Cgw140909

WESTERN EDITION

country-guide.ca

September 2014 $3.50

STAN JEEVES

GO TO MARKET BUILDING A PLAN THAT WORKS PG. 26

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SHHH! YOUR NEIGHBOURS DON’T HAVE A SUCCESSION PLAN EITHER PROFESSIONAL TIPS TO GET MORE FROM THIS YEAR’S GRAIN PRICING HOW TO FIRE THAT EMPLOYEE, WITHOUT GETTING SUED

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BE READY.

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CONTENTS

SEPTEMBER 2014

BUSINESS 10

THE OTHER SIDE

12

THE OLD WORLD GOES NEW

16

WICKED PROBLEM

20

LOOKING FOR A SAFE BET

22

MAKE THE MOST FROM THE 2014 MARKET

30

WHEN GOOD DEEDS ARE GOOD BUSINESS

33

THE CONSUMER CONNECTION

35

GUIDE HR — MAKE A BETTER IMPRESSION

36

SUCCESSION SHOCK

38

GETTING THERE FROM HERE

42

IT’S ALL DIFFERENT NOW

44

SWEDE HAWK

46

GUIDE LEGAL — FIRING AN EMPLOYEE

62

GUIDE LIFE — TOO YOUNG, TOO OLD

Uh, maybe you’re too competitive, says new biz book.

In Germany, this man’s farm really is his (subsidized) castle.

There’s a reason farming’s problems are so hard to solve.

With grain markets down, where are the opportunities?

Our Errol Anderson tells us how to score on grain sales.

For farm groups, the hot new trend is giving to food charities.

Maybe the gap between consumers and farmers isn’t so big.

Use this science to make the people around you like you more.

64 66

More and more farmers like Saskatchewan’s Stan Jeeves (above) and Manitoba’s Dale Gryba are bypassing the textbooks to create their own marketing plans, with an emphasis on practicality and dependability.

Succession is a journey, but don’t we still need a road map?

High land prices are driving innovation in land transfers.

Here’s why Väderstad builds corn planters in Saskatchewan.

Know the law before you tell that employee to take a hike.

Watch out! The generation gap is back with a vengeance.

PRODUCTION 47

JOIN THE CLUB

52

2014 HARVEST QUALITY

54

CUT CANOLA LATER, AND COMBINE SLOWER

GUIDE HEALTH

56

FARM DOLLARS MAKE THE DIFFERENCE

HANSON ACRES Who’s going to fill in for Grandpa Ed? Hey, I know…

58

MORE VALUE FROM SHELTERBELTS

EVERY ISSUE 8

PG. 26 CHARTING A PROFIT

So you think your neighbours have already signed their plan?

MACHINERY GUIDE

Those tractors aren’t just bigger. They’re better too.

Nobody wants to talk about warts, but these cures work.

Alberta is winning its clubroot fight. Will Saskatchewan?

Cigi’s crop quality reports help keep wheat flowing.

Field losses can be managed. Jay Whetter tells us how.

WGRF funding ensures better cereal varieties.

That old shelterbelt does much more than break the wind.

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SEPTEMBER 2014

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BayerCropScience.ca/InVigor or 1 888 283-6847 or contact your Bayer CropScience representative.

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O-66-07/14-10238268-E

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: bmvancamp@fbcpublishing.com Production Editor: Ralph Pearce (226) 448-4351 Email: ralph.pearce@fbcpublishing.com ADVERTISING SALES Dan Kuchma (204) 944-5560 Cell (204) 290-5419 Email: dan.kuchma@fbcpublishing.com Lillie Ann Morris (905) 838-2826 Email: lamorris@xplornet.com

Tom Button is editor of Country Guide magazine

There will be a winner If you take Canada’s inventory of farm machinery and multiply its working capacity times an average number of days for seeding, spraying or harvesting, how many acres will you top out at?

Can the average farm cover 20 per cent more acres than it is actually farming? Or 50 per cent?

Certainly it’s more than five years ago.

This isn’t to say that excess capacity is always bad. But even the machinery industry must agree that at some point, you cross the line into overspend.

Of course, as I have complained in past, our universities and our governments really aren’t much help. As a farmer, you can pretty easily leverage your checkoffs to breed higher-yielding or more diseaseresistant crop varieties, but you can’t get a publicly paid economist to work on issues that actually matter to commerical farms.

Anyway, given the scarcity of meaningful economic research in Canada, take a look at what you do know. Sit down for a half-hour, either with pen and paper or your notebook, and add up not only your own capacity, but also the capacity of the farms you know within, say, 15 or 20 miles of your home place.

Then compare that not only to the number of acres that are being farmed within that same radius, but also the amount of land that is coming up for sale, or that is available to new renters.

I keep coming back to the reporting that associate editor Maggie Van Camp 6 country-guide.ca

did just over a year ago into what happened to U.S. farmland prices the last time commodity prices went through such a steep dive as we’ve seen in 2014.

It was the 1980s, and of course, interest rates that were far higher than today.

Nevertheless, what Maggie found is that farmland prices didn’t collapse with the downturn in commodity prices.

In fact, U.S. researchers later documented a six-year lag between the drop in grain values and any significant response in land markets.

We’ll likely see the same in Canada this time around. Who would rush now to cut prices on large amounts of farmland? The number of sales may go down, but not the prices.

From the outside, you’d think it would create stagnation. But the U.S. evidence is that somehow the long-term trendlines continued for agriculture overall. America’s farm sector evolved. There were winners. There were losers. And farm size kept notching up.

The point is that there is a lot more evolution going on than we can actually see. Some farms are increasing their competitiveness. Others aren’t.

But the question I really don’t know the answer to is, are the winners going to be the farmers with equipment that will cover 150 per cent of their current holdings, or those with 110 per cent?

Let me know what you think. I’m at tom.button@fbcpublishing.com.

Head Office: 1666 Dublin Ave., Winnipeg, MB R3H 0H1 (204) 944-5765 Fax (204) 944-5562 Advertising Services Co-ordinator: Sharon Komoski Fax (204) 944-5562 (204) 944-5758 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. C ountry G uide is published 13 times per year by Farm Business Communications. Subscription rates in Canada — Farmer $39 for one year, $58 for 2 years, $83 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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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.

September 2014

Machinery

By Ralph Pearce, CG Production Editor

The high-powered parade in tractor technology continues. With each year, more manufacturers are rolling out more entries for this growing tractor segment. These machines are bigger and more powerful, and they are more capable than ever before.

They work larger tracts of land, haul heavier loads and deliver on a longer list of heavyweight tasks all around the farm. Below we showcase three of the latest series and models in the 325-horsepower and up category.

Whether you’re putting crop in the ground in the spring, or hauling it out of the field in the fall, the tendency on farms all across Canada is “Go Big — so you can Go Home!”

8 country-guide.ca

September 2014

Challenger MT800E Series Track Tractors  Four models, four levels of engine horsepower and the company’s determination to provide unmatched power, performance and productivity are the source of Challenger’s new MT800E series track tractors. With models ranging from 450 to 590 engine horsepower, the MT800E series combines rugged performance with reliability. Challenger engineers custom designed these tractors for farm and field applications, including the AGCO Power 16.8-litre diesel engines, featuring a compact design with two-stage turbochargers. Avoid downshifting or pulling an implement out of the ground by generating more torque rise across a wider range of r.p.m.s. That means you can lug more through your fields and maximize productivity. The Mobil-trac system and the patented oscillating mid-wheel undercarriage design means there’s superior ground contact yet less compaction, plus a smoother ride and improved fuel efficiency. And when the workday becomes a “work-night,” the MT800E models provide 360-degree visibility, for clear sight lines and enhanced comfort.

www.challenger-ag.us

 Case IH Steiger 370 – 620 Tractors

Deutz-Fahr 1100 Series

There are a lot of words and terms to describe high horsepower and superior performance. For Case IH, the only word you need to know is Steiger. Awarded Machine of the Year, 2014 at Agrictechnica in Germany, the updated Steiger series provides efficient power, unmatched four-wheel-drive adaptability, and loads of heavy-duty capability. Together, they translate into increased productivity, so you get more done with less. For four-wheel power, choose from 370-, 420- and 470-horsepower models. For heavy-duty action, the Steiger 580 HD and 620 HD tractors provide that added power to the ground for those tough spots in the field, or when there’s a need for added speed on the road. There’s even the choice of what the company calls the industry’s largest available row-crop tires, or Case IH’s Quadtracstyle tracks, to spread the operating weight and reduce compaction.

The company also says it is the first to offer a suspended cab, stabilized from front to back and side to side, allowing you to work smarter and in comfort, no matter the conditions.

Deutz-Fahr is working hard to establish itself in this higher-powered tractor class. The 1100 series is the biggest and most powerful tractor Deutz-Fahr has ever built. There are three different models in this series, but only the 11440 TTV fits into this large-scale class, with maximum power of 300 to 408 hp. The 11440 comes with the TTV continuously variable transmission, which offers infinitely variable speed from zero to 60 km/h. When it comes to operator comfort, Deutz-Fahr provides the latest in ergonomics and easy operations.

There’s also a new console, new air conditioning system and a multifunctional MaxCom armrest, with an integrated infotainment system.

For improved traction in the field, the 11440 is also outfitted with a new tire combination, including 2.3 metre-diameter size for the tops in traction.

www.deutz-fahr.com/en-US/

www.caseih.com/en_us

September 2014

country-guide.ca 9

reviews

The other side Competition isn’t everything, argues an American author who is a ruthless competitor in the race to get attention

By Andrew Allentuck

A Bigger Prize: How We Can Do Better Than The Competition (Doubleday Canada, 2014, 391 pp.)

$32.95.

t’s the bedrock of economics, and it’s all about how you compete in markets to sell at the best price you can get, and to buy at the lowest price you can pay.

Two centuries ago, Adam Smith proved how this kind of self-interest creates advantages for entire economies.

It’s the subject of his The Wealth of Nations, and we’ve trusted and relied on Smith’s Invisible Hand ever since.

But, did Smith get it wrong?

That’s the breathtaking assertion of Margaret Heffernan’s A Bigger Prize: How We Can Do Better Than the Competition.

On the surface, Heffernan’s book is a collection of anti-capitalist slogans from the occupy movement.

At that level, Heffernan’s rant seems outlandish, but her book has a provocative foundation.

After all, robber baron capitalism is controlled or illegal, thank heavens.

Stealing from the poor to support the rich is out of fashion. It’s not allowed, save for unprosecuted misdeeds on Wall Street. The question is therefore — what lessons can we, and especially farmers, get from a book that takes a stand against the concept of competition?

Heffernan’s pitch is that we should co-operate instead.

If that sounds simplistic, maybe you should give her a chance to make her case.

Heffernan is a columnist for the Huffington Post and she is also a relentless self-promoter, but she musters evidence to support her plea for co-operation. It isn’t all that difficult, it turns out, to cite some stunning flops as examples of worst-case outcomes of competition.

For instance, a major global management consultancy advocated forcing employees already hired and working 10 country-guide.ca

By Margaret Heffernan

within companies to compete for their jobs once a year.

As a way of injecting competition into a company, it made perfect sense.

But of the companies that implemented the idea, one-third went up in smoke, 18 per cent turned in disappointing results, and 16 per cent underperformed by some measures.

So, is the idea then that you need competition between farms, but co-operation within the farm itself?

Maybe. But haven’t generations of farmers kindled a bit of competition between their children or between employees to see who will rise to the top?

Heffernan’s argument for trashing competition is too brief and broad, but her basic idea is that co-operation is not the only opposite of competition. So is non-competition.

Let’s see what Heffernan’s core idea of co-operation offers agriculture. She mentions the cranberry business in Maine and says that they are grown only in the U.S. In fact, Canada is the world’s second-largest producer of the bitter fruit. She likes the idea that the cranberry folks in Maine support common research and marketing. What does that imply for other business?

Charges of anti-competitive marketing practices are often levelled against Canada’s marketing boards. But are those boards also co-operative in the best meaning of that phrase?

Canadian cheese producers’ business, which is ringfenced by high tariffs against foreign cheese, would shrivel if they had to compete directly against the world’s big cheese makers. Now look at the opposite case. Canada has no tariffs against foreign grapefruit because we have no citrus industry. So an orange or a lemon in Toronto

often costs less than those in Cleveland.

The free market works in the lemon biz in Canada because government price controls are absent.

On the other hand, when players in an industry collaborate to jack up or to maintain prices, to limit who can sell their goods, who can work and to set retail prices, then entities like the U.S. Federal Trade Commission and Canada’s Competition Bureau go to work. Price fixing (called Resale Price Maintenance in Canada) and refusal to deal is illegal in almost every established market except those protected by marketing boards or for products sheltered by tariffs.

A Bigger Prize is valuable for provocation. It makes you think about what should be regulated, what not.

In the end, the co-operative model works for undifferentiated products like fruit, which indeed does have a lot of grower co-operatives, and fails for branded goods like cars and other manufactured or value-added products.

It comes down to differentiation. If a grower can produce premium sausages, they have a good chance of getting more than market price for their pork.

There are many attempts in agriculture to add value in specialty grains like spelts, heritage tomatoes and apples, and even milk-based products that are not directly board regulated.

And it’s true. When I shop, I want choice and difference. That takes competition. CG September 2014

Runs on results not theory The New 9R/9RT Series Tractors are ready for anything

Power and effciency are what defne the new 9R/9RT Series. Start with a new 620-engine hp 9R model and a 10-engine horsepower increase across all models. Then add the FT4 engine technology, and regardless of which of the 16 models you choose, you have plenty of get-up-and-go with less fuid consumption. The new industry-exclusive HydraCushion Suspension, available on wheeled models, helps mitigate power hop and road lope. The 9 family also has the new CommandView™ III Cab which has more space, visibility, and convenience than our previous cab. It also features the new CommandARM™ and CommandCenter Display designed to improve effciency and give real-time insight into daily operations and machine performance.

We’re still not done. The new e18™ Transmission, increased hydraulic capacity (up to 115 gpm), and an LED lighting package add to the list of impressive features. Visit your John Deere dealer today and sit behind the wheel of the new 9R/9RT Series because Nothing Runs Like A Deere™.

JohnDeere.ca

business

new

any Canadian family farms proudly display a “century farm” plaque at their front gates, signifying at least 100 years of uninterrupted family ownership. But as impressive as that may be, 100 years hardly registers on the European scale. The Graf family of North Rhine-Westphalia, a province in northern Germany, can trace its ownership back to 1340.

Nor is that their biggest difference from just about any farm in Canada.

Behind the farm’s castle (yes, a real castle), a phalanx of 350-plus-year-old buildings encloses a square, paved courtyard. The buildings include the current manager’s residence, which once housed the many labourers required to keep a non-mechanized farm operating. “The buildings are from 1746,” says

Farm manager Maximilian von Laer (l) and assistant manager Björn Wiggen spend nearly as much time managing the farm’s heritage buildings as working on its crops.

12 country-guide.ca

In Germany, this man’s farm really is his castle, bristling with electronics and shrouded in subsidies and regulations

By Scott Garvey, CG Machinery Editor

farm manager Maximilian von Laer through a translator, as he stands near his front door.

Taking care of those old buildings is a job in itself. “One-third of my time is spent on building management,” von Laer says.

On the outside, all the buildings retain much of their original appearance and look like they could be a movie set, if it wasn’t for the modern equipment parked in front of them. Most of the structures on the farm are designated historical buildings, with strict regulations in place governing their use.

That means changes can only be made to them with prior government approval. “You have to ask them and it takes a lot of time,” von Laer explains.

But time isn’t the only cost. While about five per cent of historical building maintenance expenses are paid by the German government, when you consider the property has 12.5 acres of roofs alone (some of them thatched), the overall costs are significant.

Working within a framework of strict regulations is nothing new for von Laer — or other farmers in Germany. Signing on to accept EU government agricultural subsidies means agreeing to comply with a long list of standards for such things as chemical and fuel storage, which are subject to periodic inspections.

The Graf farm is the largest operation in North Rhine-Westphalia, with about 3,700 acres of cropland under its control. (Of that, 95 per cent of it is directly owned.) The farm also manages about 8,600 acres of woodlot.

It takes some travelling to get to all that real estate.

Fields are spread out over what used to be five separate farms, four of which have been added to the Graf holdings during the last 20 years. The farthest is 54 kilometres away from the castle. In all, there are 130 individual fields with an average size of about 30 acres each.

September 2014

Photos: Scott Garvey

The old world goes

business

Buildings in the farm’s courtyard, date back to 1746 and are designated historical structures.

The family has also invested in a 4,900-acre farm in the former East Germany, which von Laer sees as almost an exact opposite to the one under his mangement and much more like a Canadian farm. “It has a small house, big machines and big fields,” he says with a smile. It has its own manager, too, and is run independently of the Westphalia operation.

To keep his farm running smoothly, von Laer has an assistant and three full-time tractor drivers on staff. In the summer, the farm also takes on seasonal workers. That has even included hiring groups of schoolkids on their summer breaks to hand pick the small, jagged stones that litter many of the farm’s fields and cause a lot of tire damage.

The woodlots keep the farm’s regular workers busy during the winter, where trees are selectively felled and sold for timber or provided to the Graf family’s small furniture-making business, which is located only a short walk from the farm’s gate in the surrounding village of Fürstenberg.

A few decades ago, that shop would have provided all the village’s furniture, von Laer explains, and a large percentage of the people living there would have earned their living chopping wood in the forest that runs to its edge.

The farm also operates a large-scale chicken

September 2014

operation that cycles through production of 160,000 birds every 44 days. All the manure they produce is fed into an on-farm biogas production system.

Methane fuel created from processing the manure and farm-produced wood chips is used in an electrical power generation system recently installed in one of the farmyard’s historical buildings.

The wood chips come from fields planted with fast-growing tree varieties, not the higher-quality hardwood timber in the woodlots. The recently installed biogas-powered generator produces 500 kilovolts of electricity, with any excess sold to the main power grid. “We want to be energy independent,” says von Laer.

A large furnace near the generator uses the same wood chips as its fuel source for heating the chicken barns and other farm buildings. The heat created by the generator engine is also recycled to supplement the main heating system.

In the field, the farm’s six MFWD tractors ranging from 200 to 380 horsepower and its two combines are used to produce and harvest mainly winter wheat, barley, sugar beets and winter rapeseed crops, all non-GMO of course. Six hundred acres of wheat are set aside for feed in the poultry operation.

Continued on page 14

country-guide.ca 13

business

The farm’s workshop (through the open entrance) in one of the historic buildings that looks like it was originally a stable.

Contractors work on installing ducting for a new centralized heating system located inside one of the heritage buildings. It uses wood chips harvested on farm as a fuel source.

Continued from page 13 To maintain its agricultural tax rate advantages, the operation does not do custom work, unlike many other large-scale European operations. It would pay a higher tax bill if the total off-farm income exceeded 50,000 euros (C$75,000). But it does co-operate with a group of other local sugar beet growers, using its equipment to harvest the group’s combined 1,500 acres of that crop each year.

Yields for dry grain corn in that region typically run about 10 tonnes per hectare, (160 bu./ac.), 55 tonnes for silage corn (22 tonnes/ac.), 4.2 tonnes for winter rapeseed (74 bu./ac.) and 10 tonnes for wheat (150 bu./ac.).

Most of the farm’s crops are contracted directly to domestic processors. While there are brokers who purchase grain and route some of it for export, von Laer believes the farm can net better prices by dealing directly with end-users.

Just as farmers in Canada suffered through the long period of low commodity prices that ended in 2008, that period took its toll on the Graf farm as well. However, von Laer is optimistic that prices will remain profitable well into the future.“I hope so,” he says. “Ten years ago, it wasn’t good. Wheat was selling for 120 euros a tonne (C$180).”

Now his focus is on efficient management to maintain high production levels. “Today, production costs are at 150 euros (C$225) per tonne for wheat,” he adds.

Variable-rate seeding and fertilizer application are

14 country-guide.ca

a key part of that strategy. And unlike North American growers who often look for a one-pass seeding solution, seeding and fertilizing are done in separate operations. Broadcast spreaders are the method of choice for applying fertilizer. And the farm uses NDVI (normalized difference vegetative index) technology to vary application rates during multiple passes over fields throughout the growing season.

That creates more uniform stands and saves the farm about 15 euros per hectare in nitrogen costs.

Relatively intensive tillage is still the production method of choice. But the farm, like many others, has moved away from using plows. “Produktion hier ist pfluglos,” von Laer says in German. Pfluglos, roughly translated, means “without the plow.”

To help mitigate problems of soil erosion in 2001, the German government offered farmers a 100-eurosper-hectare subsidy for five years if they stopped plowing and looked to other, better tillage implements. “There is a lot of straw that has to be incorporated into the fields,” he says through the interpreter.

So tillage is viewed as a necessary process.

But the cost benefits of pfluglos have been substantial. The high fuel usage and wear and tear on equipment when plowing added up. And von Laer likes the results he’s seen since parking the plows and using newer tillage implements that leave the soil in better, more stable condition.

As we walk a few steps into a young stand of wheat, he digs up a clump of dirt with a spade and holds up a handful of well-structured, moist soil. The smile on his face says it all. CG

September 2014

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business

Wicked problem It’s the latest buzzphrase, and agriculture is in the crosshairs

By Gerald Pilger

y nature, farmers are problem solvers.

Farmers deal with production, mechanical, financial, marketing, and business challenges on a daily basis, and the success of their farm operations depends upon their ability to solve those problems quickly and efficiently.

In fact, farmers are so adept at solving their problems, the temptation is to think that every problem can be solved. Or to put it another way, there aren’t any problems that can’t be fixed.

Unfortunately, in today’s shrinking world, that attitude may actually be creating problems for farmers, and those problems may be bigger and more numerous than in past.

Here’s why.

In the early 1970s, social scientist Dr. Horst Rittel formulated the concept of “wicked problems.”

He felt some problems are impossible to solve partly (but only partly) because of incomplete or contradictory information about them, or because of changing circumstances.

Farmers have never been as dependent on other businesses, government, and society in general What’s worse, attempts to solve a wicked problem often result in the creation of other problems.

While the concept of wicked problems was developed to address social planning and policy issues, it is very applicable to agriculture policy. In an Ivey Business School agri-food blog dated April 20, 2012, Dr. Nicoleta Uzea wrote: “What struck me the most from the event (Growing Our Future: Making Sense of National Food Strategies conference) was that both the conference presenters and the attendees referred extensively to key agri-food issues such as biofuel production, sustainable farming, business risk management and underinvestment in agri-food R&D as ‘wicked problems.’”

Uzea continued: “Unlike ordinary problems,

16 country-guide.ca

wicked problems are characterized by a lack of boundaries around the problem — e.g. a wicked problem is entwined with other problems, or a solution to the problem creates a new problem somewhere else. Also, wicked problems involve complex interactions and feedbacks among social, economic, political, and biophysical elements, so that even if there are solutions to the problem, they may be virtually impossible to determine or to implement. As a result, wicked problems can never be solved (in the sense that they can be eliminated), but rather they become better or worse. In addition, wicked problems involve a lack of agreement among the people affected by the problem as to what constitutes a good or bad outcome. This may be because different people are differentially affected, or it may be that there is a lack of shared values.”

Professors Domenico Dentoni and Otto Hospes of Wageningen University, Netherlands and Brent Ross, Michigan State University collaborated on a paper entitled “Managing Wicked Problems in Agribusiness: The Role of Multi-Stakeholder Engagements in Value Creation,” and there are a number of points in their paper which farmers need to consider: “Wicked problems have cause-effect relationships that are difficult or impossible to define, cannot be framed and solved without creating controversies among stakeholders, and require collective action among societal groups with strongly held, conflicting beliefs and values.”

“They (wicked problems) result in outcomes that are either uncertain or unknowable, and often affect multiple stakeholders throughout the agri-food system and beyond.”

“Agribusiness managers do not always recognize that these are wicked problems that require not only the adoption of technological innovations but also or primarily organizational change. In particular, addressing wicked problems requires firms to engage in strategic dialogue and to take action with a diverse set of stakeholders both inside and outside the supply chain at levels that have been uncommon in the agri-food sector” Most importantly, Dentoni, Hospes and Ross wrote: “Wicked problems cannot be resolved through finding ‘right answers’ or ‘solutions’ but rather, they must be managed.”

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Wicked problems in Canadian agriculture There are other wicked problems facing Canadian farmers and agriculture in this country beyond the four that Uzea listed, and many of them have an even greater and immediate impact on individual farm operations.

Issues such as water usage, land drainage, use of antibiotics in livestock production, and rail movement of grain can pit the individual farmer’s interests against those of other farmers, non-farmers, other businesses and society in general.

No matter what policy or action is proposed to address these problems, there will be winners and losers.

Attempts to “solve” other issues including GMO and biotech, environmental degradation, biodiversity loss, and even climate change could lead to huge impacts on farmers, depending upon the strategies adopted to address these issues and whether they are or aren’t in the best interest of farmers.

Solving a wicked problem There are three textbook ways that wicked problems can be addressed: authoritatively, competitively, and collaboratively.

Most farm problems are solved authoritatively.

The farm manager decides what is to be done to solve a problem and carries out that action. However this approach rarely works well when dealing with wicked problems because it is doubtful that an individual or small group charged with addressing an issue will have considered all possible points of view of the problem.

So, although the decision-making process is simplified in an authoritative environment, when policy and decisions are left up to a single person or small group, the views of some stakeholders can be easily ignored. A perfect example of authoritative decisionmaking is how the government handled the wicked problem of the Canadian Wheat Board. Without question, there have been both winners and losers from the action the government took to end the monopoly. At the same time, other problems have been created including unhealthy basis levels, shipping problems and a declining buyer confidence.

The jury is still out on how much the ending of the monopoly has contributed to these new problems, but two things cannot be denied. First, the ending of the monopoly has created problems, not just solved them. And second, we will not have a full understanding of the scale and cost of problems for years, if ever.

September 2014

Opposing points of view Most wicked problems are characterized by two or more groups with opposing points of view. A typical approach by policy-makers to address wicked problems is to pit the opposing groups against each other.

Unfortunately, each side is typically so focused on pushing their own position that they do not try to find the best overall solution. Instead, they fight for the solution that is simply best for their position.

This seems to be the way most wicked problems in agriculture are handled. Issues such as GMO and biotechnology have been made possible by regulatory approval, but then problems that are created by those approvals such as loss of markets and contamination of conventional crops are left to the opposing sides to fight over.

Rather than managing the problem, it continues to grow as each side defends the position more rigorously and rhetorically.

Consider the Better Beef campaign of A&W. While A&W is using the public’s negative perception of hormones and additives in food to market its burgers, ranchers see this as A&W attacking the quality of commercial beef.

A collaborative approach is the most desirable way to address a wicked problem. This requires engaging all shareholders in the decision-making process, and no action is taken on an issue until there is an agreed-upon strategy by all parties.

Unfortunately, this requires participants to be open minded and to look at an issue from both sides. It requires a lot of time, and sharing of knowledge.

Besides, the agricultural industry has become so fragmented, commodity-specific farmers tend to spend more time arguing among each other rather than joining forces to address the concerns the public has about overall modern farm practices.

Most farmers think of themselves as independent businessmen and women.

Instead, farmers have never been as dependent on other businesses, government, and society in general as they are now.

As a result, the problems farmers face are bigger and tougher to solve. Any solutions are likely to impact not only other farmers, but other businesses and the public.

It is critical that farmers work together in addressing wicked problems. Most importantly, farmers need to understand these problems are unlikely to ever be solved. The best we can do is to manage them! CG

country-guide.ca 17

Incorporating sustainable intensification and climate-resilient systems into forages and grasslands

By Ron Pidskalny, Executive Director — Canadian Forage and Grassland Association

The World Congress on Conservation Agriculture held in Winnipeg in June promoted the practical application of conservation practices to improve agricultural sustainability. One Congress theme included the concept of sustainable intensification (SI). Assuming that the world population continues to grow at its current pace, it is expected to increase from 7.2 billion today to 10.9 billion by 2100. SI assumes that as the global population grows, demand for food, fuel and fibre will also grow. However, conservation agriculture may allow producers to intensify cropping systems and increase production sustainably, and without an excessive expansion in the land area required for food production through: • Improvements in soil quality • An increase in the efficient use of inputs such as labour, nutrients and water • An increase in the diversity of cropping systems

crop and livestock systems. This suggests that forage crops have a unique capacity to contribute to positive outcomes as the world moves towards SI and CRS. Currently, the onus is on the Canadian producer to increase the efficient use of inputs such as labour, nutrients and water in a profitable and sustainable manner.

One way to learn about these complex and interconnected farming practices is from a peer who has successfully mastered these systems.

The Congress also examined climateresilient systems (CRS) — well-designed conservation agriculture systems with a diversity of crop types and healthy soils.

CRS offer producers a range of choices for adapting to changes in rainfall or temperature during the growing season and contribute to climate change mitigation.

The latest of issue in L’Écho Fourrager, published by the Québec Forage Council, describes this type of peer-to-peer interaction at a recent forage tour, where a producer has implemented a dairy cow feeding strategy based on the use of high sugar content fodder. Results suggest that cutting forage in late afternoon, and leaving a 24- to 28-hour period between cutting and bailing, produces forage with higher sugar content and between 40 and 60 per cent dry matter. This concept has also attracted considerable attention throughout Canada from the beef sector, and is one of the topics identified as a priority candidate by CFGA as an Agriculture and Agri-Food Canada’s forage development and technology transfer project.

The scientific literature contains ample support for the key role of forages in improving soil quality, increasing the diversity of cropping systems and in mitigating the effects of climate change in

These are just a few examples of the resources that are, and will be, at the disposal of producers who strive to incorporate SI and CSE in their forage and grasslands operations.

CANADIAN FORAGE & GRASSLAND ASSOCIATION www.canadianfga.ca Ph: 780-430-3020

There will be further opportunities to interact with forage and grassland peers at CFGA’s Fifth Annual Canadian Forage and Grassland Conference, ‘Closing the Forage Gap’ — Addressing the Competitiveness of Forages in the Agricultural Landscape, November 17-19, 2014 in Bromont, Québec. For CFGA, this is a significant event as we bring together Canadian and international forage and grasslands stakeholders for our first ever FrenchEnglish bilingual conference featuring simultaneous translation for our speaker sessions. CFGA has lined up an impressive list of speakers including: • Dr. Gilles Bélanger, Laval University, and recipient of CFGA’s 2013 Leadership Award, who will provide an overview of major achievements in forage research and look into future challenges and opportunities for forage production • Dr. Bill Deen, associate professor, University of Guelph, who will cover the fit for forages in productive and sustainable Canadian cropping systems • Dr. Les Vough, forage crops extension specialist emeritus, University of Maryland, who will discuss the Eastern U.S. hay market’s challenges and opportunities for Canadian exporters • Mr. Alan Gardner, Haydar Group, United Kingdom who will bring us up-to-date on the Irish and Middle Eastern hay markets.

Please visit our website at www.canadianfga.ca/events/currentevents for more information.

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Looking for a safe bet Grain and oilseed prices are down across the board, but there soon could be some opportunities

By Richard Kamchen rain farmers across Canada are facing a stagflation-like, worst-of-bothworlds scenario heading into the fall of 2014 thanks to a badly timed combination of projected lower yields and weak prices.

When Canadians were hit by stagflation in the late 1970s, they got both barrels with stagnant economic growth and high inflation rates. This crop year, farmers are the ones forced to duck a two-pronged onslaught, which is coming from weather-related domestic production losses and large world supplies.

“After last year’s high prices and massive crop, we’re going to definitely see production down,” says Brian Wittal, a 30-year grain veteran and a market adviser with his company Pro Com Marketing in Alberta.

Significant Prairie area was lost this year — as much as four million acres, according to the CWB — either because it went unplanted through spring or was washed out by July flooding in southeast Saskatchewan and southwest Manitoba.

But abundant production elsewhere in the world is keeping grain and oilseed prices under pressure.

The USDA is predicting record U.S. corn and soybean production in 2014, with corn at 14 billion bushels and soybeans at 3.8 billion. It also expects a record world wheat crop of 716.1 million tons, with large foreign increases in Russia of six million tons, China, two million, and Ukraine, one million. With world wheat supplies rising faster than use, USDA pegs global ending stocks at a three-year high of nearly 193 million tons.

The Russia-Ukraine turmoil was initially bullish for markets, but expectations for a good harvest in those countries and the fact a lot of wheat is still available there heading into North American harvests bodes negatively for prices.

“Traditionally that part of the world by now has shipped itself out of wheat because they’re usually aggressive early in the fall, (but) a lot of wheat is still sitting in Ukraine and Russia because of the disruption,” says Wittal. “Buyers know all too well that there’s still wheat out there and that if they need to access it, they can.”

With the North American harvest right around the corner, buyers are going to wait and see what’s produced in terms of quality and volume before even thinking about buying more aggressively, Wittal says. “Prices are going to trend flat to lower until we see some issues 20 country-guide.ca

either with our harvest and quality, but there’s still going to be volume. There’s last year’s massive volume and you put this crop on top of it, world stocks are not getting tight or any tighter than they were before.”

Canola may have some profit potential, depending on crusher and exporter demand, and whether another transportation log-jam can be avoided this winter.

“The fact that we’ve got a large crush capacity, that’s always a supportive element,” says Chris Ferris, senior grains analyst with Canada Informa Economics, who adds export rumours suggest good foreign demand for canola seed as well. “The railroads have been moving grain fairly steadily the last little while, so the movement to export market should be broadly supportive for (canola) and the grain complex.”

A return to more normal rail service would be a boon for Wittal’s Alberta clients, among others: “If we can stay away from another logistics problem this winter, then the potential for prices to climb back up into the $10- to $11-a-bushel range is there. And at $10 to $11 a bushel when I pencil it out with any of my producers, they’re making money,” he says.

But Ferris emphasizes soybeans are overwhelming other potentially bullish factors, and if average canola yields end up reasonably good and other areas of the Prairies make up for the lost flooded acres, that’ll put further pressure on canola prices.

For Prairie farmers, lentils may offer the best hope, with values supported by flood-related production issues and strong demand.

“Since springtime, we’ve seen prices in the market go down from early forecasts, so you’ve got quite a few of the crops that have come down. The only ones that seem to be having a better gross margin look to be the lentils,” says Ferris.

Ontario Huge expected corn, soybean and wheat crops outside of Canada have also proven bearish to Ontario farmers.

Whereas Ontario grain producers might have thought they could generate healthy gross revenues earlier this spring, the reality has now shifted significantly to the downside.

Farmers are giving up serious revenue from where the highs were set in early May on corn, soybeans and wheat, says Don Kabbes, market development manager for Great Lakes Grain.

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“ We really do need a production problem somewhere in the world,” Kabbes says.“We’re not having that today — at least, we’re not perceiving that we’re having it.”

The Ukraine/Russia situation inflated wheat prices in the spring, and corn went along for the ride. Now with the news being old in the market, the focus is on supplies, and they are ample.

“Whether it’s North America or the Black Sea, wherever you’re going to go in the world to buy your wheat, you can buy wheat somewhere,” says Kabbes.

Corn’s potential is limited as well.

Not so long ago, prices were driven by ethanol demand, but from a mandate point of view, ethanol has hit the blend wall. Then in 2012, the U.S. drought September 2014

lifted values. But now, record production is forecast.

“It all feels pretty heavy on commodity prices, and there’s not much driving the demand side of things because you’ve got pretty big crops elsewhere in the world — no production problems anywhere that we’re seeing. So that doesn’t paint a bullish story at all,” says Kabbes. “We really do need a production problem somewhere in the world, and we’re just not having that today — at least, we’re not perceiving that we’re having it.”

Adding to the bearish tone are sput-

tering economies worldwide, which also dampen demand prospects, Kabbes says.

“You don’t have a robust economy that’s driving demand.”

Among the only factors that could boost prices are a smaller corn crop in the province and the possibility quality could be down. Ontario’s corn acres fell 15 per cent to 1.9 million acres, Statistics Canada reported last month, and a cool summer has slowed the crop’s development.

“And the crop is late to begin with, so the possibility of low test weight corn is very real,” says Philip Shaw, a market analyst and farmer near Dresden who grows 865 acres of corn, soybeans and wheat.

“The thing that’s helping the Ontario farmer today in corn is Ontario only planted less than two million acres of corn and we now have to import corn out of the U.S. to fill all our plants,” agrees Kabbes. “So that has increased value to the farmer today and that’s… maybe masked the severe Chicago price drop.”

Negative for both corn and soybeans could be the U.S. industry competing with other commodities like oil, coal and minerals for locomotives to move the crops to export position.

“The U.S. produces a record corn crop and a record soybean crop and has to export 15 to 25 per cent of that product out of the U.S.,” says Kabbes. “We’re going to see some depressed values from a basis perspective in the interior of the U.S.… if we can’t get rail cars to move it and barges are tied up.”

A weaker loonie, though, could provide some support for eastern growers.

“If the loonie ever decides to go down to 88 cents or 85 cents, that’ll lessen the pain, whether that’s in Ontario or Quebec,” says Shaw, who points out the Canadian dollar was the bullish story last year. “It’s what really helped in 2013. Otherwise, if you had a par dollar, where would prices be?

They’d be below futures prices and how would you like that?”

Stronger price opportunities in Ontario also come from larger premiums for non-GMO soybeans, Shaw notes.

But the big picture remains the province’s harvest prospects. “The weather’s not done with us yet, and a frost at the wrong time just wipes out this whole analysis,” Shaw says. “Any type of September frost will really change the game.” CG country-guide.ca 21

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Make the most from the 2014 market Grain markets aren’t going to bounce back any time soon, says Calgary-based market adviser Errol Anderson. But that doesn’t mean there aren’t wins to be made

By Gord Gilmour, CG Associate Editor Grain and oilseed prices are reeling from massive global crops, and the growing consensus is that we may not see a bull run in the market at any time in the new crop year. In fact, the USDA’s latest long-range forecasts have got some analysts predicting we may not see another bull for 10 years.

Country Guide associate editor Gord Gilmour sat down with market analyst and columnist Errol Anderson in Calgary to talk about the market, what it’s been doing and what you should be looking for in the future.

Anderson sees tough markets ahead. But as you’ll read, he sees opportunities too… if you know where to find them.

Country Guide: The market has changed. What can you tell us about what’s been going on and where we might be heading?

Errol Anderson: In 2012, markets responded to the U.S. drought situation by moving up, causing many to talk about a new paradigm. But in reality that new paradigm only lasted about eight months.

The following season bumper crops, especially in Western Canada, brought prices back down to earth as supply met demand. This shouldn’t have been surprising to most people — we’ve seen this pattern again and again in the agriculture industry. This latest expression of the pattern was a particularly strong one, but it was still the same pattern, so we have a fairly good idea where we are in it.

Typically markets have four distinct phases. In the first phase the market begins to heat up and climbs. In the second stage the market peaks, often in a frenzy of activity. After the market peaks, there’s a period of hope, where people are waiting for it to come back. We’re just exiting that period now and entering the period of fear and panic, where people rush to liquidate and cover long positions.

Only after this has happened will the market stabilize, lick its wounds and recover from any overshoot. And only then will prices stabilize and begin to recover. In my view, much of that process is still ahead of us.

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Overlaying these cyclical concerns are unique macroeconomic issues that I think really should be watched closely. I am not a fan of quantitive easing by central bankers. It’s money printing, pure and simple, and it was designed to stoke inflation and prevent something central bankers fear — deflation.

But there’s a lot of debate over whether that’s actually worked, or has simply kicked the can down the road.

You can see that debate in the Fed (U.S. Federal Reserve) Minutes and even in what’s been happening in the stock market the last while as it has been dropping. It may still go higher, but the fact that it’s moving up and down demonstrates there’s a debate ongoing about the true value of this market. I think there’s a very good chance that the U.S. is headed down the same road Japan has been on since the 1980s — slow or no growth and in some cases even outright deflation.

The other big issue I’m watching is the European banking situation. Again, this is a hangover from the 2008 financial crisis, and again nothing has truly been resolved. It’s been on the back burner, but it looks like it’s beginning to heat up again. If these factors deliver a macroeconomic shock, it’s difficult to see how agriculture doesn’t get swept along.

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Guide: Can you tell us a bit more about that concept of shopping your buyers?

Why is that important?

EA: Think about it from a grain buyer’s perspec-

tive who has two potential suppliers. One farm doesn’t want to tell anyone what they’ve got in their bins, because they want to keep that information to themselves, probably out of fear or of not wanting to reveal too much. Now contrast that with the operation that brings samples of everything that’s on the farm. It’s not even close. When those short-term opportunities arise, that’s the farmer who’s going to get the call first and have them offered. If they build a relationship with buyers, farmers will find that they’re better served and that opportunities appear. It sounds simple but it’s a very powerful tool.

Guide: So you’re not forecasting a quick return to higher prices?

EA:

No, I’m afraid not. I realize some farmers won’t welcome that news, but I also don’t think keeping it from ourselves is doing anyone any favours in the long run. The truth is, grain markets always spend more time in bear territory than bull territory.

On average, grain markets are in bear territory about two-thirds of the time. I don’t think anything has changed this time. Economics will always assert themselves over time, which is exactly what we’ve seen happen.

I think more than a few people in the market got carried away during the 2012 U.S. drought and really did come to believe it was different this time, that we were into a new paradigm and that soybeans really should be $17 a bushel. That led to a lot of investments and a lot of non-traditional money flowing into agriculture, which increased productivity. Again, it’s a pattern we’ve seen again and again. This was just the latest expression of it.

Now it’s not all doom and gloom. If you’re a good marketer, there will still be opportunities to lock in profitability. I think that’s a very important point. But it’s not going to be like it was in a rising market where finding those opportunities was easy — you’re really going to have to look for them, to shop your buyers, and to be ready to execute when they arise, because they won’t last long.

For example, this week, there was a 50-centa-bushel premium for No. 1 CWRS 13.5 protein, even in a falling market, because there was a buyer who needed that product and that need caused them to cry uncle and capitulate. But once that’s gone, it’s gone.

September 2014

Guide: What else can you tell us about what may happen as this plays out? It sounds like you’re expecting some pain to be felt down on the farm?

EA: Yes, unfortunately, I do expect that. What

I don’t really know — and nobody knows — is how much pain there will be. Some farms will be hurt badly. Some farms will go out of business. Some will survive and in the end do quite nicely. It’s all going to come down to management, and there are some really well-run farms out there.

In the end, I think the farmer who doesn’t understand markets — they don’t get that markets don’t care about cost of production, that markets are emotional, and that emotions are deadly in business — they’re the ones who are likely to be hurt the worst. We’re back in a time where it’s going to be very important to treat your bottom line with respect, sharpen your pencils, cut your costs — where you can — be very strategic about marketing.

We also could see some deflation in the sector.

We certainly saw inflation on the way up. Land prices could fall. I certainly expect to see cash rents come down as the new reality sets in. Equipment prices, especially for used equipment, could also fall. It could even affect the price of inputs such as fertilizer.

Then there’s also the question of some of the money that’s found its way into the sector in recent years: corporate money, investor money, offshore money — call it non-traditional sources.

I’m not sure how patient that money is, or how willing these investors are going to be to ride out a period of lower returns before they want to liquidate and find something with higher returns. Or it’s possible that some of those macroeconomic shocks could force them to liquidate. That’s an unknown.

Continued on page 24 country-guide.ca 23

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Guide: Tell us a bit about how to get emotions out of marketing. What would a well-managed marketing plan in a bear market look like?

EA: This strategy is a mix between utilizing cash

contracts and a commodity trading account. It starts with pricing a portion of your crop using a production contract — say 10 or 15 bushels an acre of canola. Going beyond that, of course, you risk incuring production penalties if there’s a shortfall.

Basis levels also need to be monitored by the grower. But should futures and local cash bids continue to rise on weather issues, it’s time to scale in put options to take advantage of these higher prices.

Often basis levels weaken during a futures market rally. In other words, the cash market doesn’t keep up to the futures. The advantage of puts in this scenario is that it doesn’t commit the grower to produce and deliver the grain to a buyer and there is no margin call risk. This helps keeps grower emotions in check.

It’s important for the grower to realize that the best-case scenario is when these put options expire worthless. This means the local cash price held up.

But markets seldom work that way. Rallies are often short lived, but offer excellent pricing opportunities.

Bear markets characteristically don’t allow the bull to run very long before selling pressure reappears.

I believe we are in that type of market right now.

“ If you’re disciplined and keep your emotions in check, over time you will come out ahead.”

Guide: In your opinion, what’s the best general tool for hedging at the farm level?

EA: I’m not a huge fan of using futures outright, because it takes a strong person to take a margin call. I am a big fan of using options — calls and puts.

It’s not as strong a tool as, say, straight shorting the futures market, but it keeps you disciplined and keeps your emotion in check. The people who did well using futures recently — and I had several clients who did — were extremely disciplined and they had the guts to take margin calls, stick by their position, and even add some more positions while they were at it.

It got kind of ugly, but in the end, now that it’s turned, we’re sending cheques home, and I love it. But that’s not for everyone. Everyone’s appetite for risk and their ability to weather those sorts of things is different, and we as market advisers need to respect that.

When we start working with a new client, we’re 24 country-guide.ca

constantly trying to gauge their ability to weather risk and we make recommendations accordingly. For a lot of people, a put in a rising market, which gives you the option to sell at a price but doesn’t have a delivery attached to it, is a good tool. It’s more like an insurance premium, and it helps you remove a lot of the emotion from the decision and gives you the chance to lock in profitability now, but still gives you the opportunity to participate in the upside of the market.

Guide: Do farmers use these sorts of tools enough? Or are they still too hung up on holding the actual grain, rather than moving the grain and buying the paper?

EA: I think they have been, but that might be

changing. I’ve been in this business a long time, many years now, and last fall, for the first time, I had a number of clients say to me “Why don’t we sell the grain, instead of storing it, and just buy the paper instead?” That was revolutionary.

Unlike other market advisers, I don’t favour storing grain, which I know is not a particularly popular opinion. But to me, stored grain is nothing but a liability.

There’s just so much that can go wrong. If you move that grain and buy the paper, you’re protected. You’ve got the money in your hand, but you’ve still got the chance to participate in any increase in markets.

Now, it’s still important to be patient when you do this, even with options. It can feel like you’re throwing good money after bad sometimes. But if you’re disciplined and keep your emotions in check, over time you will come out ahead.

Guide: At the risk of floating you a softball question and letting you talk yourself up, why should farmers use the services of someone like yourself, and especially during a time like this in markets?

EA: (chuckles) Well, it doesn’t actually have to be us, there are a number of really good market advisers and commodity brokers out there. But I do think it’s important to have someone like us in your corner, especially during these most challenging times. There are a lot of younger farmers out there now who probably haven’t seen this kind of market. I think they’d benefit from having someone with a bit more experience who’s seen a bit more of what can happen in markets. For example, I remember on 9/11, when the second tower went down and all our screens went blank. That’s an extremely dramatic example, but you get the idea.

And for everyone, regardless of their personal experience level, I think there’s a lot of value to be found in having someone working on marketing that’s like us — less emotionally involved, a paper pusher, almost. I’ll say it outright just to emphasize it: emotions are deadly in business. CG September 2014

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September 2014

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Charting a profit Theory is great for textbooks. In real life, farmers like Stan Jeeves, need practical marketing programs, which they’re building for themselves

By Lisa Guenther, CG Field Editor

tan Jeeves runs a mixed farm near Wolseley, a southeastern Saskatchewan community once named one of Canada’s prettiest towns by Harrowsmith Country Life Magazine.

Jeeves takes a common-sense approach to selling grain. “I start with calculating my cost of production,” Jeeves says. “And then I know when I need cash flow.”

From there, Jeeves looks for delivery contracts that are above his cost of production and within the time frame when he wants the cash.

It all sounds simple and natural, and a sure way for anyone to win in the markets every year. But that can be deceiving, as you learn the further you delve into Jeeves’ marketing systems and his belief in the critical importance of charts.

Farther east, Dale Gryba also focuses on a similarly practical approach. It isn’t that Gryba doesn’t know the more sophisticated lingo of marketing textbooks and the MBA schools. But, says Gryba, he doesn’t actually market his crop. He sells it.

“We are simply sellers above the cost of production,” says the Manitoba farmer.

“Marketing,” he says, is done on behalf of farmers by organizations such as the Canadian International Grains Institute that differentiates the Canadian crop for world buyers.

Farmers are selling a commodity, Gryba says. They have few means of differentiating their crop from that in the bin down the road.

But that doesn’t mean Gryba thinks he always has to be a price-taker. In fact, avoiding market troughs comes down to taking charge — with a plan.

September 2014

Know, and control, the critical numbers Cost of production also underpins Gryba’s plan, helping him to sell at a price that covers costs and still gives him “a little bit of spare beer money.”

When it comes to managing costs, Gryba takes his cue from Ford Motor Company. “It knows its cost of production. And it knows what it can sell that car for. So it just makes it cheaper.”

Gryba pre-prices inputs, buying fertilizer in the fall, but acknowledges that takes cash. When cash flows have slowed to a trickle, cutting seeding costs is another option, Gryba says. “If you haven’t got much cash then you seed oats or the grasses… And hope for a Hail Mary.”

Gryba farms near Gilbert Plains, in the parkland of southwestern Manitoba, just a stone’s throw from the rail line. Loading producer cars also lowers Gryba’s costs. “We can get a dollar and a half more by putting wheat in a rail car versus going to the elevator for ourselves,” he says.

That discipline extends beyond controlling costs and knowing the numbers. Both Jeeves and Gryba put that self-control into action when selling by using commodity pricing charts.

Gryba took courses over 20 years ago, in the days when they had to handwrite their charts, and says knowing how to use the charts is magical. They take the guesswork out of unpredictable world events such as war or floods or droughts, he says.

Continued on page 28

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business Continued from page 27 “You can draw a line on a chart and watch it hit it,” says Gryba.

Jeeves and Gryba both say commodity charts take the emotion out of selling.

“People like to think this is all new — the commodity funds influencing the market and one thing and another — but the market has traded on weather and emotion forever and it always will as far as I can see,” says Jeeves. “So that’s where the charts come in.”

Jeeves also looks at commodity price charts and daily newsletters to figure out whether the price will climb or fall.

He says the money tends to enter and leave the market at the same point. “So if you’ve seen the recent highs have been $450 in canola in the last three months, then next time it’s at $450 it’s probably a good idea to sell some,” he says.

Farmers need to avoid both fearbased selling and the temptation to try to catch the top of the wave. Holding out for the high point is essentially betting against industry, says Gryba, which is a losing strategy in the long run.

“If you did beat Cargill once or twice, it’s like Vegas,” says Gryba.

Gryba says farmers don’t have to have their entire crop priced out September 1, but they should have a large portion figured out at a price that will make them happy.

For example, if a farmer wants $10 for canola, “when canola hits $10, then you sell some at $10. You don’t wait until November when you and 40,000 other guys need money. Everybody knows (about) November 1 payments,” Gryba says.

“You’ve got 24 or 30 months to sell a crop,” says Gryba, who adds “there’s an old saying too that usually you have at least two opportunities to make a profit, even in a poor year.”

Dealing with the transportation snarl-up Gryba compares the transportation issue to the dispute between hockey players and team owners.

And farmers aren’t the billionaires in this scenario, Gryba adds. “All I want to do is play hockey. Just let me over the bench, coach,” he says.

But it was pretty hard to play hockey this year. Producer cars ordered in January didn’t arrive in the Gilbert Plains

“The market has traded on weather and emotion forever,” Jeeves says.

“That’s where the charts come in.”

28 country-guide.ca

area until August 5, Gryba says. March cars weren’t expected until the end of August or September. Farmers can’t deliver on a contract if the train doesn’t come, Gryba says.

Jeeves says the inability to move grain when needed forced farmers to give up the carry in the market.

“That’s been unfortunate and has cost producers money,” says Jeeves.

For his part, Jeeves wasn’t always able to sell crops when he needed cash flow this year.

“Fortunately, by having cattle that were very marketable, we were able to move our cattle marketing up some to cover off the lack of cash flow from grain,” he says.

Gryba also had an ace or two up his sleeve. He contracts high erucic acid canola with Bunge, which gives him peace of mind, he says.

“They give you a price in advance, a year ahead. And they take all you can grow,” says Gryba, adding the canola is delivered to a crushing plant in Nipawin, Sask. Bunge generally takes portions of the crops throughout the year, and offers a cash advance program, Gryba says. The contract also includes an Act of God clause.

Gryba would like to see the industry offer more Act of God clauses in delivery contracts. He points out big farms with, for example, 10,000 acres can risk pre-selling more of their contract without such clauses because they know they’ll likely get an average yield over their entire farm. But farmers with less dirt are reluctant to sign such contracts because of hail and other weather risks.

Although big farms might have an advantage when it comes to spreading risk on pre-pricing contracts, bigger isn’t automatically better, says Gryba. It still comes down to management and having a plan, he says.

“Forget about selling everything at the highest — it isn’t going to happen.

It’s not getting caught in the bottom third all the time,” says Gryba. “If you have a plan, you won’t be in that bottom third.”

Jeeves jokes that staying in business is perhaps a measure of success. “Selfevaluation is always a tough criteria to meet,” he says.

Ultimately meeting targets, and avoiding scrambling and illogical decisions “because you’re in a corner because of financial pressures” are signs of a solid marketing plan, says Jeeves. CG September 2014

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AS YIELD

business

When good deeds are

good business More than a trend, projects where farm organizations work with charities to feed hungry people are becoming essential business practice. Here’s why

By Lois Harris

Beef producer Bob Gordanier (l) presents $40,000 cheque to the food bank's Bill Laidlaw.

hen Bill Laidlaw was general manager of the Chicken Farmers of Ontario, he had no more insight than anyone else into what food banks were, what they did, or how they operated.

Now, as executive director of the Ontario Association of Food Banks (OAFB), he spends a lot of his time lobbying the government, companies and organizations to help keep his charity running, providing food to nearly 400,000 hungry people, many of them women, children and seniors.

Laidlaw has been encouraged recently with commodity groups that have revitalized old donation

30 country-guide.ca

programs or started new ones. They’re catching on all across the country, and the Ontario example shows how and why.

“Farm organizations recognize it’s the right thing to do,” Laidlaw says. “It’s good public relations, it shows they are good community citizens, and I think they realize that many people who use food banks come from rural areas.”

Having enjoyed a good relationship with the Dairy Farmers of Ontario for years, the OAFB recently reached new agreements with Ontario Pork, the Egg Farmers of Ontario, and the Beef Farmers of Ontario. Each organization approaches its contributions differently, but the results are clear. A lot of

September 2014

business hungry people who need it are getting good wholesome protein in their diets.

Other commodity groups are engaged in other partnerships to achieve similar ends. The Ontario Fruit and Vegetable Growers’ Association, for instance, is working directly with the province to send wholesome snacks to school kids in the north.

Meanwhile, Ontario Pork wanted to revitalize the Donate-a-Hog program started in 1998 by longtime agricultural advocate and producer Paul Mistele.

Former board director Mary Ann Hendrikx and her husband Lyle, along with staff from the organization and the animal health company Elanco redesigned the program so it would reach more people. With the board’s approval, the program was piloted in the summer of 2013.

Under the new program, Ontario Pork, representing 1,600 producers, encourages processors to match, dollar for dollar, its $10,000 annual contribution. It provides funding to processors who then ship one-pound packages of ground pork to food bank distribution centres. Zoetis, Shur Gain, Elanco and Bob and Wendy Fraser added their contributions for last year’s successful pilot, which saw 10,000 pounds of ground pork distributed out of centres in Windsor, Sarnia, Chatham, London, Stratford, Guelph, Hamilton and Owen Sound.

The main reason Ontario Pork revived the program was to give back to the community. “As farmers, we all live in rural communities, and are supportive of them,” says board chair Amy Cronin, who farms at Bluevale, Ont. “We want to help people faced with difficult situations, because we can also relate.”

Another reason is to get more people eating pork. The distributed packages come with tips on how to safely cook the meat, plus recipes that are both easy and tasty.

“With this program we are able to expose people to a product that they may not have previously tried, so we want them to have a good experience with it,” Cronin says.

This year, the campaign got underway at the end of July, and was expected to put 10,000 pounds of ground pork into dozens of central Ontario food banks.

In March, the Egg Farmers of Ontario (EFO), representing 460 producers, committed to donating at least $250,000 worth of product this year to the province’s food banks.

“We got involved because it’s a way of showing our social responsibility,” says Scott Graham, chair of the Egg Farmers of Ontario. “It’s the right thing to do.”

Continued on page 32

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www.canadianfga.ca September 2014

country-guide.ca 31

business Continued from page 31 Individual egg farmers had been donating to food banks for a long time, but the board decided to take a province-wide approach as part of its 50th anniversary celebrations. A presentation by Bill Laidlaw to the board a couple of years ago in which he described the need started the ball rolling.

Under this program, egg farmers and others are encouraged to donate at least $50 to the EFO. The sum is the cash equivalent of one hen’s production for one year, or 25 dozen eggs. The organization then provides $20,000 a month to the food bank association and arranges for extra birds to be placed in either the donor’s barns or those of another producer who is willing and has extra space.

The OAFB then buys the eggs from suppliers Gray Ridge and Burnbrae, who donate the grading and processing costs.

School kids in isolated northern Ontario communities get fresh fruits and vegetables, thanks to a partnership between growers and the province.

Graham has taken the commitment to heart by personally contributing $5,000 — the equivalent of 100 hens’ production. While total donations so far are about $30,000 with 30 producers having contributed, he is confident that more will get on board as they replace their birds, which they do once a year.

Meanwhile, in June the Beef Farmers of Ontario (BFO) announced a $40,000 commitment to a new partnership with the food banks association.

“The reason we got involved is that I think it’s hard to believe that more than 375,000 Ontario people including 131,000 children access food banks every month,” says chair Bob Gordanier. “We learned that from a presentation by the food banks people last year, and also learned that protein is by far the most needed item.”

32 country-guide.ca

“They asked if we could help,” Gordanier says.

“We said we could.”

The BFO provides the funding to the OAFB, which then buys the ground beef and distributes it where it is needed the most. This year’s contribution will buy 28,000 servings for hungry people.

Gordanier says that many individual beef farmers and county associations have been donating for years, but this is the first time the provincial organization has contributed on behalf of its 19,000 membership.

“Our producers are proud of having the name Beef Farmers of Ontario attached to something as important as this,” Gordanier says.

Earlier this year, the Ontario Fruit and Vegetable Growers’ Association (OFVGA), with 28 member organizations representing more than 7,500 fruit and vegetable farmers, expanded an eight-year program that provides fresh snacks to schoolchildren in northern Ontario.

The Ministry of Health is providing the OFVGA with about $1.1 million each year for the next three to give 38,000 kids in 191 schools fruit and vegetable snacks twice a week. The program runs for 20 weeks starting in January.

All the logistical and procurement work is done centrally through OFVGA program co-ordinator Alison Robertson. She says that the program started nine years ago when her organization was approached by the ministry to help deal with obesity and other health problems that were showing up in school-aged kids in the north.

“At the time, some people thought it wouldn’t work — that the kids would just throw the snacks in the garbage,” Robertson says. “There was some waste in the first month, but after that it went to zero, and eventually teachers started to report that they were seeing fresh fruits and veggies showing up in the kids’ lunch boxes.”

In the fall, Robertson starts lining up suppliers and transportation and is ready to roll in January.

Each of 11 to 14 growers provides product two or three times through the next five months, and each receives fair market prices for their efforts.

“We realized that it wouldn’t last very long if we kept asking people to just give their products away,” Robertson says.

As a result of the volumes, Robertson pays wholesale prices, and has refined her distribution system over the years so that it now works very smoothly and she can keep a close eye on both the budget and food safety, including product handling and traceability.

With the program’s expansion this year, a deal with the North West Company retailer sees the snacks hitch a ride on the company’s supply planes to communities like Peawanuk and Attiwapiskat.

The goal of the program is not only to bolster the children’s health, but to also encourage youngsters to develop a lifelong habit of eating fresh produce.

The association knows too that it also provides the OFVGA with leverage when the organization lobbies the government on behalf of its grower members. CG September 2014

business

The consumer connection Meeting Lynn Ogryzlo in the heart of Toronto’s food district, we wonder if maybe the chasm between farmers and consumers isn’t as deep as we thought

By Steven Biggs, CG Conributing Editor

In Ontario alone, Ogryzlo’s $10 challenge would pump $2.4 billion more to food producers.

ag-toting shoppers amble past me on either side as I snag a table near the bakery. It’s already 2 p.m., and the pickedthrough bakery racks confirm that it’s too late to get the best-of-the-best fresh food at Toronto’s St. Lawrence Market.

Even so, the place is still a hive of food lovers.

That’s because by midday, the shoppers change. The hard-core grocery browsers give way to a hard-core, hungry lunchtime crowd.

Either way, they love their food. They also know a lot about it, and it looks like they want to know more, although I wouldn’t take any bets on how much they know about Canada’s farms.

Along with the lunchtime crowd and grocery shoppers, though, some people just come to hang

out and chat — people like food writer Lynn Ogryzlo and me. As coffee spots go, the floor-mounted melamine table with attached plastic chairs we sit at isn’t pretentious — and neither is Ogryzlo. I’ve barely shaken her hand before she apologizes about the garlic smell from the pastry she’s brought to munch on during our meeting.

I’ve been hoping to meet Ogryzlo because she’s a food columnist who talks a lot about what many food writers don’t: farmers.

In her 2011 bestselling book, T he O ntario Table, Ogryzlo serves up recipes for Ontario-grown food, pairing each recipe with a blurb about a farmer. There are grower stories, recipes, and culinary destinations. A column on farmer Fred de Martines and his Tamworth pigs accompanies the recipe for pork patties with nectarine relish, while the page on simmering beef features the O’Brien Farms Simmental herd at Winchester, near Ottawa.

It’s more than just a cookbook, and Ogryzlo takes a hard-to-define, sometimes disparaged concept — local food — and boils it down into a clear, compelling message called the $10 Challenge. It’s nice marketing: $10 each and a billion-dollar impact.

She explains in the book, “If every household in Ontario spent just $10 of their grocery budget on local foods each week, there would be a $2.4-billion influx into the provincial economy each year!”

In a world where farmers complain they’re misunderstood and ignored by consumers, Ogryzlo might be our best indication of what happens when a person of good intentions, open mind, and an intelligent curiosity begins to look closely at their food.

The culinary activist A self-described “culinary activist,” with a focus on locally grown food, Ogryzlo is quick to make the distinction between activism and extremism. She recounts travelling to Chicago and making a social media post about Chicago food. She was shocked to get an indignant response from a follower who was upset that the post hadn’t been about Ontario food.

She shakes her head, saying, “It’s not absolute.”

Another time, she met someone who hadn’t eaten a mushroom for a year because he couldn’t find Continued on page 34 September 2014

country-guide.ca 33

BUSINESS Continued from page 33 locally grown ones. “It doesn’t matter,” she exclaims, adding, “It’s not a diet, like the Atkins diet or Weight Watchers diet! That’s not the point.”

The important point, she feels, is that shopping with local food in mind has the power to make farming sustainable for farmers. It requires neither absolutes nor a black and white, 100-mile-diet dogma.

(Although she does like the book THE 100-MILE DIET because it gets readers thinking about the food system.)

Food and community Ogryzlo grew up in the community of Thorold in the Niagara region of Ontario. The granddaughter of Italian immigrants, she describes it as a community with a heavy Italian presence where people hung out on front porches to chat. She remembers the farm truck picking up local women to work on nearby farms, and, at the end of the day, the women being driven home, legs hanging over the tailgate, balancing bushel baskets of seconds for their own use between them.

“The people who worked on farms were the people who lived in our neighbourhood,” she recalls. It was a community where food played a pivotal role.

If there was extra produce in those bushel baskets, it was shared, with a jar of some sort of preserve given in return at a later time. Food was used to celebrate, to mourn, and to nurture the sick. “It made us a really strong community,” she says.

It’s still that power to foster community that she sees in food — and in people’s shopping habits — today.

Her own community — the Niagara region — used to include 20 canning factories, she says. But now there are none. Today, she sees more tourism.

That’s fine, but she feels there is an opportunity to attract tourists for agriculture too. That was the idea when she helped found the Niagara culinary trail, a culinary tourism organization connecting consumers to farmers.

THE ONTARIO TABLE THE ONTARIO TABLE (www.ontariotable. com) is Ogryzlo’s third book, following in the footsteps of NIAGARA COOKS, FROM FARM TO TABLE and N IAGARA C OOKS , A SEASONAL APPROACH. For this book, she explored beyond her home base of the Niagara region, taking weekend trips over two years to different parts of the province to meet farmers and taste food.

Her regionally focused books and local food have some parallels: both are on the fringes of conventional marketing and distribution channels.

“In the publishing world, everyone thought I was nuts!” she tells me with a laugh.

In the book, Ogryzlo tells readers not to worry about following recipes to the letter. She hasn’t followed the standard publishing recipe to the letter 34 country-guide.ca

either, opting instead to self-publish her books. It has worked out well, as all three have been bestsellers, and she has won a number of international awards.

Without the distribution infrastructure that a publisher would have, she built her own network, selling books through on-farm stores, including many of the farms featured in the book. “It’s the largest margin item in their store,” she says. Eventually, the distribution channels came to her because of consumer demand for her books.

$10 challenge magazine While THE ONTARIO TABLE includes a section that lists suppliers of things as diverse as soy sauce, salt, flour, nuts, and cornmeal, Ogryzlo found that people still had difficulty with the shopping side of eating locally. In response, she did more travelling and then put out an electronic magazine (now combined into an e-book) called THE ONTARIO TABLE $10 CHALLENGE, A YEAR OF EATING LOCAL, in which she worked with 25 agricultural commodity groups to get facts for consumers about Ontario food.

Markets and farm gate stores are great, she says, but they aren’t the only way to support local farmers. When it comes to shopping for local food, Ogryzlo tells me, “The grocery store is a good place to find local food.” She laughs as she describes trips to her local grocery store and people peering into her cart to see what is in there. While some people connect the idea of local only with fresh produce and meat, Ogryzlo includes all foods raised and produced in Ontario. That can include common things such as meat, tinned goods and dried beans.

Industry playing catch-up Ogryzlo feels that consumer confusion about the definition of local food is a result of the movement being a consumer-driven — not industry — trend.

“The local food movement sweeping the country is led by consumers and I think this is the very reason we face challenges such as lack of distribution and an agreed-upon definition of local food,” she says. It’s a case of industry catching up to consumer demand.

In the meantime, Ogryzlo is gearing up for a new audience. She and her husband have just moved from the Niagara area to Toronto — and she’s looking forward to writing for a new slate of publications. She says she has always wanted to live in a big city. “Toronto was more doable than Paris,” she says with a chuckle.

She’s not at all worried about missing out on farm-fresh produce in the city. “In the city, people are more fortunate,” she says as she talks about urban markets often attracting more farm vendors than smaller centres.

When it came to picking a neighbourhood in Toronto, food was important — so she’s not far from the St. Lawrence Market. As we finish chatting, we leave the table in the bakery aisle. We head our separate ways, each of us to shop.

I keep my eyes on all the consumers in this one market, and I have $10 in mind. CG SEPTEMBER 2014

hr

Make a better impression If you think it doesn’t matter what impression you make, you could hardly be more wrong

By Pierrette Desrosiers, psychologist and coach

want to talk about marketing… yourself. Usually, marketing is associated with products or services. But what about self-marketing? For decades, experts have studied how to use marketing to attract customers. They know that they can sell you a product if they are able to make you feel good about yourself, or if you think that the product will prevent you from feeling bad.

Emotional Marketing, as it is called, is messaging that builds your ego. It can make you feel smarter, bolder, more sophisticated, or just about any other emotion fundamental to your self-esteem. By making you feel better about yourself, the brand being marketed is no longer just a product; it becomes a friend and part of your identity. “I drive a BMW” can lead to “I am a successful person.” You feel that these brands share your values and priorities.

But how do you market yourself?

Let’s start by recognizing that you are already doing it. Like it or not, we leave our mark. Our mere presence affects others; we leave an “emotional imprint.”

How do people feel when they are in your pres-

People will forget what you said, people will forget what you did, but people will never forget how you made them feel — Maya Angelou ence, and afterwards? Is their ego nourished? Do they feel important, respected and understood? Do they feel that you really care about them?

The way you interact, the words that you use or don’t use, and your non-verbal communication all contribute to your emotional imprint. Emotional imprints can be so strong that just thinking about someone has the power to make us feel good, comforted and happy. Or, alternatively, it can leave us feeling upset, disgusted, afraid, or uncomfortable.

This imprint is built into your limbic system and stays there forever — the stronger the emotions, the stronger the imprint. The human being is above all September 2014

an emotional being. The latest research in neuroscience shows that decisions are usually made through our emotional brain before our rational brain, even if we are totally unaware of it most of the time. We feel first, and then we analyze.

Yet when I interview the staff and family members on farms, many tell me that they work harder, more efficiently, and with a more positive attitude when the boss is on vacation.

As a leader, your staff and suppliers will try to give their best only if you make them feel good about themselves. Think about your own experience. How do you react when others leave a negative emotional imprint on you?

So, in the future, when you interact, be aware of yourself and take the time to ask a few questions: What impact do I make on others?

Would I choose myself as a boss, partner, spouse, or parent?

Do I interact with others, in tone and behaviour, the way I would like them to interact with me?

How do others tend to react in my presence?

What would I like other people to say or think about me?

Are my actions in line with my expectations, values, and goals?

What is the emotional impression that I wish to leave?

What would I like to be remembered for?

As emotional beings, we have far more impact on one another than we often realize. Years later, someone may not remember what you said or did, but they will remember the emotional impact you left.

As a farmer, you leave a footprint that you should care about. But as a human being, you leave an even greater impact.

So as you make your mark, why not try to make it a positive one?

In your everyday life, be conscious. As a leader, boss, parent, or spouse, you can make the difference.

Since you market yourself anyway, why not do so in a kind and inspiring way? CG Pierrette Desrosiers 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) Email: pierrette@pierrettedesrosiers.com. country-guide.ca 35

Succession In agricultuRe

Succession shock So, you think farmers are on top of Canada’s succession challenge?

By Amy Petherick uccession planning has become a pretty sexy topic in agriculture. Every hip and trendy professional office for farmers is mailing out their own shiny leaflet to everyone they know about it, and no selfrespecting event planner would even think of hosting an agricultural conference without at least one workshop on transferring the farm to the next generation.

But hold the champagne, because farmers still aren’t buying it.

The workshops may be full, but the work itself isn’t moving off the “someday” list.

Debra Hauer of the Canadian Agricultural Human Resources Council helped create a Human Resources Tool Kit just last year which included, of course, a succession module. “Succession planning has been a hot topic for a while across the country, and there are a number of good resources,” Hauer says, and she begins to tick off the fact sheets contributed by various provincial governments and producer associations.

Most of those fact sheets and resources focus on the traditional understanding of succession planning, i.e. the intergenerational transfer of a business. But Hauer’s kit also addresses the less familiar definition of succession planning, where an employer creates a plan to ensure there will be replacements ready to step in for all key positions.

“Succession planning is a part of the general HR function… to make sure that the people are in place to ensure success,” Hauer explains.

Hauer tells me the kit has been well received, especially by farmers whose businesses are really growing, so they will have the right managers and the right skill sets in place as their business continues to get larger and more complex.

In fact, a number of organizations have bulk purchased the tool kit too, and one university has even deemed it a required text for students. “In the summer and fall last year, I contacted people who had purchased the tool kit and the feedback was excellent,” Hauer says.

But when I ask her what farmers specifically said about the succession section of the kit, she pauses and then responds, “Quite honestly, there have been no comments about the succession section.”

It isn’t an isolated case. When you look beyond

36 country-guide.ca

the workshop attendance numbers and the book sales figures, and when you try to find actual evidence that farmers are implementing enough succession plans to match the scale of impending succession squeeze, the numbers just don’t add up.

When it comes to planning for the future of the farm, it seems, the agricultural industry could use a little less talk and a lot more action.

This isn’t unique to the farm community. A Canadian Federation of Independent Business (CFIB) study conducted in 2012 found that over half of all small and medium enterprise owners in Canada had no plan at all for what will happen to their business when they’re done with it. Only nine per cent of businesses had a formal succession plan.

To get a sense of how farmers compare, just one year earlier, Ipsos Forward Research found 19 per cent of a sample of farmers from Ontario did have formal succession plans.

Daphne McGuffin, who creates succession programs for both farm and non-farm families at BDO SuccessCare, agrees that farmers are usually better at initiating succession than the average business owner.

“Farm families, generally speaking, do a better job because it’s their legacy,” McGuffin says. When she recalls all the studies she’s been reading in recent years, she says the basic summary is that 80 per cent of all business owners would like to see their business stay in the family but 50 per cent don’t expect that to actually happen. “The sad thing about that,” she says, “is they’re making the decision without really trying.”

McGuffin remembers that when she was first getting started in the succession business, back in 1996, there was little awareness at any level about succession planning, and she believes business owners had reasonable excuses for poor planning then.

A 1999 report by Deloitte & Touche after all was the very first to offer insights into small business succession in Canada. Their questionnaire revealed that 43 per cent of Canadian business owners didn’t even believe it was important to keep a business in the family. As well, 70 per cent had not yet selected a successor and 66 per cent of respondents had no process for selecting one, although 56 per cent planned to retire within 10 years and another 22 per cent within 15 years.

September 2014

business

Farmers might therefore be doing better than some other sectors. But are they still doing too little?

A team of English and American researchers published data in the August 2010 Journal of Agriculture, Food Systems, and Community Development comparing farmers’ relative expertise in succession planning globally, and its 1997 survey of Ontario and Quebec indicated that roughly 40 per cent of farmers had already identified a successor at that time.

Yes, that’s right, about 40 per cent had identified a successor already in 1997 and 15 years later, just 19 per cent of farmers had written a succession plan.

McGuffin says two CFIB surveys, administered first in 2005 and then repeated in 2012, establish even more disturbing trends.

“Back in 2005, 60 per cent of business owners said ‘it’s too early’ to start their succession plan,” she tells me. “In 2012, the response only went down to 52 per cent.”

McGuffin continues on to the next excuse, i.e. “no time to deal with the issue.” Back in 2005, 28 per cent gave that as an answer. In 2012, it was 29 per cent.

As an excuse, “Can’t find adequate advice and tools to start,” becomes even more suspicious since 17 per cent listed it in 2005, growing to 21 per cent in 2012 despite all the work that governments, farm organizations and advisory firms have put into the issue.

Other responses which increased included “the process was too complex,” plus the number of farmers who simply didn’t want to think about leaving (up from eight per cent to 13 per cent).

With numbers like that, McGuffin believes there is a real problem in the succession-planning field.

The fault doesn’t only belong to farmers. “I don’t think advisers are addressing three fears that business owners have,” McGuffin says. “One is the fear of loss of wealth, the second is a loss of control or identity, and the third is fear of conflict.”

Recently, loss of wealth has been more of a concern for other businesses impacted by the economic downturn, but farmers are hardly immune to exterior factors. The fact that a third of business owners with succession plans had to revise their existing succession plans, delaying or accelerating their exit date according to CFIB, supports McGuffin’s point that succession planners need to do a better job of incorporating contingency strategies for market fluctuations.

Meanwhile, the No. 1 reason for lack of farm progress is farmers’ fear of losing their identity.

Yet experience shows that such fears can be swiftly mitigated by post-transition-planning exercises that identify exciting opportunities for the exiting generation, McGuffin says.

Fear of conflict is more stubborn, yet it can be managed too. “Choosing a successor means you’re saying no to somebody else,” McGuffin agrees.

“When it’s your kid, that’s pretty hard to do.”

In order to help farmers overcome these hurdles,

September 2014

McGuffin says BDO SuccessCare teamed up with the Agricultural Management Institute (AMI) to produce interactive resources that will be harder for farmers to leave unopened on a shelf. One of their most comprehensive resources, the Choose your own Succession online tutorial, is best described by Ryan Koeslag, AMI’s executive director, as a quick and dirty succession tool.

“Really what we’re trying to encourage is taking it to your adviser,” says Koeslag, “but we were worried there are a number of accountants or succession-planning consultants that know one process and one process only.”

Koeslag says they don’t want to encourage farmers to eliminate professionals from their succession planning efforts because AMI baseline research has found that farmers get greater satisfaction from outside succession training than from any other strategy.

We hunted for evidence Canada has enough succession plans.

The numbers just don’t add up While there is no clear confirmation that farmers are following through with their advisers, the interactive nature of the resource does provide immediate feedback on user behaviour.

“We know it’s had a lot of really good hits,” Koeslag tells me. “Even prior to launching the program, promotions within BDO and just word of mouth generated over 400 hits, which was phenomenal.”

As a farmer involved in two operations himself, Koeslag knows first hand how difficult it can be to get that plan written on paper. But AMI’s research also shows that, of farmers retiring in the next five to 10 years, 67 per cent believe succession planning is a valuable practice.

Exactly how valuable was established by Pricewaterhouse Coopers last year. Companies that transition without a succession plan experience a 29 to 32 per cent drop in business in the first three years post-transfer.

In other words, if all the farmers who say they want to develop a succession plan actually got around to getting the job done, the income hit on agriculture would likely be slashed by billions.

Koeslag isn’t holding his breath.

“For the most part, succession planning is the most supplied resource, but a fairly small percentage of the industry — too small from our perspective — seriously engage themselves in it in a constructive way,” Koeslag says. “We want that succession conversation to start from Day 1.” CG

country-guide.ca 37

Succession In agricultuRe

Getting there from here The buzz these days says that succession is a journey, not an event. But who has the map?

By Andrea Hilderman n entire industry has built up to support farm succession planning. And for good reason. With a typical farm in Canada worth millions of dollars and requiring numerous staff, and with so many farms having related businesses and supporting two or more families, transition of the business to the next generation involves a lot more than a handshake and a slap on the back.

Just don’t look for a lot of statistics or hard numbers about how many farms are going through succession, or how many billions of dollars’ worth of assets they’re discussing.

This may be the biggest phenomenon that Canadian agriculture has ever witnessed, but neither the federal government nor the ag universities nor anyone else really has a good handle on just how big it is. And no one really has a good handle on how well farmers are doing at meeting the challenge.

Anecdotal evidence, of course, is as common as mailboxes all across rural Canada.

“Statistics Canada does have some good data on farm operators,” says James Bryan, senior agricultural economist with Farm Credit Canada in Regina.

“As does the Canadian Federation of Agriculture.”

There are estimated to be over 140,000 farm operators over the age of 55 still actively farming in some way on something in the neighbourhood of 17,500 farms.

It’s thought they control something in excess of $50 billion in farm assets, much of which will change hands over the next 10 years.

It’s also recognized that the ability of the successor to service the debt required to buy the farm is a real issue, and that increasingly, it is an issue that can take many decades to resolve, with serious implications for both the retiring and the successor generation.

Just to state the obvious, servicing a large debt can restrict the new farmer’s ability to make the best business and production decisions for his or her particular situation.

The good news is that many farmers are stepping up to the plate.

“My experience spans over 40 years, but in the last decade I find more and more farm families are realizing the importance of the succession plan process,” says Len Davies, principal of Davies Legacy 38 country-guide.ca

Planning Group Inc. “They are focusing on issues beyond just tax planning, but looking at tailoring a business plan and strategy that takes into account family dynamics as well as the business itself.”

They’re even coming to accept some of the hardest truths. “The failed farm succession,” Davies says, “is not the fault of an accountant who made a mistake. Rather it usually is a result of some breakdown in the family itself.”

More push, more pull

“Farming has become sexier,” says Lance Stockbrugger, a chartered accountant, consultant and full-time farmer of 4,000 acres in east-central Saskatchewan. “In recent years, it has become a viable and desirable option for the next generation, and it is preparing itself accordingly.”

The next generation of farmers is pursuing a rigorous education in agriculture combined with usually, but not always, off-farm employment to gain independence, skills and a greater appreciation for the industry before it makes the decision to come back to the farm.

“The added difficulty with farming now being an attractive job and lifestyle, is that not only does one child want to farm, they may all want to,” Stockbrugger says. “How does the farm handle that? How can Mom and Dad and the kids figure out who gets to farm and who does not, and how to make that fair?”

There’s also more pressure for comprehensive succession planning, Stockbrugger says. “This is accomplished by thinking through how every major decision they make is going to affect the succession of their business.”

It also means looking reality in the eye. It may be that not all the children who would like to farm will be able to. “Try to make decisions that will make it easier to transition farm assets later on” says Stockbrugger. “As more family members become involved in the operation, more income is needed to provide for those families. This can be accomplished by having less custom work done such as trucking products to market, agronomy services and so on. Income could also be created by thinking outside the box entirely and starting new ventures — purchasing equipment for custom work September 2014

business

or finding work for existing equipment outside of non-peak times.”

However, when Stockbrugger conducts succession seminars and planning sessions for Farm Credit Canada, he still finds the audience is a “roomful of grey hairs.”

“There should be 20- and 30-year-olds in the audience, especially if they themselves have families,” Stockbrugger says. “Like saving for retirement, planning for a succession and having 30 to 40 years to do so gives you much greater ability to get your ducks in a row.”

Another advantage of thinking about and planning for succession with decades left on the clock is that more consideration can be given to farm business structures. “Corporations are the lowest-taxed business structures,” says Stockbrugger. “But it is very difficult to transition assets and land, especially to more than one successor and especially if those two are not going to be farming together.”

Stockbrugger usually likes to advise that the land be kept out of the corporation and a family trust be created to own the shares of the corporation. “While this is more costly to set up, it really does pay off in spades down the road with the flexibility it offers,” he explains. “Ownership structure should get a lot of attention very early on in the process.”

“ How can Mom and Dad and the kids figure out who gets to farm, and who does not?”

— Lance Stockbrugger Finding a way to talk

The message has gotten out that open and honest communication within the family about goals and aspirations is just as important — or even more important — than the financial aspects of the succession.

“Successors need to explore where they have deficiencies, for instance in financial management or human resource management,” says Davies.

“Once identified, these deficiencies can be worked on through training, off-farm employment opportunities, or mentoring.”

Indeed, in today’s environment, continuous skill development over the entire course of a farmer’s career is vitally important. Technology is changing in farming at an incredible rate, and if the farm doesn’t keep up with advances in technology or agronomy or anything else, it risks being left behind and becoming unprofitable.

“Failed successions, in my experience, have little to do with the business structure or the transition of

September 2014

assets,” says Stockbrugger. “Failed successions are often due to a lack of management training — the young farmer who has never had to spend $400,000 on a new combine or $20,000 on a repair. It can be overwhelming and despite their skills as an agronomist or operator, if they can’t manage the financials, failure is certainly a risk.”

Another bigger change in the last number of years as the business of farming has provided better, more reliable returns is farmers realizing that they need to work on the farm, not just at “farming.”

“Where is the farm business going to be in five years, 20 years?” asks Davies. “What needs to change when there are marriages, additions to the families and, unfortunately, farmers are not immune to divorce? These are all areas that should be considered and planned for.”

Another longtime practitioner and educator in the field of farm succession is Terry Betker, president and CEO of Backswath Management. He also lectures at the University of Manitoba and has lived through two farm successions of his own.

“In the last four to five years, the biggest change I’ve observed, for the first time maybe, is the accumulation of wealth in farm families and the impact that is having on succession,” says Betker. “We’ve seen this accumulation of wealth on the farm elsewhere in the EU and even eastern Canada, but now it is becoming the Western Canadian experience.”

Transitioning ownership and management in this environment and being fair and equal to everyone requires a lot of thought, planning and time. “Farms are also more complex these days,” notes Betker.

“The size of the business, the structure of the business and the human resources required to run the business can be as involved as any non-farming business of equal capitalization.”

The leadership challenge

Betker believes a much greater understanding of leadership is necessary to execute a successful transition.

“Farmers are realizing, whether they like it or not, that they have to spend less time on a tractor and more time at a desk,” says Betker. “This is a challenge for a lot of folks who are in this business because they truly love the work of farming, the outdoors, the machinery, the crops and animals and so on.”

Back in the early ’90s, awareness of succession planning was building. It really hit the radar later that decade as the farming population aged. The 2001 census showed there was a larger percentage of farmers over 55 years of age that in previous censuses.

“Now people are more aware that they should have some greater formality around the succession question,” says Betker.

Continued on page 40 country-guide.ca 39

business Continued from page 39 Now, however, the pendulum may in a way have swung too far. “I think it may have gotten to the point,” says Betker, “where there is now some mystique about succession, and maybe they overthink it.”

While there are no black and white answers to the questions of succession, it’s also not rocket science.

The biggest question or conundrum to solve is how the non-farming children are going to be treated.

“I am seeing more and more situations where the non-farm children retain some ownership in the farm business as shares, for instance,” says Betker. “There can be buyouts or exchanges of cash over time, or right away, as well. It really is for the family to determine their best strategy to keep the family on the same page.”

Another common theme is the retiring generation retaining or being advised to retain ownership in the farm. “Their continued ownership is their best risk mitigation strategy towards their own retirement and the continued success of the farm,” says Betker.

Betker also agrees with Stockbrugger and Davies that succession planning should be entrenched in good farm business management.

“Every investment and every strategy should be undertaken with a view to positioning the farm for the next generation,” says Betker. “I am finding that lenders are also moving in that direction. They are very interested in the long term view because that is just plain good business management.” CG

First steps

Are you getting more and more convinced that it’s time for a succession plan for your own farm? If so, here are some thoughts from the experts on how to get started, beginning with the most important question of all: What does our retirement look like?

“The retiring couple has to have a focused discussion on what retirement really means to them,” says Terry Betker of Backswath Management. “This means the when, how and what of retirement... their vision of retirement.” Betker goes on to say that most couples don’t actually have this sort of deep, detailed discussion and can sometimes find that when they do, they have very different views of what their retirement years will look like. “An ironclad plan is not critical at this point,” says Betker. “But this is an essential first step to take before involving the rest of the family in the process of succession.”

Bring the family together

Financial performance

Once Mom and Dad have talked about retirement and are on the same page, it’s time to have a family meeting.

“What’s important with this meeting is the purpose and the attendees,” says Betker. “All the children, and their spouses, should be at this meeting so everyone hears everything together. One-on-one meetings are not advisable at this stage of the process.”

“This first meeting is an exploration of what everyone’s goals are,” says Len Davies of Davies Legacy Planning Group. “By airing these aspirations to the group, there is less likelihood of making assumptions and causing family arguments later on.”

At the end of this meeting, the goal is to have some timelines, some expectations and some actions to follow up for the next meeting date, which also should be an outcome of this gathering.

At some point early on in the process, the family needs to understand what succession is going to mean for the financial performance of both the farm and the retiring generation. This is another area where experienced professionals can play an important role in analysis and advice. “This is also the time to look critically at the strengths and weaknesses of the business,” says Davies. “It also will unearth challenges the farm faces and what has to be done to prepare for the succession to be successful.”

Introduce accountability into the process At this point, the family should try to introduce some accountability into its succession process. “There are two easy ways to do this,” says Betker. “Either hire a facilitator who can help the family drive the process and keep it on track, or be rigorous about scheduling the next meeting date after each meeting.” By doing this, the process will be more likely to stay on track and on the schedule that has been agreed to by the family.

40 country-guide.ca

Seek out tools and resources “Every provincial government ag website is loaded with resources on farm succession,” says Betker. “So, too, are organizations like Farm Credit Canada and others.” While some may see these resources as overwhelming, they can be very helpful in enabling discussions through the use of the questionnaires and surveys they contain.

“If I had only one thing to advise farm families about succession, it would be the sooner the better,” says Davies in conclusion. “By creating a road map to succession with as much lead time as possible, the family can figure out how to service its debt, fund retirement and still grow the business.”

September 2014

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®

Succession In agricultuRe

It’s all different now High land prices are driving innovation in how to distribute your land

By Amy Petherick arming without some startup help from your family can definitely mean an uphill climb. But getting the gift of a farm inheritance isn’t always such a blessing either.

Many farmers will tell you it would have been impossible for them to get started in the business if it hadn’t been for a “hometown discount” from Dad or an early bequest from Mom. But examples of self-made farmers aren’t unheard of either.

It helps explain the surprise when ag economist Alfons Weersink at the University of Guelph studied farmland values for the Canadian Agricultural Trade Policy and Competitiveness Research Network in 2011, before the bull market of the last three years.

Weersink found Ontario land values had soared from $500 per acre in 1961 to over $3,500 per acre in 2009. But he also believes many, many farmers never really paid these full prices for their farms and he thinks at least one full generation of farmers across Canada got started with a familial gift of some kind.

“There was a wave of immigrants that came over after the Second World War with very little and started farming,” says Weersink. “But since that time, it has been the next generation of the family that has taken over land.”

Weersink doesn’t have hard numbers to prove what price the land has actually sold for on these farms, but it’s been his experience that some sort of discount is generally involved in passing the farm operation from one generation to the next, largely because of the high asset prices relative to the annual returns.

So the irony is that, while market prices for Canada’s farmland have certainly increased, it may only mean that the size of the gifted portion has increased by nearly the same amount.

It isn’t exactly what our wannabe farmers who don’t have a family property to inherit want to hear, Weersink says.

Young farmers who get a start with discounted land definitely have a competitive edge, Weersink says. And as the size of the gift increases, so does the edge. “It ends up improving their cash flow and increasing the farm’s profitability.”

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John Wilkin, director of business development for Allied Associates in London, Ont., agrees that it is much more difficult for beginning farmers who don’t have a spouse, parent, or grandparent to help them get their hands on some family farm assets.

Even so, Wilkin thinks rising land values have also made things a little less rosy for today’s farm heir too.

“The land has easily doubled, or in some cases tripled, just over a very short period of time so the non-farming children suddenly have an interest in what’s going on with the farm,” says Wilkin. “Back 30 years ago, Mom and Dad were eager to have one of the family carry on the farm and the only way that could be accomplished was to eliminate the other children from whatever funds might be left. The perspective is changing; there is a desire to be closer to equal than before.”

Wilkin says he is seeing more families than ever achieve this equalization through the use of insurance policies. Typically a “last to die” policy is purchased to ensure that, upon the parents’ deaths, there will be enough funds to buy out the nonfarming siblings.

This can work particularly well in conjunction with a corporate business structure. But Adrian Spitters, senior wealth adviser with Assante Capital Management Ltd. in Abbotsford, B.C., adds a warning. He says that if the corporation buys such a policy and if the proceeds go directly to the parents’ estate to be distributed to the children, these funds could be subject to tax.

Spitters suggests his clients talk to their accountant and their insurance provider about the option of making the farm corporation the policy’s beneficiary. “You want to take advantage of the capital dividend account within the corporation,” he says.

“If the money goes into the corporation, you can then disperse it so that the non-farming children get their money tax free out of the dividend account.”

In a heartbeat, Spitters can rhyme off all sorts of creative ideas for gifting the farm. Maybe it’s because British Columbia boasts some of this country’s highest farmland prices. Or maybe it’s because he has already lived through a generational farm transfer in his own family. For whatever reason,

September 2014

BUSINESS

Spitters offers a unique lens on the blessings and the challenges involved in gifting the farm.

“I don’t think there’s a way of saying there is a fair or equal way at today’s prices,” Spitters starts with. There are simply too many complexities to consider, in his opinion. For example, he points out that farm rollovers to family carry with them a tax bill which parents often forget about. As long as the children farm until their own children take the operation over, and their children after them in perpetuity, the tax bill just keeps getting passed on. But at some point, someone’s estate is going to wind up paying that bill when you get to the point where nobody in the family is willing or able to farm any longer. “You’re not getting rid of the tax, you’re just passing it on,” Spitters says. “If you’re the one who’s going to sell the farm because the kids aren’t going to take it over, you’re going to have this tax bill to deal with, and you need to plan for that somehow.”

“Non-farming children suddenly have an interest in what’s going on with the farm,” Wilkin says Plus, there’s another little-known curse in disguise, this time for the parents who bestow the farm blessing.

“When you roll over the farm tax free to the next generation, there is no attribution back to the parents if they hold on to the farm for more than three years,” Spitters explains. “But, if the kids decide they don’t like it or they run into financial difficulty and they’re forced to sell the farm within those three years, attribution rules will now make that tax bill payable back to the parents.”

This is why parents need to be protected to the fullest extent possible, says Wilkin. “When we had those high interest rates, there were many situations where Mom and Dad transferred the property and there was no security taken,” he recalls. “They could have easily put a second mortgage on (the farm), and it would have protected them where there were defaults, but instead Mom and Dad got nothing.” Wilkin says this is why it is a good idea for parents and their kids to get independent advice during succession planning. He realizes it is tempting to save a little money up front by sharing lawyers and accountants, but experience has taught him that succession is just one of those areas where an ounce of prevention is really worth a pound of cure.

If it’s starting to seem like the simplest thing to do is just to forget about gifting the farm to any family at all, especially if no one seems to REALLY want it anyway, and if it seems the best thing is just to bite the tax bullet that comes, Spitters offers one last fringe idea worth considering. “Farmers are giving people,” he observes. “Why not give to help young farmers who really, really want to farm?”

Spitters runs into young people who have what it takes to become great farmers, but they need a little help in getting started, and he suspects great alliances could form between such up-and-comers and “heirless” established farmers look-

ing to retire. To his way of thinking, if these farmers could donate to some sort of trust, with the trust responsible for setting up a low-cost loan or guaranteeing a bank loan to get the new farmer started, you would create a win-win situation for everyone involved, and you would also serve a public interest by seeing the heritage of the family farm protected. “Unfortunately, there is no way right now to actually donate farmland and get a deduction,” says Spitters.

Interestingly, Spitters’ idea is mirrored in an ongoing Ontario Farmland Trust Agricultural Gifts campaign, which is also being supported by such organizations as the Nature Trust of New Brunswick and the Land Conservancy of British Columbia. Advocates are calling for the extension of the Ecological Gifts Program, which offers income tax incentives in exchange for voluntary donations of ecologically significant land or conservation easements to designated conservation agencies, to include donations of productive agricultural land.

Spitters believes such programs could solve some of the cost issues that keep so many young farmers out of the industry by transferring land ownership out of the trust as a critical component. It’s a pattern already set by the Maine Farmland Trust. Since 2007, that trust has purchased five farms deemed vulnerable to development, placed conservation easements on them, and resold them to farmers. CG

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business

Swede Hawk

Curiouser and curiouser… corn brings Swedish equipment manufacturer Väderstad to rural Saskatchewan to buy the Seed Hawk brand

he sign at Seed Hawk’s air drill manufacturing facility in rural Saskatchewan says “Welcome.” Maybe, though, it should now be “Välkommen,” seeing that Väderstad, a global tillage and seeding equipment brand founded and still headquartered in Sweden acquired a minority interest in Seed Hawk in 2007, and earlier this year took over its former Canadian partner.

“We have been part of Seed Hawk since 2007 and we know each other very well,” said Christina Stark, CEO and managing director of Väderstad, during an exclusive interview with Country Guide earlier this summer. “So it was actually a very natural step when we bought the rest. We are both technically innovative, driven companies. And we are always thinking of how we can develop products that are best for farmers.”

It was that technical innovation that actually led to tighter integration between the two brands, and it’s ultimately what drove executives in their respective corner offices to realize that a Swedish takeover made sense from both sides of the Atlantic.

“ We know each other very well,” says Christina Stark, CEO and managing director of Väderstad.

44 country-guide.ca

“They were looking at how to get (the new Väderstad Tempo high-speed corn planter) into the North American market,” says Pat Beaujot, former president of Seed Hawk and now its director of strategic market development.

“We started talking about how are we going to do this. We’ve got a company that they own 49 per cent of that wants to be a part of the U.S. corn market. For freight reasons they looked at whether they should build the planter in Iowa in the heart of corn country. We convinced them they have a good factory here. It can only be more efficient if we just get bigger. I think in the end they decided we were probably right. It’s better to grow the plant where it is.”

Väderstad agreed, but didn’t feel comfortable investing that much more in the plant without owning more of it, which was a point that made sense with Seed Hawk’s Saskatchewan owners. But the Saskatchewan team couldn’t see pumping in the dollars that the corn expansion would require.

“That required more investment than we were ready for at our stage,” Beaujot says.

“When we launched the Tempo, which can work at higher speeds, we saw the possibilities in North America so we wanted to keep on investing here,” confirms Stark. “We had a discussion, and after a while we came to the conclusion that it was time for us to take over the rest (of Seed Hawk). We saw a lot of synergies between the companies, also with R&D and sales development.”

Those synergies were the reason Väderstad management first decided to partner with the Canadian firm.

“We were looking for big air seeders for the market in Australia, Russia and Kazakhstan,” says Stark.

“Seed Hawk was mainly sold in Canada and we had a big market in other parts of the world, so it fit very well together and there were no competing products.”

That also made Seed Hawk drills part of a larger line of products here. From Beaujot’s point of view, expanding Seed Hawk’s offerings was important for maintaining the long-term viability of that brand.

“I could see corn and soybeans were moving north into our country, and that was going to reduce the air seeder market a little bit, and I had been concerned about that for a number of years,” Beaujot recalls. “There is an evolution of how people will farm in Saskatchewan.”

September 2014

Photography: Scott Garvey

By Scott Garvey, CG Machinery Editor

business

Currently, the global market for tillage and seeding equipment is a relatively crowded one, so technical innovation and a good product line are front-andcentre priorities for the survival of any brand, whether it has a regional or global focus.

“There are a lot of manufacturers,” says Stark.

“You have to keep on with development and keep on being ahead of your competition.”

So with the official takeover announcement early in 2014, Seed Hawk became a Swedish-owned firm. But its products won’t simply be absorbed into Väderstad’s equipment line. Instead, its Canadian-built air drills will retain their familiar name, and the firm will continue to operate autonomously from its Saskatchewan home.

“We have made Väderstad and Seed Hawk what we call sister companies,” Stark explains. “It means there is no one at Väderstad in Sweden who will be the boss of Seed Hawk. Our long-term ambition is to keep on investing in Seed Hawk, where it is situated in Langbank.”

There will, of course, be a new CEO at the helm, yet Seed Hawk’s current principals, Beaujot and Brian Dean, vice-president of research and development, will remain with the company as senior executives for the foreseeable future. “We’ve signed on for five years,” says Beaujot. “We’ll see where things go after that.

They wanted us to stay on during the transition.”

Transitioning a previously independent company into its fold is new territory for Väderstad management. Despite its global footprint, the firm has never taken over another brand.

“It’s the first ever,” Stark says with a smile. “We September 2014

have 12 subsidiaries, but only for sales, and we have a small, small production facility in Russia. But this is the first time we buy another company.”

Retaining the existing executive staff in Saskatchewan seems likely to not only ease the integration, but also to help Swedish owners deal with the cultural differences that could be a stumbling block if not handled correctly.

“Of course, there are cultural differences between running a company in Canada and in Sweden,” Stark acknowledges. “You make sure you travel here frequently and some Seed Hawk staff travel to Sweden to get good co-operation between the companies, which is most important, getting people to work together.”

The acquisition gives Väderstad an even stronger foothold for growth in North America. It also means the Langbank, Sask. plant will see faster expansion in the near term. Beyond that, Stark isn’t ruling out further acquisitions as part of the brand’s global strategy.

“It could be part of it at least,” Stark says. “Maybe in the future there will be something more coming.”

But it is unlikely executives will want to wander outside their current manufacturing field by adding additional equipment types. Instead, expansion into previously untapped market regions is more likely.

“We think we should stay with seeding and tillage,” Stark says. But she does seem to have a neversay-never approach to business, and she pauses and smiles at the question of expansion plans.

“There are always possibilities,” Stark says. “You shouldn’t restrict yourself too much. We’ll see what the opportunities are.” CG

Development of the Tempo high-speed corn planter was the impetus for Väderstad taking over its Canadian partner, allowing it to further develop North American markets.

country-guide.ca 45

Legal

Firing an employee It’s best to understand not only the law, but its principles

By Naomi Loewith he best “strategic business thinking” requires not only knowing the law, but also understanding the policies behind it. Many readers will have had to terminate an employee. In this article, I discuss the principles behind the rules for termination “without cause,” that is, where an employee has not done anything that merits being fired, but the relationship simply no longer works. I also note two areas where evolving policy is pushing employment law to change.

When terminating any employee (except for those with a fixed-term contract), an employer must give appropriate notice that the employment is being terminated or give termination pay “in lieu of notice.” The purpose is to give employees, who depend on an income, a reasonable cushion to find alternative employment. An employer can thus give the required notice and the employee will keep working, or pay the employee a lump sum for the notice period but the employee stops working.

The length of notice is determined by a number of factors, including how long the employee has worked, his age and qualifications, and the availability of replacement employment. Each province has a statute that sets out the minimum amount of notice based on the length of employment, but the other factors will usually increase the required time.

Severance pay, on the other hand, is intended to compensate employees for their loss of seniority and their investment in the employers’ business. Severance pay is an additional entitlement that some provinces require employers to pay to longtime employees. In Ontario, for example, employees with more than five years of service are entitled to severance pay if the employer has a payroll of over $2.5 m, or is shutting down completely.

Duty to mitigate A dismissed employee has a duty to mitigate his damages.

That is, he must make the best of the situation. He must take reasonable steps to look for new work and to accept that work if it is available. He is not required to take any available job — he can look for a position with a comparable salary, similar working conditions, and in an environment that is not acrimonious or demeaning.

The same principle applies whenever a harmed party seeks compensation in court. For example, a landlord has a duty to look for another tenant when a tenant breaches a lease and a seller must try to resell his goods if a committed buyer fails to purchase them. This is consistent with the long-standing social policy to encourage people to find a solution before seeking relief in the court, and to preserve (or create) economic value where possible.

Aggravated damages The manner in which an employee is terminated can also affect his entitlements. In the course of a dismissal, an employer

46 country-guide.ca

ought to be candid, reasonable, and forthright. If the employer treats the employee in a way that is unfair, misleading or unduly insensitive, the employee may be entitled to an extra level of compensation called aggravated damages.

An employee might also get aggravated damages if an employer tries to fire him “for cause” where there was no true basis for doing so.

The courts set a high bar for aggravated damages. Employees take a job knowing that it might not last forever. Aggravated damages are only available where the employer’s conduct in terminating exceeds what reasonable people would expect in a professional relationship.

Two areas of development As the business landscape in Canada changes, protections for employees are increasing in two areas in particular.

First, employment law has long distinguished between employees and independent contractors. Courts determine if someone was an employee by looking for the indicia of a “master and servant” relationship, such as how the person is paid, who directs the activity, and who owns the tools of the trade.

Employers have notice obligations to their employees, but not to independent contractors who work for them.

However, in recent years the courts have expanded the idea of “dependent contractors.” These self-employed contractors are entitled to notice or payment in lieu where they have hallmarks of being employees, such as working exclusively for one employer or being economically dependent on that employer.

Second, courts are expanding the extent to which employers must accommodate employees with disabilities. The general rule is that if an employee is no longer able to perform the tasks of the job, the employment relationship has been “frustrated” and can be terminated, subject to notice and severance entitlements.

However, if an employee cannot perform the tasks because of a disability — and the courts apply a broad definition of disability — termination is only permitted where it would create “undue hardship” to accommodate the disabled employee.

Employers may therefore have a duty to reallocate tasks, purchase special equipment, and adopt creative solutions to accommodate an employee. The guiding principle is that employment provides not only income but a sense of identity and self-worth, and courts increasingly require employers to facilitate employment.

An employer’s duties will always depend on the situation, but it is helpful to understand the principles and policies that inform these obligations. CG Naomi Loewith is a lawyer at Lenczner Slaght in Toronto. As a business litigator, Naomi advocates and manages risks for clients in a variety of sectors, and has experience in actions involving all levels of government.

september 2014

production

Join the club With clubroot escaping beyond its Edmonton hot zone, the rest of the Prairie region must get its response right

By Gord Gilmour, CG Associate Editor

s you drive throughout the region surrounding Edmonton, canola is inescapable. It’s absolutely everywhere.

And looking at the crops, it’s easy to understand why. With long days, cool nights and adequate rainfall, this is canola country pure and simple, and in most seasons, the crop flourishes under nearly ideal conditions.

Canola has also been a crop — the only one over a long stretch from the early 1980s to early 2000s — that has reliably paid the bills. Small wonder then that farmers here and elsewhere have pushed their canola rotations as tightly as they have.

Typical here is a two-year rotation that switches back and forth between canola and either wheat or perhaps another cereal. A few holdouts continue to grow peas, but larger farm sizes make that toughto-harvest crop less attractive, and growing disease pressure has made peas less economic.

The two-year rotation, however, has contributed to the severity of clubroot, a pernicious soil-borne disease that’s now wreaking havoc among canola growers throughout the district.

Clubroot is a disease that’s never quite been seen in the same way anywhere else around the globe.

And when it first appeared here, nobody could quite believe it.

September 2014

The root of the problem Back in 2003, Dan Orchard was a young man, not many years out of university, working as an agronomist for a retail outlet in Sturgeon County, just north of Edmonton when he got a call from a grower who had an unexplained near-total failure of a canola crop. He asked Orchard to come see it.

After surveying the damage, Orchard pulled a few plants and was stunned by what he saw — malformed roots with enormous growths on them.

“It was absolutely incredible,” recalls Orchard, who now works as agronomist for the Canola Council of Canada. “There were growths the size of softballs and grapefruit on most of the roots, and some even larger, almost the size of footballs.”

Neither Orchard nor the affected farmer had ever before seen anything like it — but Orchard did have an inkling of what it might be. Due to what he himself calls “dumb luck,” he had happened to write a major paper in his final year at the University of Alberta’s agriculture program on canola diseases.

“I had needed to look at canola diseases, and I needed to discuss three,” Orchard explained. “The problem was, there really only were two — scleroContinued on page 48 country-guide.ca 47

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Uniquely Canadian

tinia and blackleg. I picked a third one that had been a very minor problem, in other places, just to have a third disease. I picked clubroot.”

That fall in 2003, Orchard says he almost immediately began to suspect clubroot, and he even went so far as to call the province to tell them — but they weren’t convinced. They suggested he get a plant pathologist to look at it, causing Orchard to circle back to his alma mater, the U of A. “I actually called my old plant pathology professor and asked him to look at it,” Orchard says. “He took one look at it and said it was clubroot, put in under the microscope and immediately confirmed it.”

After a somewhat frustrating runaround, suddenly the problem was now being taken as seriously as a heart attack. The next step was to show it to a pathologist, which was when the full gravity of the situation really hit home to Orchard.

In most other regions of the world, clubroot is a minor annoyance. It does hit a handful of relatively high-value vegetable crops, but there are soil amendments that can knock it back. The trouble is, those treatments are expensive. They make sense if you’re grossing a few thousand dollars an acre with broccoli, but not a few hundred on canola.

In the few areas like the U.K., where the disease does exist and where they grow canola, farmers typically have many more cropping options that provide economic returns. In short, when the disease does pop up, the farmers have options.

Stephen Strelkov is a plant pathology professor at the University of Alberta, who had just joined the faculty less than two months before the first case of clubroot made headlines. He says like most Canadian plant pathologists, he had heard of clubroot and read about it in a textbook, but it was hardly something he was expecting to spend a large portion of his career on.

“It was the last thing in the world I ever expected to find myself working on,” Strelkov tells Country Guide. “But just a couple months after I started, the first sample of clubroot came in, and we had to get up to speed on it really quickly.”

Part of getting up to speed included making contact with people around the world who had already been looking at the disease. One of the first names he encountered was Geoff Dixon, a professor at the U.K.’s University of Reading. Strelkov sent him an email detailing the situation, only to receive a surprising response.

“He emailed me back and basically said, ‘I’ve been waiting a generation for your message,’” Strelkov says. “Apparently, back in the 1970s, people working on clubroot in Europe would get together and one of the questions they always asked was, ‘Why isn’t there clubroot in Canadian canola fields?’”

The answer starts with the unique biology of clubroot and its relationship to its host plants. Clubroot had long infected other crops — things like broccoli and cauliflower — that like canola are in the cole family. In fact, that may be how it came to be in the Edmonton region, carried along on saved seeds from these crops by immigrant farmers.

If so, it had hung out in soil at low levels, until something new came along in the 1970s — the canola industry. Suddenly there were susceptible crops everywhere, not just in little pockets like home and market gardens. But clubroot couldn’t run rampant just yet. It needed a few seasons to feel out this new potential host and find a way to tap into it — a process that’s known as developing affinity.

Whether this is how clubroot arrived, or if some other mechanism brought it here, the table was soon set for the disease’s inexorable march through the region.

Country Guide contacted Dixon, one of the acknowledged global experts on the disease, to talk about the Canadian situation. “You’re dealing with a global commodity crop with a huge financial value, and where there are industry bodies with real muscle,” Dixon says. “Stephen Strelkov and his colleagues have done a masterful job of identifying the size and scale of the problem and those approaches that are agronomically feasible and those which are not.”

All in all, he says, it’s turned Canada into the global leader on clubroot, Dixon says. The U of A’s Strelkov agrees, but adds it’s something everyone involved could do without.

“It’s a bit of a dubious distinction,” Strelkov says, “but I would say we’re at the forefront of this fight now.”

In 2003, Dan Orchard got Canada’s first clubroot call.

It was, he says, “something from a horror movie.”

“I showed it to him, and he wandered around the field like a zombie for almost 20 minutes, not saying anything,” Orchard says. “It was like he’d seen something from a horror movie, and that’s when I realized just how serious this must really be, when I saw how concerned these two plant pathologists were.”

At the end of the field inspection, the pathologist delivered a sobering assessment to Orchard: “He told me that I now needed to decide if I was going to go public with this, or if I was going to shoot, shovel and shut up.”

It was a phrase made famous by former Alberta premier Ralph Klein about his attitude to endangered wildlife legislation.

The ultimate decision was to go public, since the disease threatened far more than just a single canola crop in a single field; left unchecked, it could in fact threaten the entire canola industry in an affected area.

A few days later, at a press conference, the disease was revealed, and the modern era of clubroot control started for growers in the Edmonton area. It hasn’t always been a pleasant one. More than a little anger and animosity have spilled over, especially over issues like enforcing longer canola rotations on the hardest-hit fields. But it seems in hindsight that something had to be done. Left unchecked, biology would ultimately trump any hope of growing canola in tight rotations.

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September 2014

production The response Part of what’s made the fight against clubroot so difficult is the complex nature of the disease and the way it responds to traditional control strategies.

It can help to picture the situation as a GIS map.

A company that wants to sell home alarm systems might start with a basic grid map, and then overlay data on household demographics, income and crime rates. By doing so, it could prioritize where to invest its marketing effort.

Now imagine a map of the Edmonton area overlaid with the biology of clubroot, the economics of agriculture, and local politics. Suddenly, it doesn’t seem so simple.

Begin by getting a clear picture of the scope of the problem. Strelkov says the spore count in the soils is the key. A canola crop can probably survive and do well if the spore levels are kept low — a few thousand per gram, say. But the disease can ramp up quickly with tight canola rotations, and measurements in the hundreds of thousands and even over a million spores per gram aren’t uncommon in the most heavily infested fields, Strelkov says.

“Say you have a half-million spores per gram, and you need to get it down to a few thousand per gram to produce canola economically,” Strelkov

says. “Now realize that the half-life of these spores is about four years. So in four years you’re down to 250,000 spores, in eight years 125,000, in 12 years 62,500… a serious infestation can easily take a field out of canola production for 20 years, assuming no resistant varieties.”

It raises the question: is clubroot a potential canola killer?

“Yes, absolutely,” Strelkov says. “Especially if there are no resistant varieties, or if the resistance breaks down quickly, which we’re already seeing some evidence is the case.”

He’s referring to the introduction of the first clubroot varieties in 2009. Just a few seasons later, there already seems to be some evidence the disease populations have shifted and new strains are sidestepping that resistance. Geoff Dixon says he’s unsurprised by the news, saying it’s pretty typical of what they’ve seen elsewhere.

“The pathogen is very capable of evolving in order to circumvent resistance,” Dixon says. “It’s the classic ‘boom and bust’ seen many times in other pathogens.”

To understand why resistance breaks down so quickly, researchers think about it in similar terms to how weeds develop chemical resistance. In that Continued on page 50

Resistance is crucial to Canada’s clubroot plan. But is it realistic?

Could clubroot destroy a region’s ability to grow canola?

“Absolutely,” says the University of Alberta’s Stephen Strelkov

September 2014

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Continued from page 49

Getting it right

case, the repeated application of a herbicide over many years “selects” for the very few individuals which have natural resistance to the chemical. All the vulnerable individuals die off, leaving only the resistant plants to breed, resulting in a turnover of the weed population and what seems like the sudden emergence of a full-blown resistance problem.

In the clubroot scenario, growers with heavy disease pressure have little choice but to plant resistant canola, yet the sheer number of spores can quickly overwhelm the resistance through the same mechanism of selecting the small handful that can survive. After four or five seasons or so, their numbers creep high enough to hurt the crop’s yield.

“Selection pressure is always a numbers game, and we’re dealing with big numbers here,” Strelkov says.

In 2007, the Alberta provincial government declared clubroot a pest under the Agricultural Pests Act, giving legal teeth to efforts to contain the problem, and bringing politics and economics into the equation. (Saskatchewan followed in 2009.)

Inevitably this also kicked off some serious controversy, since one of the tools for reining in clubroot calls for enforcing four-year or even longer canola rotations in the hardest-hit fields. Telling their neighbours what they can and cannot grow isn’t the kind of job most rural politicians thought they signed up for.

It also led to surprising divergences in response throughout the area because of a quirk in how local affairs are ordered.

In Alberta, a lot of responsibility for pest issues falls to the local counties through their agricultural fieldmen, who take direction from the local government.

“Some counties took it very seriously, right from the start, coming up with a plan and periodically revisiting it,” says Dan Orchard. “Others thought farmers should be left to manage it themselves and basically had no policy. Another group set policies, then never revisited them as the situation evolved.”

It made for a patchwork of solutions with varying degrees of success, from draconian policies that alienated growers, to a laissez-faire free-for-all, and everything in between. If one thing has become apparent in the Alberta experience, however, it’s that good policies count for something.

Again and again during Country Guide’s visit to the affected area, a variation of the same theme came up: “Want to see clubroot control in action? Visit Leduc County, because they’re getting it right.”

We caught up to agricultural fieldman Aaron VanBeers one morning at his office in the agricultural services building of the Leduc County Centre. It was a bright sunny day, the canola was all entering full bloom, and the crops were looking great — all this despite being at the very epicentre of the clubroot zone, one of three counties that show up on the Alberta government’s clubroot map in bright red, indicating the heaviest infestations.

We begin a wide-ranging discussion about what’s worked in the county, and VanBeers says it all boils down to taking clubroot seriously, getting on it right away, working closely with local farmers, avoiding alienating them, and being willing to revisit and redesign policies as the need and ability arise.

“My predecessor, who was also a farmer, realized right away how serious this was,” VanBeers says. “The local government and the agricultural services board also understood quite early what we were facing.”

They surveyed all the canola fields in the county — a practice that continues today — to determine the scale of the problem.

They imposed longer rotations on the hardest-hit fields, after very carefully communicating to growers why this was necessary. And when more information about the disease became available, and the first resistant varieties appeared, they relaxed rotation restrictions on lower-risk fields.

What VanBeers describes is good old-fashioned political leadership. A difficult situation was faced up to square on. Policies based on facts were developed, then periodically re-evaluated as new facts emerge and the understanding of the situation evolves over time. And as a result, while nobody likes the situation, everyone more or less continues to work together to keep the problem under control.

“I think most farmers in the county understand what we’re doing, why we’re doing it, and they support it,” VanBeers said. “Of course there’s always that two per cent — actually it’s probably even quite a bit lower than that — that you’ll never get through to, that think they should just be allowed to

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“ Farmers in the county understand what we're doing,” says Leduc’s Aaron VanBeers

September 2014

production The dos and don’ts of clubroot By now it’s clear. Some control strategies work. Others, says Dan Orchard, just don’t.

do whatever they do, without considering the impact it has.”

Essentially the approach in Leduc County is much like one that public health officials would use when dealing with a communicable disease, with steps being taken to limit the ability of infected individuals to spread it to new victims. But of course, there’s another dynamic at play too, of shame and secrecy. A growing number of farmers don’t want to talk about the disease, or let anyone know it’s on their land.

In no small part that’s because frequently the disease has been portrayed as something that’s linked to bad farming practices, ignoring the economic necessity that farmers in the region have laboured under for decades.

The situation is going to continue to evolve, but one thing is beginning to appear quite clear — it’s likely to become an issue for more growers in more areas as time rolls on. Orchard says there’s a wealth of information to be found from what’s happened in Alberta.

“I do think that other places that are starting to grapple with this problem can learn from what we did right and the things that didn’t work out as well,” Orchard says (see sidebar).

One thing Orchard is firm about is the necessity to face up to the disease and deal with it head on, drawing the familiar analogy to a serious health challenge. Like many human diseases, early diagnosis almost always equals a better prognosis, as a doctor would say.

“If you catch it early, if you catch it when the spore level isn’t too high, it’s always going to be easier to deal with,” Orchard says.

And while some say Orchard deserves credit for spotting the disease, he quickly downplays his own role, saying any competent agronomist would have figured it out fairly quickly, if they’d seen that first field.

“I guess finding it is my claim to fame in the agriculture industry in Western Canada,” Orchard says. “But really, it’s not something I’m proud of. I should have found it 10 years earlier, before it was such a big problem, but it just wasn’t the practice at the time to go out and pull plants from small dead patches in the field at harvest time.” CG

S epte m ber 2 0 1 4

• Pulling plants from dead patches at the end of the season and looking for the disease certainly worked. But it would have worked even better if the recommendation right from the start had been to pull plants and check the roots. By not stressing the importance of checking fields early and often, many a case was left undetected until inoculum levels rose and it was suddenly a crisis situation.

• Tillage certainly seems to be linked to occurrences in fields, says Orchard, who has seen the same pattern again and again, where a field will be largely untouched, except for the small portion that received some tillage. “Tillage appears to speed or promote clubroot,” he says. Once it has a toehold, tillage also helps it spread.

• I n peripheral areas, that either had very low-level infections or had none but were adjacent to areas that did, a more vigorous approach probably would have helped in the early days. “They weren’t looking until it was an obvious problem,” Orchard said. “It was a reactive, not proactive, response.”

• R esistance is our best option, and should be used in areas outside the clubroot hot zone to prevent spore buildup and to keep the disease at a low level. But growers should also respect that the disease is highly adaptable. If the resistant varieties are simply seen as a way to go back to business as usual, clubroot will likely make short work of them.

• W hen a small patch of clubroot is identified early in the infection process, growers should see it as a chance to nip it in the bud. One strategy that has shown some success is treating that portion of the field differently — say seeding it to a non-host crop like grass for a few years. It might cost you a few acres, but it could keep the rest of the field in production.

Clubroot control strategies do work, but the learning process is still underway.

• Equipment cleaning is one of the strategies that both worked and didn’t work, Orchard says. A key error appears to have been going out early with the message that producers needed to pressure wash and disinfect equipment. A better message might have been concentrating on more practical things, like dramatically reducing risks by removing visible dirt between fields, and leaving infected fields until last to ensure no transmission and adequate time to clean. “The power wash and disinfection message was not a practical solution,” Orchard said. Given that the disease can also transmit via wind and water erosion, minimizing risk was likely a better message. Still, most researchers say farm machinery is the single most important cause of clubroot spread.

• Research has proven very important, though Orchard concedes to date the agronomic research has been as much about what you can’t do as what you can. “That shouldn’t discredit the research or make it appear any less important,” Orchard insists. “Often finding out what doesn’t work is as important, if not more important, as finding out what does work.”

• Talking with the oil industry has also worked very well, and while it might sometimes still make a handy scapegoat, the other major land-using industry in Alberta does appear to have taken heed, especially those working in areas with a long history of the disease. “We do occasionally still have problems with companies that aren’t familiar with the issue, but for the most part I think the oil and gas industry takes this very seriously,” Orchard said. “At times I would say they take it more seriously than some people in the agriculture industry.” country-guide.ca 51

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2014 harvest quality Here’s how Cigi figures out if your wheat will make good bread

By Trevor Hnatowich elping customers make wise buying decisions is an important part of customer service. This is especially true when buyers are purchasing significant quantities of a commodity produced thousands of kilometres away — like wheat grown in Western Canada for example.

For over 10 years, Cigi (Canadian International Grains Institute) has completed an annual harvest assessment, providing farmers, grain handlers, and customers of western Canadian wheat with information on the quality and characteristics of each year’s new crop. This collaborative effort involving farmers, grain companies, and Cigi is Canadian customer service at its best.

Cigi collects representative samples from the major grain handlers from several regions across the Prairies — defined mainly by transportation routes as well as by climate and soil types — to determine information such as protein content, milling and flour properties, and the end-use suitability typical for each wheat class.

“We ask the grain companies to compile the samples together so that they are representative of not necessarily just one producer’s farm, but rather, what the quality in that region looks like,” says Rex Newkirk, Cigi vice-president for research and innovation. “It’s what allows us to provide quality information that’s as relevant as we can get on what the crop looks like from a commercial perspective.”

When Cigi receives the samples from the grain companies, technical staff then create composite 52 country-guide.ca

samples to ensure the analysis is representative of what will be shipped from each region.

“After a company from one of the regions has submitted samples, we’ll take a portion of its wheat samples and blend it with portions of other companies’ samples to make a composite sample,” says Elaine Sopiwnyk, director of science and innovation at Cigi.

The composite samples then undergo extensive testing to detail the characteristics of the crop.

“On the wheat, we measure protein, ash, falling number, kernel hardness and milling yields,” Sopiwnyk says. The wheat is milled at Cigi and the flour is analyzed for protein, wet gluten content, starch damage, colour and rheological properties using the farinograph, alveograph and extensograph.

Newkirk says that in addition to these tests, Cigi uses its facilities in baking, noodle and pasta processing to develop end products with the composite samples. Cigi technical staff can simulate the processes used in small- and large-scale commercial facilities around the world to ensure that the information gained is as relevant as possible to potential wheat buyers.

Cigi compiles information for the top classes of Canadian wheat and for downgraded material as well, adds Newkirk. “We look specifically at things like how to use downgraded material. Not only do we want quality information on the top grades, but we need to understand the quality of the downgraded material so that we can advise customers on how to best make use of it should there be a significant amount.”

After the tests are complete and the information is analyzed, Cigi prepares presentations and SEPTEMBER 2014

PRODUCTION

In photo at right, Cigi’s Juan Carlos Arriola (l), technical specialist in milling technology talks wheat at a potential customer’s Chilean flour mill while on the Latin America New Crop Mission last winter. brochures that are used to inform both domestic and international audiences about the new crop.

“Customers are trying to make wise buying decisions, but without good data, this is difficult,” says Newkirk. “So this harvest assessment gives them as much information as possible so that the cus-

tomer can make those buying decisions and get that grain off the Prairies. Customers have many options. Why would you buy from Canada if you aren’t aware of the quality? Wheat buyers need that information.”

In the fall, Cigi embarks on new crop missions around the world, mak-

ing presentations on the results in order to develop international markets for Western Canadian wheat. With the information from this year’s crop, Cigi’s technical staff will be going to Asia, South America, Europe, the Middle East and North Africa.

“It’s a major undertaking for us,” says Newkirk, “and it’s a really important service for farmers, for the industry and for buyers.” CG

Lead by

Example

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ALWAYS READ AND FOLLOW PESTICIDE LABEL DIRECTIONS. Monsanto and Vine Design ® and Roundup Ready ® are registered trademarks of Monsanto Technology LLC, Monsanto Canada, Inc. licensee. ©2014 Monsanto Canada Inc.

Production

Cut canola later, and combine it slower Canola harvest losses can be a lot worse than you think.

Swathing later is one way to boost yield. Refining your combine ground speed and other settings is another

By Jay Whetter

anola growers are leaving a lot of yield on the table. Or, more accurately, they are leaving a lot of yield “off” the table and on the ground. Estimates put losses from the harvest process alone at two to five bu./ac., on average. Early swathing adds to that total.

Growers have two key ways to recoup some of that yield. They can leave the crop standing longer, which gives side branches longer to fill, thereby increasing overall seed size and yield. And they can take steps to reduce losses while combining.

Chris Holzapfel, researcher with Indian Head Agricultural Research Foundation (IHARF) at Indian Head, Sask., led a 2013 study into straight combining canola. The study compared two swathing times and various straight cutting times. Early swathing

time — at 15 to 20 per cent seed-colour change for this study — produced the lowest yields of all treatments. The other options, which were swathing at 40 to 50 per cent seed-colour change or straight combining at various dates, produced a statistical increase in canola yield over early swathing.

Based on previous research it had done showing similar results to the IHARF study, the Canola Council of Canada (CCC) recommends swathing at 60 to 70 per cent seed-colour change for yield and quality.

“We know that not all canola can be swathed at this ideal time, given the logistics of harvest, but growers can expect an increase in yield if they can hold off swathing their first crops until at least 30 to 40 per cent seed-colour change and aim to swath the bulk of their canola at 60 to 70 per cent,” says Angela Brackenreed, CCC agronomy specialist.

Seed-colour change is when seeds show any amount of yellow or brown to indicate they’re turning from green. This photo also demonstrates how exterior pod colour is not an indicator of seed-colour change. Green pods can have brown seeds inside.

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September 2014

production

Combine losses Once the crop is down, the next step is to combine it efficiently — which means finding a balance between timely harvest and not going so fast that you leave a lot of bushels behind.

“Harvest losses happen, and they’re probably a lot bigger than many growers want to imagine,” Brackenreed says.

Rob Gulden, professor and researcher at the University of Manitoba, led a recent canola harvest loss study, which surveyed canola fields across the Prairies from 2010 to 2012.

Harvest losses ranged from 2.3 per cent to 11.2 per cent across the 310 fields. The study included a questionnaire with each grower to find management practices that correlated to those harvest losses.

A key discovery was that higher plant density reduced harvest losses. “The study showed that harvest management starts at planting, with the goal of achieving a high-density stand that will mature evenly,” Gulden says. “Getting the harvest timing right, which is a critical part of reducing losses, is linked to stand densities. Cutting seeding rates is not the best idea from a harvest management perspective.”

Higher combine ground speed was another factor that led to increased harvest losses. There is no one ideal combine speed. It varies by crop conditions and combine settings, and a grower’s tolerance for losses.

The CCC ran a series of combine clinics a few year ago featuring Les Hill, program director of agriculture and bioresources at Prairie Agriculture Machinery Institute (PAMI). Step one, Hill says, is to measure losses. This requires some work with a drop pan to see how much is thrown over the back of the combine. If losses are unacceptable, then take steps to reduce them.

Combining slower is one of these steps that can reduce losses. The loss curve tends to remain fairly flat until ground speed reaches a critical point. “When a combine hits that wall, a lot of the time it’ll start dumping grain out the back,” Hill says. It may take just a small decrease in speed — say 0.2 or 0.3 mph — to provide a significant reduction in losses, he adds.

Other adjustments such as concave spacing, fan speed and sieve settings can make a difference too. Try one variable at a time and check losses between each adjustment. Ground speed may be the last adjustment you want to make.

“In the end, the grower’s goal is to recognize where yield loss is occurring — whether that’s as a result of swathing too early or combining too fast or some other harvest factor. Windrows blowing in the wind is one of these other factors,” Brackenreed says.

“Increasing profit often comes down to a bunch of small incremental decisions that, on their own, don’t seem like a big deal,” she adds. “These can include seeding a little heavier, swathing a couple of days later and combining a fraction slower.” CG Jay Whetter is communications manager with the Canola Council of Canada. To read a summary of Rob Gulden’s harvest loss study, see the C anola D igest S cience E dition 2013 here: http://www.canolacouncil.org/canola-digestpast-issues/. Look for study 4.1. For more tips from Les Hill on how to check for losses and how to adjust combines, go to www.canolawatch.org and search for the article “Reduce costly harvest losses — tips.”

S e pt e m b e r 2 0 1 4

How to measure seed-colour change Seed-colour change (SCC) is considered any amount of yellow or brown on the seed.

To measure SCC, start in an area of the field that best represents the stand, stage and yield potential of the crop.

Pull a plant and isolate the main raceme, which is typically the longest branch with the most pods and greatest percentage of yield. Take pods from the bottom, middle and top of the main raceme.

For 60 per cent SCC, seeds from pods at bottom third of the main raceme will be totally brown to purplish brown, seeds from the middle third will be starting to turn, and seed from the top are green but firm and will roll between your thumb and forefinger without mushing.

Check five plants in this area, then repeat in another couple of places in the field.

For a video on how to identify SCC, go to www.canolawatch.org and search for the article, “How to determine overall seed-colour change.”

Canada’s Annual Ag Outlook Conference

February 23 & 24, 2015 The Fairmont Winnipeg

Farming has become a competitive business once again, as it usually is. One way to do the best you can on your farm is to grow the crops that the market will want.

Wild Oats Grainworld, Canada’s Annual Ag Outlook Conference, will be held in Winnipeg on Feb 23 and 24, 2015. Traders of the crops we grow in western Canada will give their outlooks for crops that they trade.

Grainworld is a rewarding experience. You’ll mix with the Canadian grain trade, other farmers who understand marketing and businesses that serve our industry. You’ll hear from marketing experts who make their living trading grain plus specialists from around the world with their own insights into how markets are working.

Do yourself a favour. Mark your calendar for two days in February at the Fairmont at the corner of Portage and Main.

Early-bird registration is $400 and includes all sessions and meals.

Register at wildoatsgrainworld.com or 1-800-567-5671.

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PRODUCTION

Western Grains Research Foundation is a farmer-funded and -directed non-profit organization investing in agricultural research that benefits western Canadian producers. For over 30 years the WGRF board has given producers a voice in agricultural research funding decisions. WGRF manages an Endowment Fund and the wheat and barley variety development checkoff funds, investing over $7 million annually into breeding and field crop research. WGRF brings the research spending power of all farmers in Western Canada together, maximizing the returns they see in crop research.

Without WGRF funds, research such as the Durum Wheat Plots at Kernen Crop Research Farm in Saskatoon would be limited.

Farm dollars make the difference Producer investment at Saskatchewan’s Crop Development Centre

By Brian Cross nother growing season is well underway at the University of Saskatchewan’s Crop Development Centre (CDC), thanks in large part to farmer investments furnished through the Western Grains Research Foundation (WGRF).

Wheat and barley breeders at Saskatchewan’s Crop Development Centre along with about 45 research technicians and field workers plant, maintain, monitor and harvest about 150,000 experimental lines of spring wheat, durum and barley as part of an ongoing effort to develop new and improved cereal varieties for western Canadian farmers.

Each year, the most promising experimental lines of wheat and barley are selected and carried forward for further development in hopes that they will one day become a registered seed variety in Canada.

Last year, the Western Grain Research Foundation invested over $1.4 million to the centre’s barley- and wheat-breeding programs in 2013.

In fact, the WGRF and the farmers it serves have been investing in the development of new wheat and barley varieties at the CDC since the early 1990s. This funding has helped facilitate the development of dozens of well-known cereal varieties, including CDC 56 country-guide.ca

Verona durum, CDC Utmost VB spring wheat, CDC Copeland malting barley and CDC Austenson barley, to name just a few.

Financial contributions made by the WGRF provide CDC wheat and barley plant-breeding programs with the stable, longterm funding that is needed to maintain successful programs and ensure that Canadian farmers have access to the latest and most promising cereal grain genetics.

“Developing new cereal varieties is a long-term process so we have material that’s moving through the program at different stages,” explains CDC barley breeder Aaron Beattie. “In a typical year, we’ll plant thousands of small plots… and then as the material moves forward into the yield trial stage of the program, we’re probably again talking about thousands of plots or even into the low tens of thousands.” According to Beattie, WGRF support has been critically important to the success of the CDC’s cereal-breeding programs.

Operating a breeding program is costly and extremely labour intensive. Managing data after the plots have been harvested is equally onerous. Financial assistance provided by the WGRF not only provides stable funding for core operations at the CDC, it also allows the centre to attract additional support from other organizations, including government and industry partners.

SEPTEMBER 2014

PRODUCTION “They (the WGRF) have a very good understanding of that long-term need for stability in a breeding program,” Beattie says. “That’s really the nice thing about our relationship with the WGRF, in that it gives us that stable funding that we need and it also allows us to leverage a lot of funding from other sources as well.”

Curtis Pozniak, who heads the CDC’s high-yielding wheatand durum-breeding program, agrees that funding stability is extremely important. “The WGRF is a fantastic supporter of the barley- and wheat-breeding programs here at CDC,” says Pozniak. “They provide what I think of as the foundation of funding for our breeding programs and that’s allowed us to leverage additional dollars from different levels of government as well as our industry partners.”

The foundation’s role also goes beyond funding for core breeding activities, Pozniak says. The WGRF provides feedback from the industry as well, serving as a direct link between CDC researchers on one hand and producers of Canadian cereal grains on the other. Feedback from the industry stakeholders — including farmers and end-users of western Canadian grain — is extremely important because it ensures that plant breeders are developing varieties that address the needs of growers and processors.

“That’s the other nice thing about our relationship with the WGRF. We meet on a yearly basis to discuss breeding targets,” Pozniak says. “The WGRF Board consists of producers from all across Western Canada who can provide input and guidance in

terms of setting breeding priorities, so that’s an important role that the WGRF plays beyond the funding.”

The WGRF also provides financial funding for additional projects that involve CDC researchers and that are considered beneficial to western Canadian cereal growers. Those projects involve research in areas such as plant pathology, gene sequencing and the development of new technologies that will allow plant breeders to develop new and improved cereal varieties more quickly and more efficiently.

In 2011, for example, the WGRF contributed more than $1.1 million to the Canadian Triticum Advancement Through Genomics project, or CTAG. CTAG is part of an ambitious international effort aimed at mapping the wheat genome and developing new molecular markers that can be used by wheat breeders to develop new varieties.

Producer investments in the development of new technologies will pay dividends immediately but in the long run, they will result in more new varieties and higher farm gate profits, says Kofi Agblor, managing director at the CDC. “For a farmers’ group to put money toward the sequencing of the wheat genome is a fairly progressive thing,” Agblor says.

“At the end of the day, our objective at the CDC is to deliver value to the farm and we are delivering value.

“For us, the relationship with the WGRF has been a very good agreement because it is stable and highly predictable and we can be assured that the funding will be there,” Agblor adds.

“For farmers, I think it has been a very good investment.” CG

Cultivating Growth Increasing Endowment Fund expenditures for the benefit of western Canadian crop producers

$15 million

in new funding to crop research over four years

More than

100 new projects

Research

priorities identified by producers

Leveraged to $30 million by co-funding

New research funding examples:

Weed Management

Blackleg & Clubroot in Canola

Improving Oat Nutrition

Pulse Disease Management

Graduate Student Scholarships

Fusarium Resistance in Cereals

WGRF is committed to utilizing the Endowment Fund for the benefit of western Canadian crop producers by managing and investing the fund in order to provide future long-term benefits to producers. To find out more, visit us online.

www.westerngrains.com WGRF Endowment Fund Half-page Ad_final.indd 1

2013-09-12 8:34 AM

Production

More value

from shelterbelts Even if ripping out an old shelterbelt could help you work more acres per hour, you may still be worse off

By Gord Leathers

Shelterbelts are contributing more than we guessed to high, sustainable crop yields.

ack in the Dirty ’30s, farmers planted shelterbelts in a desperate bid to slow those drying winds and keep them from blowing our precious topsoil east. Now, at almost 100 years old, these windbreaks have grown into stands of mature trees that continue to serve that purpose well.

Not only do these shelterbelts curb wind erosion, they also reduce evaporation and help trap snow that melts into the spring, adding soil moisture for that season’s crop.

The current generation of farmers, however, is looking at shelterbelts differently. Since conservation tillage is already holding the topsoil down and trapping the snow, why not remove the trees and put the otherwise unproductive land under crops?

This would also clear the way for machinery to run unfettered from one side of a section to the other, and make it easier for an aerial sprayer. Yet new thinking from the biological control people suggests there may still be good reasons to maintain those old tree belts.

“Shelterbelts and those kinds of perennial habitats around crops provide resources for beneficial insects,

58 country-guide.ca

including natural enemies and pollinators,” says University of Manitoba insect ecologist Alejandro Costamagna. “A lot of them can’t overwinter in fields that harbour summer crops because it’s just bare ground.

They need to overwinter in perennial habitats.”

The key word here is “perennial,” a permanent and stable refuge for insect predators during the off-season.

A field of wheat may be very productive for a short period and predatory insects may have a fine time in there for a few months. But it’s fleeting and, once the crop is in the bin, the remaining stubble provides almost nothing for the ground beetles and parasitoid wasps that hunt there. They need a local refuge where they can spend the winter and be ready to move into the fields the next spring. Otherwise they could die off.

On the other hand, native prairie offers a cornucopia of different plants that provide shelter, nectar and food year round. Although the populations of predator and prey insects may fluctuate, there’s an overall stability in the system. In this way the resident population of predators keeps a growing populace of plant-eating insects in check.

Those old shelterbelts are the last holdouts of stable habitats in a surrounding ocean of ephemeral crop fields, and research in other parts of the world suggests those groves are even more valuable than we know.

“There are some examples from Australia where they show that natural enemies from shelterbelts move into cotton,” Costamagna says. “They marked predatory beetles with rubidium and found that they move from these shelterbelts into the cotton and attack several pests.”

It’s a matter of timing. We’ve been farming for several thousand years and one of the first things we learned is how well pests can exploit a large stand of virtually identical plants. Under the best of circumstances, a crop gives them a limitless supply of high-quality food with no predatory enemies, so their populations can boom completely unchecked. On the other hand, if there’s a nearby pocket of generalist predators such as lady beetles, spiders and assassin bugs, the initial invasion doesn’t get the chance to boom and the numbers remain manageable. The predators may not eradicate them completely, but at least the pests are kept below the economic threshold. september 2014

production Costamagna says he found this in his graduate studies on soybean aphid. The aphid isn’t native here and it doesn’t survive the tough Canadian Prairie winter very well. Its numbers bump up in the spring however, when the southerly winds bring in a new supply from the United States.

Once here, the aphid can do a lot of damage if unchecked. “We didn’t think that natural enemies were effectively controlling these aphids, which are from Asia,” Costamagna says. “We assumed that natural enemies here couldn’t control this pest.”

But their studies actually showed that when you put the aphids in exclusion cages (a box that separated the aphids from predators) the aphid population took off and very quickly overwhelmed the system. Under natural conditions, aphids are very poor at escaping predators so they’re a ready source of food for many of the more voracious types. Their principal defence is rapid reproduction.

The exclusion cage experiments showed two things. The first was how quickly those aphid numbers increased when there were no natural enemies in there with them. The second was the difference in aphid populations in the surrounding environment. It turned out that the native predators were effective at controlling aphid numbers as long as they got an early start.

“These aphids had always had the potential to become a pest and really knock yield down. In any experiment we did in any season and in any field, if you excluded the predators, the aphids became a pest,” Costamagna says. “But most of the time we don’t actually see that, so we think these natural enemies are controlling these aphids.”

We don’t know the environmental cue that triggers the aphids to boom out of control, but having the predators in place and ready before the aphids blow in may be the critical factor for keeping them in check.

That’s what makes these perennial habitats so important. They provide that pocket of habitat where the predators can live until they’re called into the fields again. Nor is it only for overwintering. Shelterbelts are also providing some relief from the summer heat.

“Insects can’t regulate their temperature well so when it’s very warm, parasitoids will move into

wooded areas during the day and they will survive a lot better in there,” Costamagna says. “If you have areas like that near your crop, it’s more likely that you’ll have higher populations of these parasitoid wasps that can move when the conditions are better, find their prey and kill them.”

Now, more then ever, farmers are pulled in several different directions. They need productivity but they must also consider sustainability. If maintaining shelterbelts can provide both, then farmers can save time and inputs without hurting their profit margin. Those old shelterbelts can do this by providing a frontline defence against insect pests that requires no time investment.

Besides, those pests will never develop genetic resistance to predators. Still, these are not simple systems and we need to know a lot more about them.

“The first step is for farmers to understand that not all the insects are damaging, and I think the people working with farmers in that capacity are doing a good job on that,” Costamagna says. “And the second is before you spray, make sure that you actually have the pest you think you have, and that you have it in high enough numbers that it’s damaging.” CG

Shelterbelts were planted to save soil, but new science says they should be kept for crop health.

Trait Stewardship Responsibilities Notice to Farmers Monsanto Company is a member of Excellence Through Stewardship® (ETS). Monsanto products are commercialized in accordance with ETS Product Launch Stewardship Guidance, and in compliance with Monsanto’s Policy for Commercialization of Biotechnology-Derived Plant Products in Commodity Crops. Commercialized products have been approved for import into key export markets with functioning regulatory systems. Any crop or material produced from this product can only be exported to, or used, processed or sold in countries where all necessary regulatory approvals have been granted. It is a violation of national and international law to move material containing biotech traits across boundaries into nations where import is not permitted. Growers should talk to their grain handler or product purchaser to confirm their buying position for this product. Excellence Through Stewardship® is a registered trademark of Excellence Through Stewardship.

ALWAYS READ AND FOLLOW PESTICIDE LABEL DIRECTIONS. Roundup Ready® crops contain genes that confer tolerance to glyphosate, the active ingredient in Roundup® brand agricultural herbicides. Roundup® brand agricultural herbicides will kill crops that are not tolerant to glyphosate. Acceleron® seed treatment technology for canola contains the active ingredients difenoconazole, metalaxyl (M and S isomers), fludioxonil, and thiamethoxam. Acceleron® seed treatment technology for soybeans (fungicides only) is a combination of three separate individually registered products, which together contain the active ingredients fluxapyroxad, pyraclostrobin and metalaxyl. Acceleron® seed treatment technology for soybeans (fungicides and insecticide) is a combination of four separate individually registered products, which together contain the active ingredients fluxapyroxad, pyraclostrobin, metalaxyl and imidacloprid. Acceleron® seed treatment technology for corn (fungicides only) is a combination of three separate individually-registered products, which together contain the active ingredients metalaxyl, trifloxystrobin and ipconazole. Acceleron® seed treatment technology for corn (fungicides and insecticide) is a combination of four separate individually-registered products, which together contain the active ingredients metalaxyl, trifloxystrobin, ipconazole, and clothianidin. Acceleron® seed treatment technology for corn with Poncho®/VoTivo™ (fungicides, insecticide and nematicide) is a combination of five separate individually-registered products, which together contain the active ingredients metalaxyl, trifloxystrobin, ipconazole, clothianidin and Bacillus firmus strain I-5821. Acceleron®, Acceleron and Design®, DEKALB and Design®, DEKALB®, Genuity and Design®, Genuity®, RIB Complete and Design®, RIB Complete®, Roundup Ready 2 Technology and Design®, Roundup Ready 2 Yield®, Roundup Ready®, Roundup Transorb®, Roundup WeatherMAX®, Roundup®, SmartStax and Design®, SmartStax®, Transorb®, VT Double PRO® and VT Triple PRO® are trademarks of Monsanto Technology LLC. Used under license. LibertyLink® and the Water Droplet Design are trademarks of Bayer. Used under license. Herculex® is a registered trademark of Dow AgroSciences LLC. Used under license. Poncho® and Votivo™ are trademarks of Bayer. Used under license.

All other trademarks are the property of their respective owners.

september 2014

905.403.0055 > vic@urbanco.ca

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country-guide.ca 59

w e at h e r MILDER THAN NORMAL

C ai Fro oo n s l / s ty no w

R MILDER THAN NORMAL NEAR- TO BELOWAVERAGE PRECIPITATION

Warm Some rain

Co Sno ol Rai w n

NEAR-NORMAL TEMPERATURES AND PRECIPITATION

W Sto et spermy lls

NEAR NORMAL

m War ery w Sho ells p s BRITISH COLUMBIA

September 14 to October 18, 2014

Sept. 14-20: Warm on most days although some frost occurs at higher elevations and north on a couple of nights. Isolated shower or thundershower activity.

Sept. 21-27: Highs generally in the 20s except teens in coastal areas. Frost at higher levels. Scattered showers at a few localities.

Sept. 28-Oct. 4: Fair skies most of the week although scattered rain occurs and brisk winds on a couple of occasions.

Frost pockets inland.

Oct. 5-11: Fair on several days in the south with scattered rain. Unsettled in the north with coastal rain except some snow and frost in the mountains.

Oct. 12-18: Variable. Cooler outbreaks and blustery winds bring occasional rain on two or three days. Frost and occasional snow and frost inland.

ALBERTA Sept. 14-20: Several mild days although some lows fall to around zero on a couple of clear, cooler nights. Often dry apart from scattered showers.

Sept. 21-27: Highs reach the teens on most days with frost at many locations on two or three nights. Some rain, blustery on a couple of days.

Sept. 28-Oct. 4: Changeable and at times windy. Fair, mild days alternate with cooler days and occasional rain. Frosty on most nights.

Oct. 5-11: Variable weather and temperatures as disturbances move through. Scattered rain, chance of snow in the north and at higher elevations.

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Oct. 12-18: Cooler outbreaks and blustery winds bring occasional rain to the south and some rain or snow to the north.

SASKATCHEWAN Sept. 14-20: Although sunny, warm days dominate, rain falls on a couple of occasions. Frost in several areas on a couple of nights.

Sept. 21-27: Seasonal temperatures with highs in the teens and lows near zero on many nights. Sunny skies interchange with scattered rain.

Sept. 28-Oct. 4: Conditions vary as mild, fair days interchange with cooler air and occasional rain. Windy. Frosty on several nights.

Oct. 5-11: Fair with seasonal temperatures but cooler outbreaks on two or three days bring some rain, chance of snow in the north. Windy at times.

Oct. 12-18: Fair, dry weather alternates with wet, cool days. Blustery at times.

Cooler in the north with occasional rain and snow.

MANITOBA Sept. 14-20: Sunny, warm days will interchange with a few blustery, wet days and cooler temperatures. Several lows dip to around zero.

Sept. 21-27: Fair most days with highs often in the teens. Frosty on a couple of nights. Scattered rain in the south, possibly mixed with snow in the north.

Sept. 28-Oct. 4: Warm and seasonal days alternate with cooler, wet days. Windy at

times. Cool in the north with occasional rain, chance of wet snow.

Oct. 5-11: Cooler air advances south bringing some rain south, wet snow in the north on two or three days. Blustery. On fair days highs peak in the teens.

Oct. 12-18: Expect variable conditions as warm, dry days interchange with wet and cooler air. Windy at times. Snow likely in northern areas.

September 14 to October 18, 2014 NATIONAL HIGHLIGHTS Most of the country east of Alberta will see changeable weather conditions as shorter days and lower temperatures take hold, with several weeks mixed with warm and then cool, wet spells. Following earlier trends, by contrast, British Columbia and much of Alberta will see pleasant, dry and relatively mild days. Most of Canada will end up with near-normal temperatures and precipitation, although somewhat more unsettled conditions may affect Atlantic Canada in this period due to passing weather disturbances. Meantime in several far-northern locations, snow will make its first arrival in October. A developing El Ni単o is not expected to influence the Canadian weather pattern before late fall or perhaps early winter.

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.

September 2014

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LIFE

Too young, too old The generation gap is coming back with a vengeance, and farm families need to watch out

By Helen Lammers-Helps he concept called the “generation gap” might not have become a buzzphrase until the ’60s, but undoubtedly there have been generational differences as long as there has been history. So why should today be any different?

In fact, however, today may be exactly that — different. With the current speed of cultural and technological change, the generation gap may be wider and more damaging than ever.

Or, it could be wider and better than ever, depending on your perspective and your flexibility.

While we usually see these generational differences as a bad thing, that doesn’t have to be the case, asserts Jim Soldan, a farm business adviser in Chilliwack, BC. “Generational differences within the family farm can be hugely positive or hugely negative. It all depends on how you approach it,” says Soldan.

It helps to know what you’re looking for. Most important, what are the trigger points for intergenerational conflict? Uncertainty is a huge issue, points out Elaine Froese, a farm family coach in Boissevain, Man. and co-author of the book: Farming’s In-Law Factor — How to have more harmony and less conflict on family farms.

If there is clarity about expectations, agreement as to how things should unfold, and a commitment to act, there will be a lot less conflict, says Froese.

There are other stumbling blocks that Froese sees again and again on the farms where she’s been called in to help sort things out.

Sometimes, the founder’s inability to let go of the reins impedes the transfer of ownership to the younger generation, says Froese. After spending a lifetime building up the farm, the owner may be afraid to retire, she explains.

Unfortunately this leaves the younger generation hanging, wondering when they will get more responsibility and a chance to build up their equity.

Today’s young generation has been told essentially from birth that they need to get ahead, and if they don’t feel they are making progress, Froese says, they are going to go elsewhere.

“It can be very frustrating for young, educated people joining a farm team if their education, offfarm work experience or training isn’t recognized or valued by older members of the farm team,” Froese explains.

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The younger generation really wants to put their stamp on the farm operation, agrees Lynne Lancaster author of The M-Factor: How the Millennial Generation Is Rocking the Workplace. Too often the older generation’s response is to balk at change.

It would be more productive to listen to the younger generation’s ideas and try to find a way to incorporate some of them into the farm operation, she says.

Likewise, it can be equally frustrating for older family members when their kids come back to farm with them but don’t value the wisdom their elders have gained from years of farming, says Froese.

Young people may not even recognize how important this issue can become. Leaving a legacy is really important for the older generation, agrees Lancaster. She advises the younger generation to talk to the older generation about their vision and to really listen to them.

Sometimes the senior generation is slow to transfer ownership out of the fear that if the succeeding generation divorces, it will impact negatively on the farm. While it’s important to consult a lawyer to ensure that the proper legal paperwork is in place, Froese encourages families to focus instead on ways to help strengthen the marriages of farm owners.

This also applies to the marriage of the senior generation, which may also be at risk, she adds.

Other times, the senior generation may be waiting for the younger generation to marry, not recognizing a common-law relationship. “The senior generation has no choice but to express their ‘displeasure’ in the only way they know how,” says Soldan. “They are trying to protect family wealth as best as they know how.”

His advice to the younger generation in this situation is to have an attitude change. “With marriage, there is at least some confidence that the knot tied may be more difficult to untie than if the relationship is merely common law,” he says while also recognizing that formalized marriages come apart too.

Froese agrees that a wedding “speaks to the commitment in a relationship.” We have few norms or rituals for acknowledging common-law relationships, which can make it awkward for others, she continues. However, in her book, Froese quotes Gloria Call Horsley who uses the term “unofficial inlaws” to describe one’s relationship to the parents of one’s common-law partner.

September 2014

LIFE Another area of conflict that springs up regularly between the generations is work-life balance, says Froese. Younger generations want time for family and for personal renewal, she says. They may not be as willing to sacrifice their personal lives for the sake of the farm as the previous generations.

Lancaster agrees, but she adds that sometimes the older generation is too quick to judge the younger generation as lazy. The younger generation really wants to find a way to be more efficient so they can still have time for their families.

Lancaster believes it would be better for families to sit down and discuss their goals and answer the question, “Can we work smarter?”

Sometimes, too, the younger generation is perceived as being less loyal, hopping from job to job.

However, Candace Laing, a human resources professional in Saskatoon says that this generation has learned to manage their own careers because organizations no longer offer lifetime security.

“They have had to look for growth opportunities to develop their skills and ensure they are employable.” She continues, “Retention and loyalty are possible, they just likely won’t be sustained by nonexistent job security and pension but rather by purposeful work and engagement.”

Things may be different on the farm. But remember, these are your sons’ and daughters’ friends, and their attitudes help shape your children’s values.

Meanwhile, for the parents, it can be good to recognize your opportunities to build bridges. For instance, while generational differences often lead to conflict, technology is one area where the senior generation can take advantage of the expertise of the younger generation.

“They’re used to being our coaches,” says Lancaster. “They’ve been doing it since they were kids.”

And while the younger generation seems to think there’s an app to solve every problem, there may be places where technology really can improve the bottom line of the farm operation.

So, in a nutshell, what’s the secret when it comes to defusing generational conflict?

It’s communication, our experts all agree. Generational differences become a problem when there’s been a lack of dialogue, say Soldan. Each person on the farm team needs to share their needs, wants and where they’re coming from.

He recommends the farm family team meet regularly and develop a Code of Conduct that governs how team members will interact. For example, all members may agree to listen attentively, and that there will be no “eye rolling.” Team members should also maintain a positive attitude: “we’re in this together and we need to help each other.”

If every farm put the same energy into the farm team as they put into deciding what tractor to buy, farm businesses and farm families would be in much better shape, says Soldan. “People spend hours talking to the tractor salesman but not to other family members.”

September 2014

Froese agrees. Farmers are spending a lot of money on technology but are overlooking communication, she says.

Soldan advises farm families to seek professional help if needed. He uses a toothache analogy. “If you had a toothache you’d call a professional,” he points out. This is no different, he says.

Unfortunately, too often our response to conflict is to not have the difficult conversations. However, avoiding talking about the issues only makes the situation worse, stresses Froese. Problems do not go away by themselves. CG

How to shoot yourself in the foot when dealing with in-law conflict Eight Easy Steps (From Elaine Froese, farm family coach and coauthor of Farming’s In-Law Factor) Triangulate and Gossip: Refuse to speak to the person or persons you’re in conflict with. Instead, complain to everyone else in the community and expect the key parts of the message to be magically leaked to the key players. Expect at least half of the message to be lost or misconstrued in the transfer of information.

Stonewall: Refuse to deal with the problem and interfere with others’ attempts to do so. The simplest way to do this is to hang up the phone or get up and leave the room any time the topic is mentioned.

Try to control others and their actions. If persuasion doesn’t work, look to various oppressive dictators from around the world for other inspiring methods.

Be judgmental about everything they do or say. Nitpick at every little detail. Always attack the person, their actions, their ideas, their morals, their family, and even their choice of footwear and hairstyle, if need be.

Hold firm to your position, no matter what anyone else says, no matter how ridiculous your position is.

Complain incessantly about the situation, but do nothing to change it. Be insistent that it is ALL someone else’s fault and that you are a completely innocent bystander.

Hold a grudge. Forever. Even if it wasn’t a big deal. Slip references to the incident into conversation occasionally just to keep the wound fresh, but avoid having a serious conversation about what happened (see #2 Stonewall).

Insist that everyone in the family do everything your way or else pout, sulk, or throw child-like tantrums until they do.

country-guide.ca 63

h e a lt h

Warts — more than skin deep

By Marie Berry

f you’ve ever had a wart, you will know that they are embarrassing and inconvenient, but not usually harmful.

All warts are caused by viruses, specifically the human papillomaviruses. There are many different strains, and because these viruses are easily transmitted from person to person, childhood warts are a common result from contact when children play with each other.

Warts are also often transmitted in public spaces such as gyms, public showers, and the like.

Warts are skin lesions no larger than a half-centimetre in diameter. They can occur anywhere on the skin, but most often on the hands. They can also be flat or elevated, and they usually have a rough surface.

Applying tree sap under a full moon may not work, but what about duct tape?

The incubation period averages two to 18 months, so you may not even remember being exposed by the time that you notice the wart. About 50 per cent of people have “spontaneous cures” because the virus diminishes in numbers. However, recurrences are possible.

Few if any symptoms are associated with warts.

They can be esthetically unpleasant, however, and when warts are visible or occur in groups over extensive skin areas, you may curtail activities to avoid having people see them. Sometimes too, there can be tenderness, and if you scratch or “pick at” the wart, irritation can result.

Plantar warts affect the bottom of the feet. It is the pressure on the weight-bearing surfaces of the soles and/or heels that flattens them. The surface of the plantar wart may reveal multiple tiny black dots that tend to bleed when the surface is scraped. These warts can become large and cause pain, discomfort, and even affect mobility.

Non-prescription wart removers usually contain

keratolytics which remove keratin (the skin cells that comprise the wart). Because these ingredients can remove healthy skin, you will want to protect the skin surrounding the wart. Applying adhesive tape with a hole cut in it no larger than the wart will protect your healthy skin. Stick it on your skin before you apply the wart remover and leave it in place until the remover dries. Some keratolytic wart removers are available as medicated pads that you can position over the wart.

Unfortunately, it can take weeks or months with repeated applications to remove warts with keratolytics, and if you have numerous warts the process can be impractical. You may be tempted to “cut off” the wart, but you risk damaging your healthy skin and you also risk infection. However, you can soak the wart in warm water to soften it and rub the surface gently with a pumice stone to remove upper layers.

Freezing the wart with liquid nitrogen can be done by a health-care professional, but there also is a nonprescription product that you can use on your own to freeze warts. Having a health-care professional do this might be the better option, because if you miss the wart you risk damaging your healthy skin. Scarring and infection are potential complications.

Other approaches include surgical removal and laser therapy, both by health-care professionals.

Regardless of your treatment, repeated therapy is usually needed over three to four months, and wart recurrence is possible.

Numerous traditional methods exist for wart removal and range from procedures done at a full moon to application of specific types of tree sap, but using duct tape does seem to help. Soak and remove any dead skin, then apply a piece of duct tape slightly larger than the wart. It needs to be kept in place for about six days, then the process is repeated again for about a month.

And you thought duct tape was only for repairs!

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

Gout is sometimes considered an “old” disease because it has been around for centuries. However, if you do have gout you will know that it can certainly be problematic. Next issue, we’ll look at gout and its treatment.

64 country-guide.ca

September 2014

NOW AVAILABLE Brilliant-red poppies sway in a breeze that blows gently inland from the English Channel, and a three-wire fence separates the cemetery from a neighbouring field of canola.

The poppies contrast with the cemetery lawn, where every blade of grass has been manicured. These are no ordinary poppies, and this is not an ordinary cemetery. Canadian symbols are everywhere but those buried here are far from their Canadian birthplaces. A monument proclaims this ground has been given to Canada by France, which remembers the sacrifice of our sailors, soldiers and airmen in liberating their country from the Nazi grip of the Second World War. The commemoration of the 70th anniversary of D-Day on June 6 attracted world leaders to the Normandy beaches.

My prayer is that their appeals for peace will be honoured.

Two weeks later my wife Jacqueline and I visited the area.

The Canadian War Cemetery at Beny-sur-Mer was peaceful and tranquil. Photos and TV documentaries pay tribute to the final resting place of the war dead but I was not prepared for the surge of emotion that overcame me. Rows and rows of perfectly arranged graves pay tribute to the 2,048 men buried here. Their ages and hometowns are marked on the stones.

They were young and a long way from home. Their families in Canada never saw them again.

I had two poppies in my pocket. Jacqueline placed one near a headstone for a soldier named Phillipe Plante, her paternal family name. I placed mine on a stone marking the grave of “Rifleman George Kindrachuk of the Regina Rifles killed 9 June 1944 Age 25, son of Alex and Paraska Kindrachuk of Hafford Saskatchewan.” I cannot imagine what sadness must have engulfed the Kindrachuk family and their town northwest of Saskatoon.

Earlier in the day we visited the War Cemetery at Ranville, the first village liberated in France. A headstone with the name Harry Andrews caught my attention. Could he have been a relative? He belonged to a British Regiment and died in 1944 at the age of 22. The symbol on his headstone was the Star of David indicating his Jewish faith. The engraving said “Formerly Hans Arenstein born in Erfurt, Germany.” A similarly marked headstone at Beny-sur-Mer for Corporal Israel Pavelow noted he served as Ervin Povol with the Regina Rifles. He was born in Kiev, Russia, son of Hyman Pavelow. What anguish and fear dominated the lives of these men before their untimely deaths?

The cause was so important they changed their names and hid their religion. Unfortunately, the battle for religious and political freedom is still going on in many parts of the world.

Sometimes I reflect on the connections between my life and what happened on the Normandy beaches. The people who were significant in my formation were deeply affected by the war. They were the people who guided my education and formed my attitudes and values. They passed on standards and principles which have guided my life.

We arrived home shortly before July 1. Canadian flags were flying everywhere. My mind went back to Juno Beach where I said a prayer of thanks and I gathered some sand. It will remind me that the freedom and opportunity I have enjoyed, and continue to enjoy, came at a huge cost.

Suggested Scripture: Micah 4:1-5, Luke 1:67-79

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Rod Andrews is a retired Anglican bishop. He lives in Saskatoon. ©2013 Farm Business Communications

September 2014

country-guide.ca 65

ACRES

By Leeann Minogue

Who’s that behind the wheel?

“Nobody better tell Grandpa about this.” onna had done her best to pass her position on the farm to her daughterin-law gracefully. First, she’d passed on her role as bookkeeper to Elaine, going so far as to move the filing cabinet from the spot in Donna and Dale’s house where it had permanently crushed the carpet to Elaine and Jeff’s new house across the yard.

Then Donna had passed on her role as coffee coordinator, making sure that her husband Dale and son Jeff took breaks in Elaine’s house, rather than sitting in their usual chairs around Donna’s dining room table.

Donna resisted the urge to pass on her muffin tins and recipes. “Only the worst of meddling mother-in-laws would complain about store-bought cookies now and then.”

At first, Donna made the most of her new-found free time. She took up with a whole group of newly retired women. For the first time since her kids were born, Donna could actually go along when she was invited to coffee get-togethers. These progressed to shopping days in the city and soon Donna had become part of a group of women who went on hiking and ski trips.

She’d been having such a good time, she didn’t really notice how much she’d been away from the farm until one evening in late July.

“Want to come along on a crop tour?” Dale had asked.

“Sorry, I can’t. I promised Jen I’d meet her at the lake to help her practice with her kayak before our river trip.”

66 country-guide.ca

“River trip?” Dale said. “I didn’t know you were going on a river trip. That’s too bad. You really should see these soybeans. They look great.”

“Soybeans! You planted soybeans?” Donna said.

Donna had meant to pass on her role to give Elaine a chance to get involved in the farm. She hadn’t meant to get so far removed from the operation that she didn’t even know what they had in the ground.

That very night, she’d called Jen to reschedule so she could go out with Dale and look at the crops.

“This is really nice,” Donna said, grateful that she’d taken time to spend the evening with her husband.

“Sure is! Best canola crop I’ve seen here in years!” Dale answered. Then he laughed. “I’m just kidding. I’m glad to spend some time out here with you too. We need to find more for you to do around here.”

But what? She couldn’t take back the jobs she’d given up.

An answer came during harvest.

“I can’t be out in this field all day,” Donna’s father-in-law Ed announced to his surprised son and grandson one morning, not long before lunch. “I have important phone calls to make. I don’t have a whole day for this project. I’ll get my business done and come back later.” Dale and Jeff were stunned.

But when they saw Ed limping heavily between the combine cab and the truck, they understood the real reason Ed needed a break, and also why he was so miserable about it. He was exhausted, and in pain.

SEPTEMBER 2014

acres

“Guess we worked Grandpa too long yesterday,” Jeff said.

“That hip must be giving him more trouble than he wants us to know,” Dale said. “We should have figured that out sooner.”

“We still wouldn’t have got him out of the cab before he was ready. Not without the Jaws of Life,” Jeff half-joked. “But now what do we do?”

Not wanting to offend Ed by implying that he wasn’t up to a full-time job, Dale and Jeff hadn’t tried very hard to find someone to work on the farm. One of the neighbours had promised to help out the year before, but when he’d sprained his ankle on the first day, he’d never come back. Other years, Elaine had put in some time helping during harvest, but with a fouryear old and a new baby, that wasn’t a great option.

With Dale swathing canola and Jeff running the grain cart and moving augers, they were stuck for someone to run the combine. Dale and Jeff put their heads together and called a few potential prospects, but they came up empty. Eventually Dale phoned home. “Donna, you’ve been spending time in town.

Do you know someone who could help out?”

“Let me give it some thought,” she’d said.

But instead of thinking about it, Donna had changed her clothes, packed a lunch and headed out to the field. And that’s how she became the Hanson’s fill-in combine operator.

Dale and Jeff weren’t convinced at first.

“You don’t even like driving my one-ton truck!”

Dale had said.

“You know there’s a lot of computers in a combine cab, right Mom?” Jeff asked.

It wasn’t something she’d done before. She had always been run off her feet with kids, meals and paperwork. But after challenging herself on snowshoes, in a kayak, with a photography class and even on a snowboard over the past two years, Donna was sure she was up to it.

“I’ve been running a computer since you went off to kindergarten,” she told her son. “Now step aside and let me into that cab.”

She had most of the controls figured out by lunchtime and was getting used to listening to the sound of the rotors. By one o’clock, she’d mastered the yield monitor and was even managing not to plug the combine when she was picking up the large awkward piles of canola the swather had left behind in spots around the field.

September 2014

With Dale swathing canola and Jeff running the grain cart and moving augers, they were stuck for someone to run the combine. They put their heads together, but eventually Dale phoned home.“Donna?”

“We’ll have to get your dad to quit leaving beaver huts all over the field if he’s going to get good help!” she told Jeff.

By two o’clock, Donna had already taught herself how to run the satellite radio, and Jeff left her alone in the cab so he could haul canola to the bins.

At four-thirty, Donna was unloading canola on the go, something Ed had never been comfortable doing.

“Nobody better tell Grandpa about this,” Jeff said.

But it was too late.

A well-rested Ed had just driven out from town.

He pulled up at the approach to the field where Dale and Jeff were standing outside, watching Donna turn at the end of a swath with finesse.

“Is that Donna in that cab?” Ed asked?

“Sure is,” Dale said, surprised at how proud he felt.

“She’s doing pretty well,” Jeff added, genuinely impressed.

“Huh,” Ed said. “Step out of you chair for 10 minutes and look what happens.”

Jeff and Dale exchanged looks. Would Ed be so offended he’d drive off into the sunset with his new girlfriend, and refuse to help at all? Even with Donna on board, could they get by without Ed? Then Ed’s cell phone rang.

“Yep… Yep… I thought that would happen,” Ed said into the phone. “Same time tomorrow would work good. I’ll catch you at this end.” He put his phone back in his pocket.

“Women. Donna wants to go out boating with some girlfriend or some darn thing. Guess I have to get back to work.”

With that, Ed got in his truck and drove to the edge of the field, to wait for his turn. CG Leeann Minogue is the editor of Grainews, a playwright and part of a family grain farm in southeastern Saskatchewan.

country-guide.ca 67

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