applied only once, unlike chemicals which must be applied continuously. It can also be very effective. Dunlop says she has seen 20-acre sites in Saskatchewan once covered in leafy spurge which the insects have since chewed down to nearly nothing.

Even so, biological control has one great disadvantage. It’s a very slow process which takes time to become effective.

The first challenge is to find the proper insects for the task. Bourchier says it can take 10 years of testing to make sure the insects being released are April 2015

AAFC’s Robert Bourchier, seen here with his research team, says finding natural insect predators for weeds is the first step in biocontrol efforts. the right ones. It then requires several years to establish populations which can survive our winters. Finally, populations must be large enough when released to have a noticeable impact. It takes time to multiply these populations.

But when the insects are finally turned loose, the effect can be noticeable in a fairly short time. Bourchier says one long-running project in southern Alberta, involving different insects on hound’s tongue (a noxious biennial taproot weed), managed to eliminate the weed at certain locations within two to three years.

It can be expensive to set up a biological control system. Bourchier says the cost of getting a biocontrol agent on the ground is somewhere between one million and two million dollars over 10 years. But the system is cheap in the long run, especially compared to developing a new herbicide, which costs tens of millions of dollars or more.

Bourchier says biological control isn’t the best method to use on a new weed because quick action is critical to keep it from becoming established. But in the case of leafy spurge, which arrived in North America in the 19th century and subsequently became established in Western Canada, biological control to slow its spread can be useful.

Bourchier says biological control is not commonly used in commercial crops because the weeds are not suitable targets. But it can be effective in environmentally sensitive areas, such as riparian zones, wetlands or parks, where you don’t want to apply herbicides too close to water or people.

Although only a small player in an integrated pest management program, biological control could play a more

important role at a time when pesticide costs are rising and herbicide-resistant weeds are becoming more prevalent, Bourchier suggests.

“By nature it’s specific and targeted toward a single species, whereas herbicides tend to be more broad spectrum, which is a benefit but also a cost,” Bourchier says.

Controlling weeds with insects made its debut in Canada in the early 1950s with the release of an agent to control St. John’s wort in Ontario and British Columbia. Since then, about 20 weeds have been targeted with 75 different insects throughout the country.

Supporters of biological pest control call it an environmentally safe way to control pests without using toxic chemicals. But there are risks. A classic example is the cane toad, introduced into Australia in 1935 to control beetles in sugar cane crops. Without natural enemies, this poisonous creature has since become an invasive species spreading throughout northern and western Australia, forcing the Australian government to develop a national cane toad control plan.

Such examples have some environmental groups warning against “frankenbugs” and raising fears that biological control may be a cure worse than the disease.

But Bourchier rejects those concerns.

He points out the type of screening done for biocontrol agents these days is very different. Regulations and oversight have changed dramatically since the 1930s and programs select for “specificity” — agents that work only on a single pest and cannot survive without it.

Says Bourchier: “You would never get approval to release cane toads in Australia today.” CG country-guide.ca 49

CropsGuide

By Richard Kamchen

outlook 2015 With all the day-by-day and minute-by-minute noise that rocks today’s grain and oilseed trading, it can seem impossible to pick out the vital messages that the market is actually sending. Country Guide sent veteran ag reporter Richard Kamchen to Wild Oats GrainWorld in Winnipeg this winter to listen for the home truths about 2015’s grain and soil crops, and to report back on the key issues that will shape our markets throughout the year. You’ll like some of what he heard. Other parts, not quite so much.

Barley Tight stocks and poor quality are driving bids in malt markets, and even in feed. But will those prices last?

M

altsters and feeders are having a tough time coping with tight barley stocks. Buyers were thrown for a loop in 2014 as high moisture during harvest decimated quality throughout the barley-growing areas of the U.S. and Canada.

“We’re used to seeing a bad barley malting crop in one region or another, but it’s not very often we see a wipeout right from Idaho up to northern Saskatchewan,” Lorelle Selinger, Cargill Malt’s North American merchandising manager, said at Wild Oats GrainWorld.

While yields were near average, quality was not, and acceptance rates were very, very low.

“We faced a lot of DON issues this year, a lot of sprouting issues, which for malting barley is obviously a concern,” Selinger said.

It’s not the first time maltsters have been against the wall. Coming out of the 2012 crop year, Canada had its lowest historic carry-out stocks. This caused some real anxiety before 2013 saw pressures ease with extremely high yields and grades. But then another bad year followed, with reduced acres and terrible quality.

On their way into the 2015 crop year, buyers face

“ With this huge increase in the production of craft beer, the demand for malt in North America is increasing.” — Lorelle Selinger, Cargill not only their tightest carry-out stocks in history, but probably the worst-quality carry-out too.

“That’s going to make it really tough for some of us maltsters to find a barley we need to get us into new crop,” Selinger said, adding that buyers are importing malt-quality stocks from Europe to compensate for the shortfall.

Due to its growing reliance on Canada, the U.S. is having to do likewise. Its production and ending stocks have been a little less volatile, but with U.S. demand for malting barley increasing, its supplies keep getting tighter.

50 country-guide.ca

The combination of higher cross-border shipments to the U.S. plus falling Canadian barley acres also means that Canada is becoming a smaller player on the global stage than it has been historically.

Taking Canada’s spot is Argentina, which has become a significant player over the past decade to the point of developing the capability to export up to three million tonnes of malting-quality barley a year.

Favourable to Canadian barley acres in 2015, however, is that a lot of other grain prices are a little lower, and Selinger suspected there will be a slight jump in acres in 2015 in both Canada and the U.S. Robert Saik, CEO of Agri-Trend Group of Companies, was far more bullish, predicting barley acres will soar 22 per cent to 7.2 million acres, pulled up by malt industry demands: “Barley could be a real alternative in some areas, I think we’ll see that,” Saik said.

Selinger, however, thought sourcing malt barley domestically would continue to be a struggle.

“We’re just not producing as much barley to pick from as we’re used to,” she said, pointing out that as recently as 2003, Canada seeded over 12 million acres.

Global barley production has also been on the decline — both feed and malting — for many years now, and while needs are currently being met, beer demand continues to increase.

Beer production has steadily grown over the last 25 years, including another increase in 2014. The U.S. remains the primary importer of beer and China the primary consumer.

Beer drives malting barley demand and “on the global front, it’s forecast beer sales are going to rise over the next five years at quite a significant pace to what it has risen historically,” said Selinger.

Part of this increase reflects the growth of premium beers. In North America, craft beer production has markedly boosted demand.

“In 1990, there were about 400 registered craft breweries. This year they figure over 4,000. So they’re becoming a much bigger player. And why that’s important to barley is the average craft beer will use 90 to 100 per cent malt content. The average commercial beer, some of it will only have 40 or 50 per cent, and April 2015

grain marketing using adjuncts for the rest,” Selinger said.

“So with this huge increase in the production of craft beer, the demand for malt in North America is increasing.”

Feed tight too Supplies are also tight in feed barley, but buyers are switching to alternative grains as barley prices itself out of feed rations.

Prairie production of 7.1 million tonnes in 2014 represented the smallest crop since 1968, and 2014’s seeded acres of 5.5 million were the lowest since 1964, said Steve Bloss, Maple Leaf Food’s manager of purchasing and risk management.

He called 1996 the last year of significant Prairie barley acreage.

“Barley acreage throughout the three Prairie provinces has trended sharply lower ever since. This is really hard for us as grain buyers,” Bloss said, adding Manitoba has had minimal barley stocks to pursue. “If you look at Manitoba, we were just 300,000 acres of barley last year.

That’s down 80 per cent from 1996.”

With maltsters having paid large premiums for malting barley, however, farmers might be lured back in 2015, Bloss said.

“We think there’s going to be a bit of a rebound in barley,” Bloss said, noting trade estimates range from 10 to 15 per cent. But even a 15 per cent gain would still result in tight stocks, he added. “Our carry-out, we’re sitting at 900,000 tonnes. The trade is using a much lower number. We’re hearing numbers anywhere from 600,000. But anything under one million tonnes for barley carryout is extremely tight.”

The high price of feed barley, though, is causing buyers to look at alternatives.

Feed-quality barley and wheat have been trading at par in southern Alberta, with sharp barley premiums versus other feed grains in Manitoba.

“Low-vomitoxin feed barley is actually trending upwards of 120 per cent of the price of corn,” said Bloss. That adds up to switching to more corn and wheat.

“Our company’s got five feed mills throughout the province. We probably buy somewhere in the neighbourhood of 430,000 tonnes of feed grains per year — it doesn’t have to be feed barley.”

Bloss also anticipated that barley price spreads against alternative ingredients would remain strong. “We have to look at the price spread between the three grains,” Blass said. “I really think with this kind of balance sheet for next year, we’re going to continue to see lower inclusions in our least-cost formulations.”

April 2015

Oilseeds The thrill may be ebbing for canola, while excitement builds for soybeans and flaxseed

I

n a rare twist, canola is expected to lag behind the acreage jumps of other Prairie oilseeds in 2015.

Robert Saik, CEO of Agri-Trend Group of Companies told Wild Oats GrainWorld that farmers haven’t absolutely finalized their cropping plans for 2015. But whatever happens, he believed rail logistics would play a part in planting intentions.

“Rail and transportation logistics issues are figuring into crop programing. (Farmers) are reticent to plant crops when they still have the old crop in the bin and no sign of moving it. The decline in rail transportation since November will keep farm stocks high and a widening basis level on export crops especially,” said Saik.

Saik predicted Canadian canola area in 2015 would be almost identical to last year at 20.4 million acres, but Brian Conn, Louis Dreyfus Commodities’ vice-president of Canadian oilseeds, anticipated a 4.5 per cent decline to 19.4 million acres. Conn thought Manitoba would be losing the largest percentage of canola acres as farmers grew more corn and soybeans.

With lower acreage, the table would be set for reduced production, which Conn pegged at 15.14 million tonnes versus 15.56 million in 2014, and the record 18.03 million tonnes of 2013.

Canadian exports of 2015-crop canola could decline to 8.11 million tonnes from 8.57 million anticipated in 2014 and the record of over nine million in 2013-14, Conn added. He saw the largest demand drop coming from China, which he expected would purchase 3.18 million tonnes of canola from Canada, down from 3.4 million in this current crop year.

“Over the last five years, our exports to China are really a big swing factor in terms of what overall exports are going to be,” Conn said.

Domestic canola demand, however, is on the rise. Conn estimated the 2014-crop domestic crush between 7.1 million and 7.2 million tonnes — up about 200,000 tonnes from the previous year — and a record eight million tonnes in the 2015 crop year.

“We think from a capacity utilization standpoint, it makes sense to start with a higher number until we see otherwise,” said Conn.

Agriculture Canada oilseeds analyst Chris Beckman.

Conn added that Cargill is completing its new plant in Camrose, Alberta, which will add over 2,500 tonnes of daily capacity in the second quarter of 2015, while Richardson is planning to expand its Lethbridge plant to boost capacity to over 1,200 tonnes a day by mid-2016.

The soybeans bounce A bearish outlook for world soybean markets hasn’t tarnished the crop for Prairie growers.

Agriculture Canada oilseeds analyst Chris Beckman pointed out Canada’s soybean area has doubled over the past 10 years, driven by western Canadian expansion, which has tripled.

Continued on page 52

country-guide.ca 51

CropsGuide Continued from page 51 For 2015, he forecast Canadian soybean production to rise by about 10 per cent to 6.7 million tonnes, based on increased area and higher yields. Soybean area in Western Canada in 2015 could increase by about 20 per cent to slightly under two million acres, Beckman said.

Saskatchewan soybean area is forecast up by about 50 per cent to a little under 500,000 acres, while Manitoba’s rises by about 10 per cent.

“Over the long run, I think there’s good potential to grow the crops at roughly the same size as peas in Saskatchewan,

which is… about two million to five million acres,” Beckman said.

Western expansion is being driven by agronomics and economics. Soybeans require fewer inputs than canola and present a different disease profile than either wheat or canola, Beckman said.

Plus, there’s a growing world demand for edible oils and protein.

“The scope and pace of expansion across Western Canada depends on the pace of release of lower heat unit varieties,” Beckman added.

But as soybean production moves westward, he anticipated national yields falling off.

Brian Conn, Louis Dreyfus Commodities’ vice-president of Canadian oilseeds.

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52 country-guide.ca

April 2015

grain marketing “Yields in Western Canada are lower than Eastern Canada because of the lower temperatures and drier growing conditions, so as the cropping area expands westwards, the pressure will be to reduce national yields despite the continuous release of new and improved soybean varieties,” Beckman said.

While domestic crush remains stable at 1.6 million tonnes, he forecast exports up about 12 per cent to 4.8 million tonnes in 2015.

Soybeans are Canada’s fourth-largest export crop, “and depending on expansion area and what happens on durum, they’re battling to become No. 3,” Beckman said.

Flaxseed set to rise Flaxseed area is on the rise too, but more to levels that were typical prior to when traces of Triffid disrupted Canada’s exports to the EU. Saik estimated 2015 flaxseed area would increase 13 per cent to 1.8 million acres.

“We’re getting back to those pre-2009 levels of supply, and the industry is recovering,” said Chuck Penner, president of LeftField Commodity Research.

Penner noted 2014 acreage was up significantly and heavily concentrated in Saskatchewan. Although 2014 flax production reached over 800,000 tonnes, it included

more poor quality. Exports have returned to previously attained levels, but the destinations have altered.

“We’re back to about a 640,000-tonne export program. So the total volumes are back to where they were before, and that’s very positive. But the composition is very different. Europe is in the market for about a quarter of the crop, the U.S. for another quarter, but China is taking almost half of it,” said Penner. “I think China is going to present a larger opportunity for sustaining (acreage) growth of back up to the 1.5- to 2.0-million-acre mark.”

Continued on page 54

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CropsGuide WHEAT Extreme volatility could hit wheat, while lofty prices in durum may return to Earth

T

he crisis in Ukraine and unknown weather events have market bears on high alert, Lawrence Yakielashek, general manager of FarmLink Marketing Solutions, said at this year’s Wild Oats GrainWorld conference. Although the bears may have been winning the day, some commodity funds have indicated to him they’re reversing their short positions and getting long in deferred months.

“We’re going to see some extreme volatility in the wheat market,” Yakielashek said. “We believe the spring months are going to be the time when the fireworks are going to start hitting the match.”

In Ukraine, economic conditions continue to worsen and may be graver than is being reported in the media. Interest rates are high and cash-starved farmers are selling crops they might under normal circumstances have held on to. Approximately 8,100 square miles of land in Ukraine are under turmoil, and some of the crops there remain standing in the fields unharvested.

About 25 per cent of the country’s winter wheat crop is in bad shape, and farmers there may end up planting less wheat and reducing their fertilizer and herbicide usage.

“Currently, planting costs in Ukraine are up about 150 per cent over last year,” Yakielashek said. “If you want to borrow some money, you have to pay 19.5 per cent, and input costs are up substantially. So what we might see in Ukraine is actually lower production.”

And while any reductions in Ukraine are unlikely to prevent 2014 world wheat ending stocks from

Alan Hegemeier, merchandiser for CHS Inc. 54 country-guide.ca

reaching their ninth record high in the last 20 years, demand is surging. Global consumption has increased over the last five years by nine per cent, or 62 million tonnes, Yakielashek noted. World wheat consumption today is 1.95 million tonnes per day, and demand could climb another 2.1 per cent in 2015, he added.

In Canada, supplies are tight. Yakielashek predicted carry-out would be down this year by about 30 per cent to 5.5 million tonnes. Even if 2015 production reached 23.5 million tonnes — a high estimate — supplies would still shrink. (Robert Saik, CEO of Agri-Trend Group of Companies, believed non-durum Canadian wheat-seeded acres would fall six per cent in 2015 to 17.9 million acres.)

“Even with a four per cent lower export figure for next year, we have a tight carry-out of just maybe four million tonnes, down 28 per cent from the current potential carry-out of the 2014-15 crop year,” Yakielashek said.

But an expected rise in crude oil prices would be no boon for Canadian farmers. As crude goes, so goes Canada’s currency, and Yakielashek said current forecasts are suggesting crude oil could return to $66 to $76 per barrel by the end of 2015. If that happens, the loonie could surge to about US87 cents and hit wheat prices by about 50 cents a bushel, he predicted.

Durum uncertain While good returns in durum could boost Canadian acres, there’s no way of knowing what’s in store for farmers who plant the crop this spring.

Saik estimated Canadian durum area would increase 15 per cent to 5.5 million acres, but it’s unclear whether growers will enjoy another year of premium prices.

Alan Hegemeier, merchandiser for CHS Inc., has heard rumblings of a 20 per cent acreage boost, and that would definitely get the attention of buyers, especially if the harvested crop ended up high quality.

As well, good crops in North Africa and the EU would guarantee an end to the party.

Quality might be the name of the durum game, but buyers’ ability to adapt to poor crops last year could endanger the premiums they’d previously been willing to pay for top grades.

“The EU just had poor timing in its crop; right before harvest there was a lot of rain. Morocco usually takes nothing but No. 1 wheat — it won’t even look at anything else — but this year, it took 3s…

Same thing with Algeria,” noted Hegemeier. “The interesting thing for next year is, will they pay the premium for the higher quality, or will they continue to grind the lower quality at the lower price?

It’s the same story in the U.S. with the domestic mills. We’ve forced them to get by with less, and now they’ve figured out a way to make it work.” CG April 2015

w e at h e r NEAR NORMAL

COOLER THAN NORMAL

MILDER THAN NORMAL

Showers Flurries Cold WARMER THAN USUAL

Ch a Sh nge Ma ow ab y f ery le ro st

BRITISH COLUMBIA

May 3-9: Variable weather as warm, dry days interchange with cooler, wet days and some frost. Chance snow. Blustery.

May 10-16: Warm, often sunny but some rain, windy on a couple of days. Chance of snow. Widespread frost possible on two or three nights.

May 17-23: Mostly sunny but with a few passing showers or heavier thunderstorms.

Frost pockets in a few localities.

May 24-30: Weather fluctuates as sunshine gives way to showers or thunderstorms. Frost risk south, more common central and north.

May 31-June 6: Sunny but with a few showers and isolated thunderstorms, heavy in places. Highs often in the 20s south, teens north.

June 7-13: Warm and mainly sunny on several days apart from scattered showers April 2015

NEAR-NORMAL TEMPERATURES AND PRECIPITATION

ble Changeary Showe

May 3 to June 13, 2015

May 3-9: Sunny most days. Temperatures seasonal east, but warm west. Rain or showers fall on a couple of cooler, windy days.

May 10-16: Highs in the teens on the coast, 20s Interior but frost at higher levels and north. Showers on two or three days.

May 17-23: Pleasant and warm apart from scattered shower activity and brisk winds.

Frost pockets at higher levels and north.

May 24-30: Seasonal to warm except frost threat north and higher elevations. Sunshine alternates with showers, heavy in places.

May 31-June 6: Mainly sunny with scattered showers. Highs from the upper teens on the coast to 20s inland and possible 30s Interior.

June 7-13: Sunshine on several days apart from scattered showers west and isolated thunderstorms east. Seasonal to warm.

ALBERTA

COLDER THAN NORMAL

Sh Mil o d sp we ell ry s

ild rs M we o Sh

ol ells o C sp et W

or heavy thunderstorms on two to three occasions.

SASKATCHEWAN

May 3-9: Seasonal and at times cool with nighttime frost. Sunny skies alternate with showers or rain. Windy.

May 10-16: Variable temperatures and weather as sunny skies are followed by showers. Frost in a few areas, chance of snow. Blustery.

May 17-23: Warm, showery days with a few thunderstorms interspersed with windy, cooler and drier days. Frost in a few localities.

May 24-30: Pleasant in spite of a few showers or thunderstorms. Seasonal to warmer but frost risk south, more common central and north.

May 31-June 6: Sunny skies interchange with showers or heavier thunderstorms south. Cooler and at times wet north.

Occasionally windy.

June 7-13: Warmer, sunny south but with passing showers or heavy thunderstorms on a couple of days. Cooler, showery north.

MANITOBA

May 3-9: Seasonal to cool with occasional frost. Sunny apart from showers on a couple of occasions. Chance of snow. Blustery.

May 10-16: Variable temperatures with occasional nighttime frost. Sunny but showers or rain on a couple of windy, cooler days.

May 17-23: Mostly cool but also with a couple of warmer days and scattered showers or thunderstorms. Frost patches.

Often windy.

May 24-30: Seasonal with a frost risk south. Sunny but showers, chance heavy thunderstorms on two or three days. Scattered showers turning to snow north.

May 31-June 6: Variable from sunny and warm to cooler with wet periods. Blustery at times. Cooler and occasionally wet north.

June 7-13: Sunny south aside from passing showers or thunderstorms, heavy at a few localities. Often warm, humid. Cooler, showery north.

May 3 to June 13, 2015 NATIONAL HIGHLIGHTS Warmer- and drier-than-usual weather is expected to bring summer-like conditions to western British Columbia in this late-spring period. Contrasting winter-like weather is anticipated across much of the northern and easternmost regions of Canada with rain and snow well into June.

Elsewhere look for changeable weather as warmer air and longer days combine to create more seasonable conditions from eastern British Columbia through the Prairies and on into Ontario, southern Quebec and most of the Maritimes. In many of these areas, May and June are the wettest months of the year. Overall, however, expect precipitation and temperatures to average close to normal values.

Prepared by meteorologist Larry Romaniuk of Weatherite Services. Forecasts should be 80 per cent accurate for your area; expect variations by a day or two due to changeable speed of weather systems. country-guide.ca 55

h e a lt h

I’m sorry, could you repeat that?

By Marie Berry he number of times you say “Pardon me” may be the only sign you have that your hearing has gradually lessened. It happens with age, but even so, it’s important to recognize there are steps you can take to reduce your risk and to maximize your hearing.

About 10 per cent of all Canadians have hearing loss, but as you would expect, the numbers do jump as age increases. At 45 years of age, only about 20 per cent are affected, but by age 65 it’s about 60 per cent of people. Men are more often affected than women, which may be related to noise exposure at work.

It is also thought these numbers should actually be higher because hearing loss is so gradual that it is not noticed, or because it is denied.

There are two components to hearing. Conductive hearing loss occurs when sounds are prevented from getting to the middle or inner ear, for example because of impacted earwax, a foreign body, water, or even an ear infection. Removal of the obstacle will solve this type of hearing loss.

By contrast, sensorineural hearing loss involves the inner ear and the nervous system. Unfortunately, this kind of hearing loss is usually permanent.

Your ear has three parts: the outer ear which is the part that you see, the middle ear where hearing is sensed, and the inner ear which is responsible for sending sound messages to the brain for interpretation.

Incidently, the inner ear is all important in maintaining your balance, which often means that damage to the inner ear will affect both your balance and hearing.

Earaches can affect any part of your ear and reduce your hearing. Infections, a foreign body, trauma such as a blow to the ear, or even something like swimmer’s ear can be the cause, but once the earache clears your hearing returns to normal.

Earwax or cerumen can be a problem if it accumulates and plugs the ear canal. Earwax is a mixture of secretions from both sweat and earwax glands. If you are older, have narrow or misshapen ear canals, wear a hearing aid, or even have lots of hair in your ears, earwax can readily accumulate and become impacted. There are various earwax removal products available, but you need to read and follow the instructions carefully. And, if you are unsuccessful, don’t just try another product, have your ears checked first.

If you notice that your hearing has changed and you have begun taking a new medication, ask if hearing loss may be an adverse effect.

Some drugs can affect your hearing. Drugs with the potential to reduce hearing by affecting the nerves that sense sound include antibiotics like gentamicin, tetracycline, and erythromycin; the leg cramp remedy quinine; some cancer drugs; and nonsteroidal anti-inflammatory drugs like ibuprofen and acetylsalicylic acid. This effect typically occurs over time and, usually, stopping the drug halts the loss, although hearing may not return completely.

Acetylsalicylic acid in higher doses can also cause tinnitus or ringing in your ears. The ringing may not develop into hearing loss, but it certainly interferes with hearing. Again, stopping the drug will alleviate the effect, but even reducing the dose may do the trick.

Hearing loss does increase with age, but that doesn’t mean it’s inevitable. These steps can help provide lifelong hearing protection Your ears are considered to be self cleaning and you shouldn’t need to do anything else other than wash your external ear, for example when you are shampooing your hair. Don’t try to “dig out” anything from your ear, earwax included! You may push whatever you are trying to remove further into your ear. Ideally, you want to put nothing smaller than your elbow in your ear, if that’s even possible!

Take care of your hearing by wearing ear protection when you are exposed to loud noises, such as machinery or rock music. And, if you wear a hearing aid, always remember to make sure it has fresh batteries and that it fits properly. Getting older is no reason why you shouldn’t have good hearing.

Marie Berry is a lawyer/pharmacist interested in health and education.

Pregnancy warnings seem to be everywhere these days. Of course you shouldn’t drink alcohol or smoke during pregnancy, but you may be unsure if you can take any drugs while pregnant. Next month, we’ll look at drugs and pregnancy.

56 country-guide.ca

April 2015

HAVE YOU GOT IT? “We went to church and no one, not one person, spoke to us.” Derek and Heather Punshon are regulars at the church we attend in Saskatoon. They attended church while on vacation and were ignored. People gathered in clusters at the coffee hour following the service but did not include the Punshons. Derek and Heather are an outgoing couple with pleasant dispositions. They are not easily riled but the experience “ruffled their feathers.”

As Derek and Heather described the church service, I recognized the formula. The clergy designed the worship hoping newcomers would feel comfortable. Unfortunately, their efforts to be “user friendly” failed the Punshons, and perhaps others.

More is required than planning a service, printing bulletins and writing a sermon. People will come back another Sunday if there is personal contact and encouragement to return.

It takes a certain amount of courage to walk into any strange place. I think venturing into a new church is scary.

Churches have personalities. They have characteristics which define them beyond the shape of the building.

Most churches have an image of themselves as friendly and welcoming. In all fairness, churches are eager to receive newcomers and want them to feel at home. Contrary messages work against those hopes. Did you visit a church and feel your car was parked in another person’s space? Did you get the impression that you were sitting in someone else’s pew? Did anyone make an effort to learn your name and ask if you had a question? Visitors come and go. Churches have an opportunity to show warmth and friendliness to people who drop in. Sometimes they blow it.

A restaurant posted a prominent sign “Guests are not to stay beyond one hour.” Churches have their own signs, although not as clear or blatant as that. Usually they are read in the faces, smiles (or lack of smiles), and tone of voice of members.

It does not take much to show genuine interest. Often it’s nothing more than a great smile that seals the deal.

Desmond Tutu spent his life advocating for justice and fairness. He was instrumental in the dismantling of apartheid in South Africa. He became the first black archbishop in Africa. When he was a young boy, his family moved to the City of Johannesburg. Tutu’s father worked as a teacher, and his mother was a cleaning lady and cook at a school for blind children. Desmond Tutu, nine years old, met a priest named Trevor Huddleston at the school. Tutu calls the meeting the most defining moment in his life.

Huddleston, an English bishop known for his fight against apartheid, was a priest in the slums at that time. The child Tutu witnessed this tall white priest (Huddleston) take off his hat to greet Tutu’s mother, a black working-class woman. Tutu never forgot this gesture and it gave him the passion to fight apartheid later on in his life.

A writer named George Lewis says, “All of our efforts toward reform and renewal are utterly futile unless we have grasped the simple fact of Christian life that the church is people.”

A minister preached a very long sermon. When it finally ended a friendly lady noticed a newcomer in the congregation. She moved across the aisle to offer a welcome. “Hello,” she said, “I am Gladys Dunn.” “So am I glad he’s done” answered the visitor.

Suggested Scripture: Leviticus 19:33-34, Colossians 3:12-17

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Rod Andrews is a retired Anglican bishop. He lives in Saskatoon. ©2015 Farm Business Communications

April 2015

country-guide.ca 57

acres

When tomorrow comes...

By Leeann Minogue

Maybe someone will lose those stupid signs anyway he first day, Dale found ways to cope with the frustration. He watched from his truck, driving out to the field and back. He paced the yard, if hopping around the yard on crutches could be called pacing. He phoned his son, texted his father.

But by 10 a.m. on Day 2, Dale hit the wall.

“I’m going to run the tractor,” he announced to his wife when she brought their grandchildren outside to see what he was up to.

“They can get by without you,” Donna said.

“Jeff’s running the tractor. Elaine and your dad are doing fine keeping the cart loaded. And Jeff says Alan’s doing fine picking rocks.”

“Alan’s only been working here for 15 minutes.

We can’t put all our eggs in his basket.”

“You’re still taking painkillers,” Donna said, giving him a hard glare. “It’s right on the label: ‘No heavy machinery.’”

“I haven’t taken any pills all day,” he said triumphantly.

“That explains all that moaning I heard when you thought I wasn’t in the room,” Donna said.

Dale had been in a lot of pain since he’d broken his ankle falling off the top platform of the grain cart, changing the tank lid seals two weeks earlier.

But the physical pain was nowhere near as bad as the pain of not being part of spring seeding.

Before noon Dale had convinced the rest of the crew that he was perfectly able to run the tractor.

His son Jeff had given in reluctantly, mainly because they also had a customer coming to the farm to pick up seed, someone had to go to town for more fertilizer and Alan had already hit a fence with the rock picker.

Dale had a tough time making his way up into the cab, carrying his cooler full of lunch in one hand and clutching his crutches under an arm. But he managed to use his free hand and one good leg to pull himself up the ladder.

58 country-guide.ca

Dale was happy to be back in the cab. It was a huge relief for him to finally do something useful, and this was his favourite field to seed. It was just north of the Hanson farm, and this time of day every time Dale came up over the hill he could see the sun glinting off the bins at the edge of the yard.

It was also the field closest to the road — the field that all the neighbours would be sure to associate with the Hansons, and the field with the potential to make him the most proud of the operation.

This was going to be the year, all right, Dale thought. The soil was moist, but not too wet.

They’d done soil tests and with what they were adding, there should be nitrogen to spare. His ankle barely hurt at all. That new song he liked came on the radio, so Dale turned it up.

The throbbing in his ankle picked up as the afternoon went on. By 5, it was getting hard for him to think about anything else, but he was almost finished with this quarter. He stopped at the corner of the field closest to the house, next to the road, where Ed and Alan were waiting with the trucks.

Dale couldn’t get out of the cab to help out. He hoped nobody would drive by and see him, just sitting there like a lump while everybody else did the work. Or, if anybody did drive by, Dale sure as heck hoped it would be somebody who knew about his ankle, so they wouldn’t think he’d got lazy. Or worse yet, old.

Ed and Alan finished up. They shut off the augers and waved him off. Dale pulled out, being extra careful to edge around the power pole — close, but not too close.

Then his stomach tightened as the wheels started to spin. It was much wetter in that low spot by the pole than Dale had expected. He didn’t breathe again until the wheels caught and he was back in motion, just in time to notice Ralph, crawling by on the road with the grader, waving. If Ralph saw him do anything stupid, it would be all over the RM April 2015

acres

before morning. Dale waved back, hoping Ralph hadn’t noticed that he’d almost gotten stuck, or that he’d been just sitting around while the guys filled the cart.

And suddenly the alarm was going off and his phone was ringing and the radio was way too loud. He swung around in his seat to see what was going on and banged his left leg on the steering column. “Damn ankle!” he cursed.

“Damn phone!” And then he cursed again. He’d left the fan off.

He switched it on. How far had he gone? Thirty? Forty feet? Thirty feet with no seed in the drill? A long empty stretch right by the road. But it wouldn’t be empty would it?

There’d be a patch of weeds twice as big as the damn garden.

Could he turn around and take another run at this spot? Not without Ed and Alan seeing him. And Ralph too, of course. And now there was a pickup truck going by. And another one coming from the south. Jim Callum, slowing down to take a good look. They would all know exactly what he’d done if he turned around. And next time through, he’d probably get stuck to boot.

“Damn drill,” Dale shouted, and kept on going. “Why do they make them so damn wide?”

This was the worst possible place for a weedy mess.

It couldn’t be closer to the house. The road. Dale was mortified. Horrified. Embarrassed. Could he even get his pounding ankle out of the cab if this stress made him throw up? How would he tell Jeff?

Dale held himself together for 20 more minutes, when Jeff drove out. Dale stopped the tractor and Jeff climbed up.

“I ate early, Dad,” Jeff said. “You’ve put in a long enough day. Go in. Mom’s got supper for you. And take something for that ankle — looks like you’re in pain.

“Yeah,” Dale said. “Listen, Jeff…”

“I know we said we could do it without you,” Jeff told Dale, “but I’m not really sure how. It’s great of you to come out here, with that leg.”

“About that…,” Dale started, but Jeff interrupted again.

“Dad, I just want you to know. I don’t how I could keep this farm going if something happened to you.”

“But there’s a…,” Dale tried.

“You’ve taught me a lot about this. I don’t say thank you enough.”

Dale didn’t have the heart to try again. Maybe by the time the crop came up, everybody would forget who’d seeded this field.

Jeff’s phone rang while Dale was still struggling to drag his cast through the door of the cab.

“Yeah, sure,” Jeff was saying. “We’ll put those variety signs up right in the field Dad just seeded. It’ll be perfect.

Right by my house. Field’s in good shape. Ship ’em out as soon as you can.”

Dale put his crutches under his arms and headed home.

Leeann Minogue is the editor of Grainews, a playwright and part of a family grain farm in southeastern Saskatchewan.

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country-guide.ca 59

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©2015 CNH Industrial America LLC. All rights reserved. Case IH is a trademark registered in the United States and many other countries, owned by or licensed to CNH Industrial N.V., its subsidiaries or affiliates. www.caseih.com