But the skyrocketing price of fertilizer, fuel, herbicides and other inputs isn’t the only worry. Lately it’s often been about getting your hands on products you’ve paid an arm and a leg for.

Clint Jacula thought he had the bases covered. He ordered his chemicals in November, much earlier than usual, and kept checking on the status of his order.

It wasn’t enough.

“Two weeks before we start spraying, I get a phone call that we’re not going to have this stuff,” said the grain and cattle producer who farms north of Vermilion, Alta.

By that measure, Brent Konstapel can count himself somewhat lucky, although the last-minute delivery raised his stress level.

“The chemical showed up a week ago, and we ordered it this winter,” the grain farmer from the Spirit River, Alta. area said June 28. “We were rushing to get it sprayed here in the last week.”

There’s also been stress when looking at expense accounts. Magrath, Alta. area grain farmer Sean Stanford said nitrogen prices were almost triple what they were a year ago.

“That was a big shock, that one,” said Stanford, adding that come spring, prices of herbicides started taking off, too. “It was at least 50 per cent up on everything from glyphosate to in-crop products. That one hurt as well.”

“I don’t think it’s doubled, but the costs are higher for the glyphosates — Roundup and Liberty has really gone up,” added Jacula.

And while grain and oilseed prices are still high, they’re starting to slip.

“We’re crunching numbers here and we’re over double on our nitrogen and phosphate fertilizer over what we paid last year,” said Konstapel.

Jacula said farmers know the cost of nitrogen fertilizer is directly tied to natural gas prices but the speed of the price increase caught everyone off guard.

“Our prices are more than double what they were and what we usually expect,” he said.

The sharp rise in the price of grains and oilseeds had many producers dreaming of a great year following last year’s drought. But with the cost of putting in this year’s crop, producers now need commodity prices to stay high, said Konstapel.

“We’re not getting the prices we need. Grain prices need to stay up if we have to pay these high input costs as well.”

And it’s not as though there was much that farmers could have done to reduce costs, said Jacula.

“We can choose to use less, but we need these products and you need to put these on.”

The anxious times aren’t over. As harvest time creeps closer, many are worried about equipment parts or previously ordered machines.

“Parts are really expensive if you can even find them,” said Stanford.

Buying new or used farm equipment is difficult, too.

“There’s a shortage right now,” he said. “The dealers can basically charge whatever they want because people are at their mercy. If you need a piece of equipment, there are no options and you basically have to pay it (the asking price).”

Anything that comes on the market is quickly snapped up, Stanford added.

“It’s a supply-and-demand thing. If demand is high, people can crank up the price and do whatever they want with it.”

Equipment horror stories are increasingly common.

“A neighbour was dealing with an equipment purchase, but it didn’t show up for seeding, and they had already sold their old equipment, and they had to find something else because the new one didn’t arrive on time,” said Konstapel

“We’re hearing the same thing for the fall. Combines and new headers are not showing up on time, so (farmers who) have already sold or traded their previous units will have to find something to take it off.”

Jacula knows people in the same situation.

“Neighbours ordered equipment that never even came this spring,” he said. “They sold their (old) equipment and the dealers were trying to rent stuff back. How can you charge someone for something they didn’t get? It’s crazy.”

His advice is simple: “Farmers, don’t let your used equipment go until all the new stuff is in the yard.”

And expect the unexpected — or even the bizarre — when you call parts suppliers.

“We had a tractor this spring that blew a back tire,” said Jacula. When he phoned around, he was told it would take a couple months to get a new tire.

“You can’t have a tractor standing for a couple months,” said Jacula, adding he was eventually able to track down a replacement.

“I don’t know how many phone calls and how much time we spent just trying to get a tire,” he said. “We didn’t really have a (selection) choice. We just took whatever he had.”

Jacula said he isn’t sure whether companies aren’t carrying as much inventory as usual or whether supply chain disruptions are to blame. Either way, it’s stressful.

“You just can’t wait. We’re on a time deadline,” he said. “You have to have everything in the ground so fast and by a certain date.”

He’s not expecting a return to the old days, at least when it comes to a lot of prices.

“Parts have gone up a lot. Labour has gone up a lot. If you get anything worked on, shop rates have gone up.

“It’s a direct reflection of daily costs — your power, heating bills, and all those things have gone up for everybody. Everybody is fighting them.”

The post STICKER SHOCK: Plant 2022 has been unlike any other, say farmers appeared first on Manitoba Co-operator.

Following a year of bumper grain crops, feed costs have declined — resulting in a five-cent reduction in the producer price of eggs in Manitoba.

“The cost of production is updated as input costs change, it could be monthly, or quarterly or yearly… but in my recent memory, I don’t think we’ve had a reduction,” said Cory Rybuck, general manager of Manitoba Egg Farmers.

But while Manitoba producers will be paid a nickel less — the new price is an even $2 per dozen — it’s difficult to predict if the retail price of eggs will follow suit.

The Manitoba Co-operator contacted Safeway, Sobeys and Loblaws to ask if that nickel will be passed on to consumers, only Loblaws responded — and it directed the reporter to the Retail Council of Canada.

“In our experience, retailers always try to pass along savings to consumers,” said Sharon Armstrong, the council’s senior vice-president of marketing and communications. “Retailers operate in a very competitive environment and want to be as attractive as possible to potential customers.”

However, Armstrong adds that it’s important to note that the cost of goods is only one element of pricing. Other variations, including transportation costs, business expenses and handling costs can also impact pricing, she said.

It’s the same situation in neighbouring Ontario, where prices are falling by six cents.

“The six-cent price reduction will not necessarily trigger an equivalent decline in retail prices since the price of eggs in supermarkets is not set by farmers,” reads a press release from the Egg Farmers of Ontario.

However, the association’s general manager notes grocery chains frequently use eggs as “loss leaders” to compete with other retailers.

“The fair farm price reduction of six cents means there is six cents in cost removed from the marketing chain,” said Harry Pelissero. “This will result in some combination of lower prices or higher margins equal to six cents depending on decisions taken by the other players in the marketing chain.”

Rybuck said what’s important from the producer perspective, is ensuring that the price of production remains in line with the producer price as inputs fluctuate.

“As the cost to produce a dozen eggs goes up or down, we adjust the producer price accordingly,” he said.

The post Producer price per dozen dips as feed costs shrink appeared first on Manitoba Co-operator.

Smaller numbers helped to keep prices propped up, while a pickup in demand from local buyers was responsible for some prices moving higher.

Scott Anderson, with Winnipeg Livestock Sales, said the demand seemed to be there, though the front row, where the buyers sit, was thinner than usual.

Fewer people were out purchasing cattle because there aren’t as many cattle up for sale, making it difficult to make up big loads.

“It’s very tough to make loads work now, kind of like pulling teeth a little bit,” said Anderson.

A good number of local buyers were out during the week, though not many grass cattle were bought locally because most producers are done buying and have them all out on pasture already.

There were also some buyers from the East and elsewhere in the West, Anderson said, noting “a lot of cattle went west, some went east; it seemed like it was kind of an even split.”

There were some earlier concerns eastern demand would slow down because of expensive transportation costs, but Anderson said they’re still buying cattle from Manitoba.

“I think some of the trucking rates are lower now because guys will take whatever they can get; it’s not like they’re getting lots of phone calls for cattle,” he said. “I think some of the (eastbound) trucks will just take whatever they can get, even if it means going home with half a load.”

The number of feeder cattle that came onto the market was steady compared to the week prior, with most of Manitoba’s auction yards showing slightly lower numbers — but the amount seen at the sale in Winnipeg exceeded expectations, Anderson said.

“We ended up with just over 500 cattle, which was about double what we thought we would get,” he said.

Slaughter cattle numbers were strong during the week, Anderson said, adding that Winnipeg saw about 250 butcher cows. Other auction yards also reported good slaughter numbers.

Of the cattle that came onto the market, most sold for steady to stronger prices compared to the week prior amid good demand.

Anderson noted the slaughter market was up about $1-$2 per hundredweight compared to recent prices.

Prices on both sides of the market, feeder and slaughter, are expected to stay steady throughout the summer as little movement is expected with only a handful of auction marts holding sales. (See the schedule table for full details.) But there’s some optimism that prices will start to see some recovery heading into the fall.

“It seems like maybe the yearlings are going to be all right — nothing to say it’s going to be a disaster,” Anderson said. “If feed prices come down a little bit and if there’s not quite as many cattle around, that should help keep the price up.”

The post Weekly cattle auction report appeared first on Manitoba Co-operator.

“It wasn’t fair market value and I didn’t consider what was on that piece of paper to be an offer at all,” said the retired rancher. “It was insulting.”

The offer violated the terms of the Shoal Lakes Agricultural Flooding Assistance Program because it wasn’t based on the fair market value of his property, said McCulley. Instead officials used Farm Use Assessment value, which has traditionally been used when assessing taxes on farmed land located close to urban centres, he said.

The property assessment he received from the GO office in Teulon during buyout negotiations shows there were two assessments done — one at market value and one using the much lower farm-use value.

Offering the lower value showed “they just had no respect for us,” McCulley said.

It took months before he finally received an offer that reflected the market value of his property and what he said was an apology from an official with Manitoba Agriculture, Food and Rural Initiatives. He accepted both, but said he wonders how many other Shoal Lake producers were treated the way he was.

Orval Proctor is wondering as well.

The cow-calf operator said he believes he was also offered the farm-use value for his land instead of market value, but is having difficulty proving that because he wasn’t provided with a copy of his assessment.

“He pushed it across in front of me with his finger on it, and I just got to glance at a couple of pages and see that it was signed by the appraisers,” said Proctor. “But as far as what it said, I couldn’t pick it up and leaf through it and I never got to take a copy home.”

Other flooded-out landowners also say they weren’t given the chance to fully examine or keep copies of their property appraisals. McCulley said it was only luck, and some quick thinking, that allowed him to photocopy his assessment.

Proctor said he believes a closer look at his assessment might reveal why he was offered $99,000 for two half sections. A private appraisal of nearby land sales put the market value of his two half sections — prior to flooding — at $305,000.

“They presented all the offers as if they were fair market value,” he said. “They weren’t.”

Proctor has appealed the province’s assessment to the Land Values Appraisal Commission, and expects a decision soon.

The program uses fair market values, said GO Teams director Gerald Huebner.

“I’m not an appraisal professional so I have to be careful in commenting on that,” he said. “There was some adjustment made in some files and this was only a very small part of a few files where there was a judgment to what its agricultural value was versus its value for other purposes.”

When asked why someone might receive an offer based on farm-use rather than market value, Huebner said he couldn’t comment on individual offers, but added the program is a voluntary one.

‘Voluntary’ is a word both Proctor and McCulley heard many times, including by a Crown lawyer during Proctor’s Land Values Appraisal Commission’s appeal hearing.

McCulley said it indicates a like-it-or-lump-it attitude that has left many farmers feeling bullied and without recourse. He noted his purchase offer also stated that should an applicant appeal an assessment and receive a higher value, the government has the right to revoke its offer.

But Huebner said regardless of the “legal wording” in the offers, the province has publicly stated it will accept decisions where an appeal garnered a higher value and has not revoked any offers because of a successful appeal for a higher appraisal.

That’s typical of the kind of confusing information flooded producers have to deal with, McCulley said. In addition, Proctor said staff at the Teulon GO office, where most offers were made, warned him not to share information or discuss his offer with friends and neighbours.

“It might have been a caution, it’s certainly not an instruction or prohibition,” said Huebner.

But Proctor said he wonders whether the rising costs for the Shoal Lakes Agricultural Flooding Assistance Program prompted officials to push for settlements below fair market value. The cost of the 46 buyouts covering 30,599 acres is approaching $13 million, with five cases yet to be settled. A 2010 estimate pegged the total cost of buying flood-prone land around the Shoal Lakes at $11.4 million. (An additional $5.26 million has been paid out to producers for income loss and transportation costs.)

A frustrated Proctor said he doesn’t know what he will do if the appeal board rules against him, noting he is too young for retirement and still has a young family.

“Right now we just have to wait and see,” he said.

The post Shoal Lake: Flooded landowners slam province’s buyout tactics appeared first on Manitoba Co-operator.

“We’re not going to make it,” he says as he begins an interview. In fact, the number of hungry people in the world today is between 800 million and 900 million, depending on how you measure it, which is about the same as it was in 2000 when global world leaders made their commitment.

Granted, the world’s total population has increased by more than a billion since then, so the percentage of hungry has dropped. But Rojas says the commitment wasn’t to reduce the percentage, it was to reduce the number of hungry people.

“What is important is the number,” says the Chilean-born economist who has devoted much of his life to humanitarian development. “Percentages only mask inequality.”

What’s frustrating for people who spend their lives doing this kind of work is that there is no shortage of food. Despite the bombardment of messages that the world’s farmers must increase production by up to 70 per cent to feed what is expected to be a population of nine billion people by 2050, Rojas says the key issue is access to nutrition — and that’s a function of priorities, not production.

“What I see as the major challenge is today most of the food-insecure people are living in middle-income countries, and middle-income countries are not the priority for the international community,” he says. International food donors such as Canada focus their efforts on the lesser-developed countries or regions of the world in which food insecurity is created by environmental disaster, political instability or military conflict.

He noted food production in India has increased fourfold since the Green Revolution and it is now an exporting country. Yet it is home to one of the highest per capita rates of malnourished children.

Rojas said the global community has realized that child nutrition is key to a country’s economic growth, but that realization has not yet translated into policies that consider the elimination of malnourishment as an investment, rather than a cost.

Cognitive ability, a human being’s intellectual potential, is determined within the first few years of a child’s life. Poor nutrition at that stage has lifelong consequences, not only for individuals, but for a nation’s economic growth, he said. That affects the global community too.

In Guatemala, for example, where 53 per cent of the population suffers from chronic malnutrition, the GDP is reduced by 13 per cent. That translates to losses in economic terms of about $6 million a year. “With a fraction of that we could solve the problem of hunger,” Rojas says.

Progress is being made, however.

Rojas speaks highly of the decision by Canada, the EU and several other international donors to “untie” their aid and move towards stable, long-term funding for the WFP. Canada has pledged to provide a minimum annual commitment of $250 million in food assistance.

That shift, which has been solidified in the newly ratified World Food Aid Convention, increases the agency’s flexibility in its programs and its procurement strategies.

Last year, the WFP purchased more than two million tonnes of food worth $1.1 billion. Eighty-six per cent of that was sourced in developing countries, a strategy that not only supports local economies and smallholder farmers, but reduces transportation costs and the time it takes to get the food mobilized.

An analysis of the WFP’s Ethiopian program in 2010 found that local purchasing saved $40 million, which is the equivalent of feeding 250,000 people for a year.

The lead time required to get food into place during a crisis has been reduced by up to 62 days.

Of course, Canada’s move to untied aid in 2008 had an impact on this country’s farmers. The WFP procurement from Canadian suppliers has dropped significantly. Last year, 10,000 tonnes of peas and lentils worth about $6.5 million were purchased from Canada. The program’s deputy director of procurement Mary-Ellen McGroarty says future purchases from Canada are most likely to be in the form of nutritionally dense processed foods.

But to their credit, most Canadian farm groups supported Canada’s leadership in untying its food aid contributions. In reality, there isn’t much of an economic future in supplying food aid to the chronically poor. The future for Canadian export agriculture lies in marketing to emerging economies, where an increasingly wealthy population seeks to expand nutritional choices.

Those economies, those opportunities, won’t develop for as long as children are going hungry.

The post Investing in the future appeared first on Manitoba Co-operator.

Producers have hurried their animals to market at a record pace and, coupled with the normal seasonal buildup in hog slaughters, that could result in tighter supplies in 2013.

The USDA says end-of-October pork stocks hit 606.2 million pounds, down four per cent from September, but up 24 per cent from last year.

Cargill outsources transportation

reuters — Cargill says it will hire an outside company to handle transportation of the beef it produces at Guelph, one of its two big Canadian beef-packing plants.

The decision will help Cargill deal with escalating transportation costs in the highly competitive eastern Canadian retail market, the company said in a statement.

About 50 unionized and non-union employees will lose their jobs as a result.

The change does not affect Cargill’s beef plant at High River, Alta., which competes with the XL Foods plant at Brooks.

The post U.S. pork stocks rise to a record high appeared first on Manitoba Co-operator.

There’s an abundance of cheap natural gas across the country, and new extraction technology is adding to the surplus here and abroad, he said.

“We have no end to natural gas,” Devine said at the recent Farming for Profit conference.

Plunging prices mean compressed natural gas costs half as much as petroleum to power vehicles and produces 30 per cent fewer emissions, he said.

Switching to natural gas on the farm will make food cheaper to produce and doing the same for transportation will lower export costs, he said.

The main roadblock to using compressed natural gas is access to it, Devine said. Natural gas filling stations, which use large compressors to ensure natural gas refuelling times are similar to those for gasoline, are relatively rare, he noted. Moreover, fuel providers are reluctant to build more until there are more vehicles powered on natural gas, while companies and consumers are reluctant to buy natural gas-powered engines until there are more filling stations.

The alternative is “return to base” fuelling, which allows for slower, overnight filling, and many truckers, rural municipalities, and other heavy-equipment operators are considering doing just that, said Devine. That’s an option for farms with natural gas service, which is the case in much of Alberta and Saskatchewan, he noted.

Overall, the trend towards natural gas is building, he said.

Equipment manufacturers, including Cat, Volvo and Cummins, are building engines that burn natural gas, some natural gas filling stations are being built in B.C. and Washingto, and Shell is planning to build stations in Red Deer and Medicine Hat, said Devine. There’s also talk of stations along the Trans-Canada Highway as far east as Winnipeg, he said.

According to Wikipedia, there were 14.8 million natural gas vehicles in the world in 2011, with Iran, Pakistan, Argentina, Brazil, and India all having from one million to three million such vehicles on the road.

Lowering production and transportation costs would significantly boost food security, said Devine.

The post Natural gas, natural solution: Devine appeared first on Manitoba Co-operator.

The Tyrchniewicz report found that the Manitoba and Saskatchewan forage industry has sufficient quality and quantities of forage for export markets, the spotty availability of up-to-date market intelligence and a lack of compressing, pelleting and cubing facilities hinders the export trade.

Portage la Prairie and Saskatoon could be ideal locations for future compressing operations, it added.

Markets in the Middle East and Asia are keen on Canadian forage exports, but the report cautions that unless significant savings in transportation costs are found, only those markets looking for the highest-quality forages should be pursued.

High transportation costs effectively price eastern Prairie forage products out of commodity-type markets. Darren Chapman, of Chapman Farms near Virden, who ships hay regularly to buyers in the United States by truck, echoed that sentiment.

“The growing interest in hay imports from countries such as Saudi Arabia, United Arab Emirates, Japan and China is a welcome development, but only if we can get it there in a cost-effective manner,” said Chapman.

The Manitoba and Saskatchewan Forage Councils are planning to continue working together on potential export opportunities for Prairie forage growers.

Manitoba forage marketers are working on a proposal for Western Economic Diversification Canada that will address high transportation costs by compacting forage, thus lowering transportation costs and improving price competitiveness in world markets.

Although Churchill isn’t an option for now, the study also identifies a number of rail system options to help reduce transportation costs, including out of Minot via the Burlington Northern. The potential there lies with Minot possibly doubling the size of containers it ships, from 20 to 40 feet. If that happened, it will become a cheaper route to move forages on to seaport, says Brent McCannell of the Manitoba Forage Council.

“Ultimately, this comes down to containers and the cost of getting access to containers,” he said, adding that MFC will be watching closely to see what develops at Minot.

The MFC is also talking to Centre Port in Winnipeg and is buoyed by its recent success handling logistics for a soybean sale to China.

There are also ways to reduce transportation costs by shipping more forage per container. Lack of processing is a big part of Prairie forage growers’ struggles of higher freight costs.

The Manitoba Forage Marketers are working on a proposal for Western Economic Diversification Canada to address high transportation costs by possibly purchasing a compressor to reduce standard-size large square bales into smaller packages, McCannell said.

“To be competitive we need to get more forages in a container and if we compress it we can do that.”

The post Hay is here, markets are there appeared first on Manitoba Co-operator.

Alberta cattle fetch more at auction than Manitoba cattle. A lot more.

“One of the main reasons why Manitoba’s prices are lower is because they are the furthest distance away from any federally inspected slaughter plants,” said Canfax market analyst Brian Perillat.

The simple fact is that Alberta producers have beef plants close to home, while Manitoba producers get prices that reflect costs including transportation, handling and various markups along the way.

MCEC along with the management team behind the proposed new Winnipeg-based beef plant crunched the numbers and discovered that Manitoba producers are losing out on more than $5 million a year compared to their Alberta counterparts.

The analysis shows the average price differential over the first 10 months of 2011 between Alberta and Manitoba on fed steers was $10.16/100 lbs. On an average fed steer of 1,300 lbs., that works out to about $130 per animal. We also know that the minimum price differential on other cattle is $50/head for transportation alone.

That’s the reality that Manitoba producers have put up with for a long time. And it’s one of the things that MCEC is aiming to change by having a federally inspected beef plant here at home.

“If you feel like your animals aren’t worth what they should be in today’s market, then you’re right,”said Doug Cooper, CEO of the management team seeking to build a new beef plant in Winnipeg. “Our plan calls for us to pay Alberta prices for Manitoba cattle.”

“When somebody asks what we’re getting for our voluntary refundable $2-per-head MCEC levy, I tell them that I might just be getting $130 per head more,” said Chuck Gall, MCEC member and cattle producer from Moosehorn, Manitoba. “As a producer, it’s in my best interest to support building a new plant here at home.”

Most industry watchers predict transportation costs will only rise alongside input costs such as feed. That means the interprovincial price differential will only get worse.

By investing in a local plant, MCEC is trying to level that playing field and give Manitoba producers a better chance at long-term profitability and sustainability.

MCEC administers an investment fund that is fed by a refundable $2-per-head levy on every head of cattle sold in the province. That money is then matched by the province turning every $2 into $4. MCEC’s mandate is to use that fund to invest in projects to strengthen the Manitoba beef industry, with a special focus on bringing federally inspected beef slaughter and processing capacity back to the province.

Federally inspected slaughter plants are permitted to export beef outside of Manitoba, which makes them eligible to sell to large domestic supermarket chains as well as into foreign markets.

Fully 85 per cent, or 7,400 out of 8,700, of Manitoba’s cattle farms decided on their own against applying for a refund in 2010.

“We talk to producers all the time and they tell us that they know the risk to our industry if we don’t get new federally inspected beef plant capacity back in the province,” said Gaylene Dutchyshen, vice-chair of MCEC.

“It’s a positive sign that so many cattle producers are voting with their wallets on this very important issue.”

The post The $5 million advantage of local processing appeared first on Manitoba Co-operator.

The proposed 18-million-tonne-a-year Port of Outeiro would be built near Belem, the largest city in Brazil’s Amazon region. It is designed to surpass the 16.8-million-tonnes grains capacity of the Port of Santos, and the 14.8-million-tonnes capacity of the Port of Paranagua, the paper said.

Grains loading at Santos was disrupted for five days this week after a ship knocked a loading machine off the dock and into the water.

The new Amazon port proposal is scheduled to be sent to Brazil’s water transportation regulator for approval in the coming days, Folha said.

An auction to sell rights to build and operate the port’s 660-million-real ($382-million) first phase could be held as early as late 2012, the paper reported. It could begin operation in 2014, Folha said.

The port would provide a new way for farmers in Brazil’s states of Mato Grosso, Goias, Para, Tocantins, Maranhao, and other parts of the nation’s Cerrado, Northeast and Amazon regions to ship their grain to market, the paper reported.

It costs Brazilian farmers about $85 a tonne to transport grains to market compared with $20 a tonne in the United States and Argentina, Folha said.

Despite the transportation cost disadvantage, Brazil is the world’s second-largest soybean exporter and is expected to overtake the United States this year according to the U.S. Department of Agriculture. Brazil is now harvesting a soy crop of 70 million tonnes and about 60 million tonnes of corn.

The new port would allow farmers to use efficient barge trains to move their grain to port over Amazon rivers rather than smaller individual trucks running on overcrowded and poorly maintained highways. Much of Brazil’s crop must travel the distance from New York to New Orleans by two-lane road to get loaded on a ship at Santos or Paranagua.

A port in the north of the country would allow loading closer to markets in Europe and the Middle East. It would also be closer to the Panama Canal, cutting travel times to China, Brazil’s largest soybean market.

The post Brazil planning giant Amazon soybean port appeared first on Manitoba Co-operator.