The Seven Deadly(ish) Sins of Grain Marketing Explained

Emily Mailhot

Reporter – Vegreville News Advertiser

Brian Voth’s “Seven Deadly(ish) Grain Sins and How to Avoid Them” presentation, hosted by the local Farm Credit Canada branch, filled a boardroom to overflowing at the Pomeroy Inn and Suites in Vegreville on Wednesday, January 23.

While Voth admitted early on that the topic of his profession – Grain Market Advising – is one of the “snoozers” that fall low on most farmer’s priority lists at seminars, Agriculture Trade Fairs, and like-events, his unique approach kept the Vegreville-and-area audience engaged throughout the morning.

Paralleling the canonical 7 Deadly Sins – lust, gluttony, greed, sloth, wrath, envy, and pride – Voth’s tips to avoid big mistakes in marketing grain were backed by examples of attitudes he had seen in his home area of southern Manitoba, and where those attitudes led.

• Lust; or, a perpetual longing for the high of the market, especially when compared to last year’s market. Every crop year should be approached independently, no matter what last year’s market looked like.

• Gluttony; or, wanting more than needed for your target ROI. Once you hit your projected or actual ROI, you should be selling to reduce price risk and lock in your profits.

• Greed; or, wanting the best price, but not looking at profitability. As Voth had observed “greed” as one of the biggest farm marketing vices, he warned that wanting more, and waiting for the market to keep on rising, could lead you waiting just for the market to drop.

• Sloth; or, being a lazy marketer. In the long run, a proactive, disciplined marketing plan will always pay off compared to not having a plan and being reactive. Without a plan, many farmers fall into a default of sitting on their crops whether the market is high or low and don’t sell until they need the binspace for the next crop. No matter what the market looks like, a plan should be in place to ensure your farm is profitable.

• Wrath; or, being angry about your market decisions. Once a marketing decision has been made, it’s important to carry on and focus on what you have left to sell. In Voth’s words, “Don’t berate yourself if prices go higher… celebrate that whatever’s left, you can sell for more.

• Envy; or, coveting what you hear from your neighbours. Voth mainly focused this point on the nature of “coffee-shop talk,” much like fishermen’s tales, to inflate the truth and lower self-esteem when it comes to your own farm, the equipment you have, and the prices you’ve gotten for your grain. Every farm is different, no two situations are the same… just do your best to make sure your farm is profitable and move on.

• Pride; or, thinking you have to do everything yourself. Your farm is a commodity-based investment business. There is no harm in outsourcing the tasks you can’t or don’t like to do and focus on your strengths. After the “7 Deadlies” portion of the presentation, Voth also explained the pros and cons of futures and options hedges.

Conrad Bielesch, an attendee who farms canola, wheat, peas, and soybeans north of Mannville, said that he and his father had attended to grow a little more in their marketing skills. “You can always learn a little more,” said Bielesch, “It’s what you do at home to apply what you’ve learned that counts.”

The group took an intermission for coffee and snacks halfway through the presentation. Before heading home for the afternoon, the presentation’s students were also offered an information session about farm insurance, by Gail Schafer of Global Ag Risk Solutions.