Country guide west by Farm Business Communications

Is local food good for farmers?  8 | Hire a Millennial and reap the rewards  54

western EDITION / COUNTRY-GUIDE.CA / March 29, 2016

Brother & Sister

James Kuhl and Kristen Gray build a Manitoba farm  12

CROPS GUIDE New high-tech seeding  33 That malt barley lottery 36

PLUS: These dairy

farms intend to thrive post-TPP 24 Publications Mail Agreement Number 40069240

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MACHINERY Setting a new Tempo

Vaderstad launches new high-speed planting technology.

Business

Guide Life

53 HR

i s local food good for farmers?

Inside country guide / Vol. 135 Issue no. 6 / March 29, 2016

Believe us! Here’s how to be seen as more credible.

They’re out to prove our food system is broken.

16 how big? Small can be the right farm size, but it takes skill.

44 international influence

Farm machinery builds a more peaceful world.

46 hopes grow

for gene editing How science will take us far beyond GMO.

50 inspired to make

54 The millennial myth

a difference

Actually, the young people that everyone complains about can be great on the farm.

Growing the kids who will feed the world.

56 Health 57 Hanson Acres 58 Reflections

CROPS GUIDE 33 High-tech seeding 36 The malting lottery 38 ‘Chicken and

egg’ for new malting choices

42 Shatter losses in

straight-cut canola

Finding your farm self For this brother and sister team, success has meant plotting a very different direction for their conventional farm, and building a management system where each must contribute at the top of their game.

Features

22 Their quota of doubt Maybe it didn’t open the floodgates, but TPP will let in enough milk to change supply management.

24 Up for business How would you manage a dairy farm in the era of TPP and CETA? Three top farmers tell us their plans.

Our commitment to your privacy At Farm Business Communications we have a firm commitment to protecting your privacy and security as our customer. Farm Business Communications will only collect personal information if it is required for the proper functioning of our business. As part of our commitment to enhance customer service, we may share this personal information with other strategic business partners. For more information regarding our Customer Information Privacy Policy, write to: Information Protection Officer, Farm Business Communications, 1666 Dublin Avenue, Winnipeg, MB R3H 0H1. Occasionally we make our list of subscribers available to other reputable firms whose products and services might be of interest to you. If you would prefer not to receive such offers, please contact us at the address in the preceding paragraph, or call 1-800-665-1362.

COUNTRY-GUIDE.CA / MARCH 29, 2016

EDITOR’S NOTE

1666 Dublin Ave., Winnipeg, MB R3H 0H1 (204) 944-5765 Fax (204) 944-5562

EDITORIAL STAFF

A new think for supply management If you haven’t re-thought your own attitudes about supply management, you’ll find it worth reading “Up for business” starting on pg. 24 I never agree with everything that’s said in our pages. I don’t expect you to always agree either. The trickier issue is when we decide we don’t agree with a story before we read it. So we never get beyond the first paragraph.

Will more dairy farmers insist on a chance to produce for the market, instead of for quota?”

In this case I ask you to consider reading associate editor Maggie Van Camp’s “Up for business” from beginning to end, even if you have very clear or even very rigid views about supply management. We began with a question. With TPP and CETA eating away at supply management’s border controls, how would you manage a dairy farm today? True to form, Maggie’s interviews will bolster your respect for the dairy farmers she interviewed. On its own, I believe, that’s a good enough outcome to justify the space we’re giving the story. But there’s more. In my own case, my core attitudes about supply management had changed little in the past decade. I’ve figured supply management will survive as long as an overwhelming majority of its farmers support it.

management over the past decade and the transformation that we’re seeing now in supply managed farmers means we all need a more nuanced view.

Associate Editor: Maggie Van Camp mvancamp@fbcpublishing.com (905) 986-5342 Fax (905) 986-9991 Production Editor: Ralph Pearce ralph.pearce@fbcpublishing.com (226) 448-4351 Design & Layout: Jenelle Jensen

ADVERTISING SALES Sales Director: Cory Bourdeaud’hui cory@fbcpublishing.com (204) 954-1414 Fax (204) 944-5562 Kevin Yaworsky kyaworsky@farmmedia.com (250) 869-5326 Lillie Ann Morris lamorris@xplornet.com (905) 838-2826

I admit I’d be unlikely to vote for supply management if it came up as a new idea today. But I also admit that I find it surprisingly difficult to articulate an argument why Ottawa should dismantle the boards now.

Glacier Farm Media President: Bob Willcox bwillcox@farmmedia.com

In the past decade, the boards have actually made big strides in bringing new products to market, and equally big strides in ensuring the industry emerged from a series of processor rationalizations with its overall efficiency intact.

Production Director: Shawna Gibson shawna@fbcpublishing.com

I used to think the boards would falter due to the cost of milk or eggs in the grocery store. Now, when we see big price differences, I think we need to ask tough questions of retailers, the same as in other food sectors.

Yet it’s inevitable, I thought, that there will come a day when supply management’s most progressive farmers want out, which will mark the beginning of some very difficult days.

Much more troubling, I believe, is the boards’ failure to deal in any responsible way with the complaint that their farmers use governmentbacked incomes and assets to outcompete grain and livestock farmers for land and resouces. Their deafness on this issue is shocking. Maybe it should even be fatal.

Actually, I still think this, even though dissolving supply management would be much more difficult than dissolving the Canadian Wheat Board because of quota values and related isues.

There is much more to say, of course, but as the sector begins its decade of change, let’s make our own start by getting to know the farmers. So please read on.

I still think this could be true, by the way, but the evolution of supply

Tom Button Country Guide, Editor

tom.button@fbcpublishing.com MARCH 29, 2016 / COUNTRY-GUIDE.CA

Associate Editor: Gord Gilmour (204) 453-7624 Cell (204) 294-9195 Fax (204) 942-8463 gord.gilmour@fbcpublishing.com

These are not head-in-the-sand farms. More dairy farmers are doing serious scenario planning about surviving without the boards, even though they want supply management to stay.

Am I getting it right? Let me know at

Editor: Tom Button 12827 Klondyke Line, Ridgetown, ON N0P 2C0 (519) 674-1449 Fax (519) 674-5229 tom.button@fbcpublishing.com

Advertising Services Co-ordinator: Arlene Bomback (204) 944-5765 Fax (204) 944-5562 ads@fbcpublishing.com

Publisher: Lynda Tityk lynda.tityk@fbcpublishing.com Associate Publisher : John Morriss john.morriss@fbcpublishing.com Editorial Director: Laura Rance laura@fbcpublishing.com

Circulation Manager: Heather Anderson heather@fbcpublishing.com Contents of this publication are copyrighted and may be reproduced only with the permission of the editor. Country Guide, incorporating the Nor’West Farmer and Farm & Home, is published by Farm Business Communications. Head office: Winnipeg, Manitoba. Printed by Transcontinental LGMC. Country Guide is published 13 times per year by Farm Business Communications. Subscription rates in Canada — Farmer $43 for one year, $64 for 2 years, $91 for 3 years. (Prices include GST) U.S. subscription rate — $35 (U.S. funds). Subscription rate outside Canada and U.S. — $50 per year. Single copies: $3.50.

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Call toll-free 1-800-665-1362 subscription@fbcpublishing.com U.S. subscribers call 1-204-944-5766 Country Guide is printed with linseed oil-based inks. PRINTED IN CANADA Vol. 135 No. 6

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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.

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MACHINERY

Setting a new

Tempo Vaderstad introduces new models of its Tempo high-speed planters By Scott Garvey / CG Machinery Editor

weden’s Vaderstad is adding to its Tempo line of highspeed planters with two new versions that are destined for dealer lots in Canada. Mounted via a three-point-hitch, the new Tempo V planter is available in seven different models with working widths from 4.2 to 6.6 metres. The largest version is available as a 12-row, or as an eight-row with 30-inch row spacings. But with the Tempo V there is no need to be a stickler for standard row spacings, it can handle just about anything a buyer wants, which gives it flexibility for a broader range of crop types. “The machine’s frame is designed so that row units and fertilizer coulters can be moved to any position,” reads the company’s press release. “Odd row numbers (such as nine rows with 600-millimetre spacing) can also be handled on the same frame.” The Tempo V will be available with an optional fertilizer hopper that mounts on the front of the tractor. “It’s designed to meter out 250 kilos per hectare at 15 kilometres per hour,” said Gustav Samuel son, Vaderstad’s sales support representative at the company’s Agritechnica display in Hanover, Germany in November. The hopper’s wide lid allows filling with a front-end loader bucket. “It’s 2,200 litres (62 bushels), and we have an option to have an

MARCH 29, 2016 / COUNTRY-GUIDE.CA

Above: Although the 12- or 16-row Tempo L Series offers working widths of 12.2 metres, they fold down to a very narrow three metres for road transport. Below: A 62-bushel, front-mounted fertilizer hopper is available as an option for the Tempo V Series planters.

extension. Then it will be 2,700 litres (76 bushels),” said Samuelson. Beginning with 2016 models, Tempo planters will use an aluminum-bodied meter that replaces the previous composite material construction. Plus, it gets a new hatch designed for easier cleanouts, and the new meter design is capable of handling an even broader range of seed sizes. The company also used Agritechnica to debut its other new planter, the larger Tempo L model. Stretching the brand’s maximum working width to 12.2 metres, it’s aimed, in part, at attracting the attention of broad-acre farmers here in North America. But in typical European fashion, it offers a narrow road transport width, able to squeeze down to just three metres. The Tempo L will be offered in 12- or 16-row versions with row spacings from 700 to 800 millimetres (27.5 to 31.5 inches). It can also be equipped with a 5,000-litre (141 bushel) fertilizer hopper mounted on the front of the frame. To make filling easier, it is just a relatively low two-metre reach to the top filler opening. All Tempo models will use the brand’s maintenance-free “Powershoot” row units with adjustable coulter pressure. Like the iCon system used on Vaderstad’s Seed Hawk brand air drills, these Tempo planters use an iPad for implement control. But the Tempo system is called E-Control, and it allows for electronic control of all the drill functions, including individual row unit shutdown. Although the Tempo L made its public debut last November, don’t look to have one parked in your yard until the spring of 2017 when they will be available for general delivery to customers. CG

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Business

Is local food good for farmers? Canada’s social sciences council is investing $2.4 million in local food research. Here’s what they hope to learn By Lois Harris

March 29, 2016 / COUNTRY-GUIDE.CA

Why is SSHRC funding ag research? “Our food system is broken,” Alison BlayPalmer says. “It doesn’t work.”

So why is SSHRC funding an agriculture project, when most federal ag funding comes either directly from the federal agriculture department, the National Science and Engineering Research Council, or via various incentive programs targeted at industry? Blay-Palmer, after all, has already received ag funding through channels that might seem more regular, including $200,000 through an Ontario agriculture ministry project called New Directions for research into food hubs. Partly, says Blay-Palmer, it’s because as a university professor who has access to grad students and other research assistants, she tends to steer clear of research funds Continued on page 10

PHOTOS: ANNE DE HAAS

lison Blay-Palmer has been studying and promoting local food systems for nearly 20 years, and her enthusiasm for the topic is greater than ever. Blay-Palmer is director of the Centre for Sustainable Food Systems at Wilfrid Laurier University in Waterloo, Ont., where she explores the big questions around sustainability. Those big questions include social justice, a factor rarely considered in mainstream ag research. For her, looking into economics means not only farm incomes, but also migrant labour, access to affordable food, and what she calls food “re-localization,” or “closing the loop” — to retain as much money as possible in the community. And yes, this is federally funded research, although not exactly ag research. Last fall, Blay-Palmer was named International Government Innovation Chair in Sustainable Food Systems at the Waterloo-based Balsillie School of International Affairs. Even more recently, she obtained $2.4 million over five years from the national Social Sciences and Humanities Research Council (SSHRC) to look at community food projects that are happening across the country and around the world. SSHRC is the federal council that normally funds historians and sociologists, as well as English professors and creative writing centres.

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Business There’s a growing demand for local food that’s not going away,” the University of Alberta’s Mary Beckie says. “We should be capturing more of that market.” that are needed by other organizations and groups. As well, SSHRC seemed a natural fit because her academic background is in geography and environmental studies. But it also has to do with the nature of the project. Called the Food: Locally Embedded, Globally Engaged (FLEdGE) project, her SSHRC-funded research will assess how they can better meet the burgeoning demand for local food, and she will then feed the results back to industry and government for action. The study is being conducted in partnership with researchers in seven “nodes” across the country: the Northwest Territories; Alberta/B.C.; north, southwest and eastern Ontario; Quebec; and Atlantic Canada. To explain why the study is needed, BlayPalmer points in part to statistics showing farmers need off-farm income. “Farmers are facing economic instability,” she says. “For many farmers, if it weren’t for off-farm income, they wouldn’t have a farm.” Figures from Statistics Canada can support this. In 2013, the average annual total income for farmers was $117,388, with just more than $90,000 of that coming from off the farm. But the study is about more than economics. She believes something else is wrong with the way food production is perceived and pursued. “Food is about so much more,” she says. “Food could be a linchpin for addressing all kinds of issues,” Blay-Palmer says. “Sustainable” approaches to food production could help in many areas, including efforts to control poor health and obesity, unemployment and environmental degradation. Meanwhile, Mary Beckie is working on the same project in the West from her posi10

March 29, 2016 / COUNTRY-GUIDE.CA

tion as associate professor at the University of Alberta. Beckie says that while Ontario is a hotspot for this kind of research, Canada, as a whole, is far behind the U.S. and Europe. “I can count on one hand the number of people out here looking at this topic,” Beckie says. “There’s a growing demand for local that’s not going away, and we should be capturing more of that market because of the economic and environmental benefits to be had,” she says, adding that studies in the U.S. show demand for local is outstripping even demand for organics. FLEdGE has three main goals. First is better integration of the food system across boundaries and supply chains. An outcome of this work would be to get farmers, governments and civil society organizations to develop a national food policy. Second is scaling up and out by increasing the number of local food initiatives and building processing and marketing capacity. Beckie refers to this as “growing the middle” between primary agriculture and retail. Third is innovative governance, or finding mechanisms that allow government and other institutions to act more cohesively. Blay-Palmer uses the Canadian Energy Strategy, agreed to by the provinces and territories last summer, as a potential model for food. The study is ambitious in its scope, examining any initiatives that, in Blay-Palmer’s words, “shorten the distance between the farmer and the eater” — including community supported agriculture, alternative retail models, food hubs, online farmers markets and others. There is a lot of local food activity that

can be studied in almost all regions of the country. In Ontario’s Grey County, for example, its Local Food Project has been going on since 2007 and in April 2013, Philly Markowitz was hired as a full-time local food economic development officer there. Her vision is to attract, retain and support food-related businesses, including farms. Markowitz’s duties include helping small and medium-sized businesses attract customers, learn about new technology, obtain grant funding and more. She understands and takes into account the social justice, food security, environmental stewardship and other aspects of her work, but focuses on its economics. Of the people she works with, she says, “If there’s anything I can do to help their bottom lines and make their businesses sustainable, that’s a plus. My mission is to keep the small and medium-size businesses supported so we can have a true rural community — that’s how I get up in the morning and go to work.” There are a number of activities going on in her region. The Grey Bruce Culinary and Agriculture Association publishes a food map and runs Foodlink Grey Bruce, a website that lists 450 businesses that sell their products and services online to customers. Recently Markowitz worked with Georgian College to offer courses to producers and processors about understanding food safety regulations. Many local and provincial governments have recognized the potential contributions local food systems can make. Ontario has had a Local Food Act since 2013, and Alberta has a similar bill that’s expected to pass in early 2016. Alberta’s legislation is aimed at ensuring “a resilient, sustainable and strong local food economy and agricultural land base.” It is comprehensive and aimed at procuring more local food for more public institutions, promoting sustainable farming practices, attracting new entrants to farming, and recognizing indigenous food sources and systems. The legislation would even set out “to improve and maximize economic return and food security” by better protecting agricultural land and supporting infrastructure for food processing and distribution. While the results of the FLEdGE study are still five years away, Blay-Palmer is confident that working on and investing in local food production systems will produce greater stability for farmers and their communities. “Our food system is broken,” BlayPalmer says. “It doesn’t work.” CG

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feature

Finding your

farm self How one farm is using innovative business strategies to fuel its passion By Anne Lazurko / CG Contributing Editor

e hear much talk today about business models and strategies, and we read about new and innovative ideas to change and manage farm business. But what do the words actually mean? A “good idea” can be a proactive idea or even a reactionary one; it can be traditional or alternative. But it would seem that in order to change, and in order to create something new, farmers must first look in a mirror and see where they are at. And then look to the distance and see where they want to be. Large or small, organic or conventional, family or corporate, there’s a process to changing the direction of your farm. It may not be obvious. And it almost certainly won’t be easy. But if done right, a farm might just find its true calling. For Manitoba siblings James Kuhl and Kristen Gray, it started with asparagus. Well, technically, it started with potatoes. But a decision made by their father 15 years ago to put a few potato acres into an alternative crop set the farm on a course that would see them not only grow the asparagus business, but examine new business models for their operation and design new strategies to reach their goals. Today near Bagot in the Assiniboine River valley just over an hour west of Winnipeg, their newly incorporated River Valley Specialty Farms grows and sells edible beans, quinoa, and hemp along with the asparagus. By 2019, the brother and sister plan to more than double their certified organic acres to 2,500, acquiring glutenfree certification of some products as early as this fall. Two years ago the farm was still primarily a potato operation. But last year, the farm grew 900 acres of potatoes, 1,200 acres of edible beans, 1,000 acres of grains, 120 acres of asparagus, 35 acres of quinoa and 400 acres of transitional hemp. So what changed? According to James, it was a storm in the potato world. With the Canadian dollar until recently at par with the American, there was no advantage to process-

MARCH 29, 2016 / COUNTRY-GUIDE.CA

ing potatoes in Canada, he says. “We saw that contracts were being cut and it made us really nervous because potatoes are so capital intensive. With the potential to lose the contracts, we could see it was not good for us from a business perspective… so the past three or four years we’ve been talking about how to survive.” In the midst of this discussion, the siblings (James is 36 and Kristen 38) were also trying to figure out how to transition the farm in a way that would allow for growth of their business while seeing to the needs of their parents. “With the asparagus we could see potential market growth and solid prices,” James says. “And we were learning about it and having fun.” “We love the marketing aspect of it,” chimes in Kristen. Early on, Federated Co-op helped them with marketing and management, growing with them as they figured out what it is that buyers want and how to provide it. “We’ve grown and our product is now in Safeway, Sobeys and Loblaws, with the possibility of Costco this year,” Kristen says. “The foot in the door with asparagus was huge. We just have to ask what they need and they trust us to supply it. We know where the markets are and what’s coming up, and we will adjust our cropping accordingly.” Able to gain marketing savvy through the asparagus business, they can also use its existing coolers, grading lines, and packaging and storage capacity for other crops. As well, the farm has on-site housing for up to 60 employees. River Valley Specialty Farms employed 66 people to cut and pack product last year, all accessed through the Seasonal Agricultural Workers Program, a program both say is vital to their success. “We wouldn’t be able to do this without SAWP,” says James. “Without that program it would change this conversation entirely.” It’s clear that the foray into asparagus laid the groundwork for what comes next. And what comes next is pretty huge.

For this brother and sister, a structure with each contributing at the top of their game is a key to success. James heads up operations, Kristen is chief administrative officer.

Business Models: Making the Tough Decisions “We haven’t made this business go yet,” says James, “but it’s so exciting to try.” And it’s exciting just to listen to these two. James and Kristen have such clear goals and timelines around transitioning the farm to organic production of a variety of crops, it’s hard to believe most of their plan has yet to be realized. With a diploma in agriculture, James is chief operating officer, lives in Portage la Prairie, and is responsible for all operational and production areas of the farm business. Kristen has a degree in psychology and criminology and is chief administrative officer. She directs the financial and marketing side of things, traveling from

her home in Winnipeg to work most weekdays at the farm office. They each bring their own particular skills and perspective to the table. Their process of change began with a hard look at their business model. Most of their farm is comprised of small parcels of irrigated river flatland without easy access to each other. This makes it clearly unsuitable for say, canola, but perfect for specialty crop rotations. So while most farm business models tend toward increased acres to offset decreased margins, James and Kristen chose the opposite. They are downsizing. They’ve kept all the highly productive river flatland that’s perfect for vegetables and beans, sold some other parcels, and are Continued ON page 14

COUNTRY-GUIDE.CA / MARCH 29, 2016

feature Human resources management becomes crucial in an operation with 66 employees in peak season.

counting on the larger margins that organic and specialty crops can provide. “Every farm has to find out who they are and what they want to be,” says James. “We discovered who we are by first looking at crops and management and realizing we were not profitable in the structure we had… we started to understand what potential we have with the assets we have left.” They worked very closely with an accountant to do their financial analysis, breaking out each part of the farm and taking a close look at the numbers to project their financials into the future. “It’s a three-part plan,” says Kristen. “Right now we have the asparagus, conventional, and organic crops. Eventually we would like to be all organic except for the asparagus.” Strategies: What’s It Going To Take? The scrutiny doesn’t end once the planning is over. The business does a monthly financial health check, analyzing the numbers and revisiting and revising the plan as necessary, says Kristen. “We are in constant communication with buyers and we plan according to market opportunities.” “We don’t have a five-year crop plan and we won’t make one because it allows us the kind of flexibility we need,” says James. It doesn’t hurt that smaller parcels of land are more easily transitioned to new crops, allowing for rotations that meet the market as well as soil fertility needs. It’s another aspect of organic production that appeals to James. He’s implementing green manure crops to satisfy a portion of the land’s fertility needs. “We struggled under conventional because sometimes due to economics we had to push the rotation and I didn’t feel good about that in terms of the soil. Hopefully we’ll have a bit more freedom now to change options and build the soils back and be sustainable on the production side.” Another critical area in terms of operations is equipment. “We won’t need big, expensive equipment,” he says. “I can use older, smaller equipment. Instead of a half-million dollar rotary combine, I can use a $75,000 conven14

MARCH 29, 2016 / COUNTRY-GUIDE.CA

tional. I’m very excited about not tying up so much capital in equipment.” Currently James manages 60 people, the vagaries of growing specialty crops, irrigation, and weed control. James admits he might get a bit of a breather in terms of intensive management as the farm transitions, but he knows that once it is fully organic he will need all his management skills to make the plan work. If transitioning land to organic is an exercise in agronomic patience, it is also a world of paperwork, and as head administrator Kristen is in charge. Food safety, traceability, organic and gluten-free certifications are all on her plate. “We are making sure we have the top certifications with top marks in each,” she says. “And we want to make sure we have it before we’re even asked for it. It’s a must in today’s marketing world. We can’t be naïve about it. I used to think all the paperwork was just a pain, but I realize how important it is. In fact, for some buyers a pass isn’t good enough. They are looking for a particular percentage mark so we have to be on top of it.” But the transition to organic is about more than markets for Kristen. It’s personal. “I want to feed my own family as many locally grown and organic products as possible, so these aspects are very important to me.” The next three years will see continuous change at River Valley Specialty Farms as parcels of land are transitioned to organic.

What does success look like? Essentials that are on farm adviser Terry Betker’s checklist: • Specifics on structure, with clear organization and accountability for important roles. • Structure around farm meetings, actual sit-down-with-an-agenda-type meetings. Robert’s Rules aren’t necessary, Betker says, but regular meetings allow farmers to drill down into how the farm is doing, where it needs to go, and how to get there. • Testing progress, establishing the metrics around what needs to be accomplished in four or five key areas, including finance, operation, marketing and human resources.

One might logically wonder how the farm will survive the financial burden. To that end, James is looking at opportunities for value-added on the farm to provide income and a little security against risks. “We formalized a really good business plan without the value-added,” James says. “But it’s a little extra security.” And the asparagus. Always the asparagus. Both Kristen and James agree the farm will rely on the asparagus business to see them through. “It’s a proven, profitable business,” Kristen says. While they agree the planning has been hard and there’s a huge learning curve they will continue to navigate into the future, James and Kristen are also confident that

their experience and growing expertise in producing and marketing specialty crops will see their plan to fruition. “There’s been many lessons learned over the past 10 years that have given us confidence dealing with direct marketing,” says James. “A big part of this was going to Toronto a few years ago and meeting with a Loblaws buyer,” James adds. “A lightbulb went on for me. I realized these companies want to deal with me. I was just a young guy and it was intimidating, but they really wanted to deal with me.” Hearing the enthusiasm in their voices and the confidence these two have in their plan and for the future of their farm, it’s little wonder. CG

B arriers to change Farm adviser Terry Betker sees a big hurdle in the way of making changes to farm businesses. Basic resistance to change seems selfexplanatory, but it’s not easily overcome. It’s easier to work on symptoms than to tackle root causes. By nature farmers are doers. They like to see concrete results. But long-term success requires identifying the root issues that need to be addressed. This too is work. Farms also don’t always know how to develop measurements of success (i.e. not just financial). These, Betker says, are crucial too.

B etter decision-making

Farm business models aren’t keeping up, and our farms are losing out as a result

Financial and farm advisers throw around terms like “model” and “strategy” coupled with other words like “innovative” and “new,” as though we should all be excited about them. Siblings James Kuhl and Kristen Gray at River Valley Specialty Farms embrace the ideas these words create, maybe because they’ve managed to use new and innovative models and strategies to point their farm business in a direction that fits their passion (see main story). But for many farmers who struggle to get more production out of their farm, or to make more money, or to meet goals to enrich their personal lives, these terms are just euphemisms, words that mean change. And as we all know, change is hard. So what is the key to making those changes that will help farm managers to reach their business goals? While there is no one model or strategy to fit the needs of every farm, it helps to break the process down to its simplest form. “Examine where you’re at and where you’d like to be in the future, and the strategy is how you get there,” says Terry Betker at Backswath Management in Winnipeg. “It is no more complicated than that.” The process may not be complicated, but

making a decision can be. Betker encourages farm families to look at the future, set goals, test the financial feasibility of an idea and then plan. And the more people involved, he suggests, the more important it is to clearly set out a vision, to define what the farm is working toward, and to have everyone on board. Betker also suggests using the services of a facilitator to lead this discussion because often on the farm “we have a lot of talk, but not a lot of focused discussion.” If knowing your goal is key, so too is understanding why you’re doing what you’re doing. “Will a good idea put you any further ahead than doing nothing?” Betker challenges. “That discussion is largely about the numbers because it separates business from emotion. It creates a context. The numbers don’t make the decision; the numbers create the context for the decision.” For example, in the last number of years there’s been more profit made in agriculture and so more cash on the farm. This context allowed producers to be more proactive and develop new strategies as opportunities presented themselves. But as margins tighten up, it is financial profitability that drives decisions, and so strategies to save money become more reactive.

Betker believes that farm business models have not kept pace with change on the farm. He sees a lack of ideas that are both innovative and cost effective, though he points to a small number of farms finding ways to do both. Some use models designed to manage capital investment, like sharing drying systems or sprayers. Or they manage operational costs, such as sharing the services of an agronomist. Some large farms want to get more productivity out of their human resources, so they pool together to hire a consultant who spends one day a week at each farm. Models can be traditional or alternative, Betker says. “They can be revenue-based, niche, or value-added. Even downsizing is a model, depending on where you’re at. But all models have to first start with a close look at what you’ve got.” Then, when the plan is in place, there must be follow-through. Change is hard. Building a new business model for your farm and deciding on strategies to achieve your goals can be overwhelming. But starting with where the farm is at, determining where it needs to be and charting a course to get there, seems a pretty straightforward remedy for the fear that might accompany such an endeavour.

COUNTRY-GUIDE.CA / MARCH 29, 2016

business business

How big? Once they reached the farm size they wanted, Ian and Vicki Mayberry have found ensuring it is sustainable takes skill, and self-awareness By Helen Lammers-Helps

MARCH 29, 2016 / COUNTRY-GUIDE.CA

or many farmers, there’s a belief that you have to “Go big or go home.” Yet Ian and Vicki Mayberry take a different approach on their farm near Ingersoll, Ont. They like the size they’re at with 170 milking goats plus offspring, so instead of expanding they are looking to maximize production with their current setup. It seems to be paying off. Since they began milking goats in 2005 at their Mayberry Hill Farm, they’ve seen their annual milk production climb from 800 to the farm’s current 1,200 kg per goat, a 50 per cent increase in just over a decade. Yet Ian knows it needs to be a deliberate choice. “I can’t really expand without building a new barn,” he explains. “After spending so many years with an Oxford County-sized mortgage, we can finally see that there will in fact be an end to it. I have no interest in going into debt to that level again. There are too many other interesting things to do in life.”

Those other things in life include life away from the farm. For instance, Vicki and Ian do lots of training and racing for duathlons and triathlons, which opens up many new travelling options. “If I did expand I would be able to afford a full-time employee, but that means I would have twice as much work on the weekends to do,” Ian says. “Once in a while when I have a great employee, such as now, I seriously consider expanding, but generally procrastination keeps me from doing anything too drastic.” It’s a statement that hints at a kind of restlessness that comes over most farmers. Shouldn’t I keep growing? Ian tackles the question head on. “I find myself in an odd position. I am extremely happy with the way the things are going right now. Over the last few years the farm has performed like I always imagined it should.” It has taken more than a decade of hard work to get to that point, yet he wonders whether he shouldn’t keep that burst of energy going, even though land in his part of Ontario is prohibitively expensive.

Instead, he and Vicki have focused on technology and marketing in order to achieve their dreams within their current limits. It has been a multi-pronged effort. There are multiple reasons for their sustained increases in production. For instance, they have adopted artificial insemination (AI) for their replacement nannies with a focus on increased production and longevity. Also, they have switched to a TMR ration and they are striving for a CAE negative herd. (CAE, short for caprine arthritis encephalitis, is a type of arthritis common in Ontario goat herds that affects lung and udder health and can severely impact milk production.) These advances have been achieved with the help of a good team of advisers. “Having a good relationship with your support team is essential,” says Ian. “You have to go into the relationship with a level of trust. You have to understand that the nutritionist is not going to be able to get you the Continued ON page 18

Health and AI technologies, plus close links to feed advisers and their veterinarian have helped the Mayberrys achieve consistent, efficient production numbers.

COUNTRY-GUIDE.CA / MARCH 29, 2016

business cheapest feed every time you call for a load, but they should have an understanding of how and why you do things on your farm and help you work towards your goals.” In addition to the feed company, Ian credits his agronomist and veterinarian for playing key roles in the farm’s success. The path to success has not always been straight or easy. As a young man, Ian didn’t think he wanted to farm. Then he headed to Australia where he worked on a 12,000-acre wheat farm. While travelling in Australia, he met Vicki and once they settled down and had their first child, the desire to give their children the same kind of upbringing that Ian had growing up on the farm took root.

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Ian and Vicki and their newborn son returned to his family’s farm in 2003 but by then the dairy cows and quota had already been gone for seven years. Ian’s father was ready to retire from farming, so the Mayberrys grew cash crops on the farm’s 170 workable acres while they figured out their next steps. They considered several different livestock enterprises, and while both dairy and chickens had appeal, the high cost of quota was a big deterrent. They almost went into pigs but in the end it was the availability of a goat herd that tipped the scales towards dairy goats. They started with just 70 goats, mostly Saanen and Alpine breeds, and Vicki recalls how tough it was those first few months. The goats took a long time to freshen up and for several weeks there wasn’t enough

milk to warrant a truck coming to pick it up, she says. Although it was hard, Ian says it was good not to start with too many goats at once. Caring for the kids, usually twins and triplets, is a lot of work. They also had a big learning curve since neither had experience with goats. Eventually they bought another 100 milking goats, bringing their total to 170, which is a good number for them to manage with just the two of them plus help from one part-time employee and their two children, now 11 and 12. Even with the additions they’ve put on the original barn, it will only comfortably accommodate about 200 milking goats, adds Ian. Ian was never happy with the original parlour they

had installed, a double 18 with a low milk line. “If you only have one person milking this type of setup is terribly inefficient. You have half the milkers sitting idle while you chase animals in or out of the other side of the parlour,” he says. Ian likens the equipment to an English sports car. “It was great when it worked.” Last summer he had a new highline parlour with a swing over system installed. “Now all of the milkers are working almost all of the time,” says Ian. In 2010, Ian and Vicki participated in GoGen, a project of Ontario Goat, a producer organization. With funding from the Canadian Agricultural Adaptation Program (CAAP), the focus of the three-year pilot proContinued ON page 20

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business

Now we are in the position that we had been working towards for the last 12 or 13 years.” Ian Mayberry

MARCH 29, 2016 / COUNTRY-GUIDE.CA

gram was herd health protocols and breed evaluation through registration, milk recording, young sire testing, genetic evaluation, type classification and assessment of artificial insemination use. Ontario Goat is an important source of information, says Ian. “They have excellent producer education days where they bring in world-class speakers from Canada, the U.S., as well as Europe and New Zealand. They come and they share information about their industries, both turmoil and triumphs.” GoGen was a cost-share program so Ian says he jumped at the opportunity. To eradicate CAE, they rented a barn from a neighbour down the road. The new babies were taken away from their mothers right away (CAE is passed from the mother to her young through milk and bodily fluids) and took them to the rented barn where they were fed pasteurized colostrum and milk replacer. After doing that for two years, they sold their original herd, cleaned out the barn, and moved all the CAE negative animals back home. The GoGen project was a success not only for Ian and Vicki but across the board. Among the dozen participating producers, farms were able to increase their milk production by five per cent with the increased level of management. While initially focusing on production for genetic improvements through artificial insemination, after the GoGen project, Ian began looking more closely at all traits when selecting sires. In particular, he wanted to focus on the overall stature of the nannies. “This is extremely important as goats get older they tend to give birth to twins and triplets. With that many babies in there, there isn’t much room for anything else and it can be difficult to get a goat to consume enough to keep herself and her babies healthy in the last couple of weeks of pregnancy.” Paying attention to genetics can pay off quickly with goats. By the time they are nine or 10 months old, they are full grown and sexually mature. “Gestation is only five months so in barely over a year, you can have a brand new line of genetics in your herd,” he says. Ian has done some work with embryo transfers but without success so far. He would like to try more embryo transfers in the future. Goats are seasonal breeders so it’s a challenge to have them breed at different times of the year in order to maintain milk production year-round. While there are medications that can help, the Mayberrys had their best success using artificial light to encourage breeding. By exposing the nannies to 16 to 18 hours of light each day for a period of 60 days, the goats will come into heat. In addition to the CAE, the other health challenge with goats is to prevent them from getting listeriosis, a deadly infection caused by listeria bacteria. They are highly susceptible to the bacteria which may be present in silage so they remain very vigilant. The Mayberrys also keep a dozen Belgian Blue beef cattle to eat any feed which is not suitable for the goats. The Belgian Blue cattle are a good complement to the goats, says Ian. Not only are they able to eat feed of a lesser quality such as hay that’s been rained on, their temperament is the opposite of the goats. While the goats are very active, the Belgian Blue cattle have a very calm temperament, he explains. The outlook for the goat milk industry remains rosy. Milk demand is strong, as is demand for young goats. For now, says Ian, it means the Mayberrys can stay the course with their management strategy. But, he admits, he’ll keep his eyes open. “I worry about becoming complacent,” he says. “But now we are in the position that we had been working towards for the last 12 or 13 years.” CG

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Their quota of doubt TPP may not have opened the floodgates, but it will let in enough imports to alter the outlook for Canada’s dairy farmers By Amy Petherick / CG Contributing Editor

t would have taken a lot more than a butter knife to cut the tension on dairy farms across Canada this past year while the Trans-Pacific Partnership (TPP) negotiators were talking behind closed doors. So now that the deal is out in the open, and now that it appears — at least on the surface — that farmers might be able to work with it, you might think they’d be happily setting about to forget all those sleepless nights. That’s not what’s happening. Not at the board level, and not for individual farms. Looking back, dairy farmers learned a lot from the Canada and European Union Trade Agreement (CETA) negotiations that they were able to use in the TPP talks, says Therese Beaulieu, assistant director of strategic communications for 22

the Dairy Farmers of Canada (DFC). “With CETA, we learned some lessons,” Beaulieu says. In particular, Beaulieu says, DFC learned a lot about what it takes to keep from getting thrown off their game. Sure, it would have been ideal to avoid having to make any market concessions, she agrees. But you have to live in the real world, she says, so the big lesson was to concentrate on the good of the industry, not just on exactly how many kilograms of which milk components get to cross the border. “We want this industry to continue to be healthy,” Beaulieu says. “We want this industry to continue to grow. That’s what we needed to focus our energy on.” Most dairy farmers seem to agree TPP resulted in rules they can live with, but they also

MARCH 29, 2016 / COUNTRY-GUIDE.CA

Learn from the wheat board Wheat growers emerged as winners when they tested the market before the pool collapsed Ross Purdy, of Ross Purdy Agriculture Business Advisors in Airdrie, Alta., believes getting on top of cash flow goes hand in hand with paying attention to working capital. On today’s farms, it’s more important than it has ever been, he says, because the business today is so much more sophisticated. “When I first started lending money to farmers a long time ago, it was less complex and people had a better handle on what they could and couldn’t withstand,” Purdy says. “Now, a wellmanaged operation always anticipates if something unusual happens.” Purdy doesn’t mean that farmers need to operate in a constant state of paranoia, but he does feel it’s important to avoid complacency. He believes this was really evident in Western Canada during the demise of the Canadian Wheat Board. Farmers who had explored new ways of selling their grain before the wheat pool collapsed didn’t end up struggling as much to adapt, Purdy says. “A lot of people that were successful had not been using the Canadian Wheat Board as much, thinking someday they may no longer be around and of course, they weathered the storm better than others who did not do that,” Purdy says. “Any good operation has to anticipate the skies falling to see where you would end up and where you could do things differently than you’ve done in the past.” Be warned up front, this very well may result in some money being left on the proverbial table. For example, you may be able to enter into a supply agreement with people at a price that you need right now. Then, later on, the free market may exceed that price at times. But if it ensures you can pay more for a new quarter section than what the productive value of that land is and you’ve locked that cost in as far out as you can to avoid the risk of an increase in interest rates, Purdy argues it’s worth at least considering. “Your ultimate goal is to protect equity, and part of equity erosion in agriculture of course comes when prices correct,” Purdy says. “What’s in your control is what you watch.”

agree on something else, and so does Beaulieu. Now is the opportunity for farmers to ask themselves what they would have done if things had turned out worse. Any business needs to wrestle with those hypotheticals from time to time, Beaulieu says. “In other sectors of agriculture, the market swings and the farmers who survive are the ones who are thinking longterm, are doing investment and keeping their eye on their business goals,” she says. “In dairy, the new reality is that almost 25 per cent of milk produced will be affected by world prices.” Add in the fact that world dairy price fluctuations are getting bigger, and it means that even though Canada’s supply management system has been left intact, there will be significant impacts for farmers. At the bottom, it’s also similar to debates about GMOs, humane housing, and anti-microbials, Beaulieu says. Whether you’re in or

out of supply management, trying to stonewall any and every kind of change is rarely if ever a winning strategy. So if TPP forces a lot of dairy farmers to carefully consider what they do and where they ultimately want to be, then that may be a good thing. Agriculture doesn’t always get that chance, she says, and she points to the disruption BSE brought to beef. Sometimes, she says, all the planning in the world can’t mitigate every problem. The best anyone can do is take away the lessons that they can. For milk producers, one of the lessons was that supply management is only a tool, not impenetrable armour. “Supply management doesn’t mean that you don’t have to worry about the market,” Beaulieu says. “Most of the farmers I know have an eye on what’s going on internationally.” CG

In dairy, the new reality is that almost 25 per cent of milk produced will be affected by world prices.”

Therese Beaulieu

What you can control

To take the bumps out of any transition, keep your focus on the issues you can take charge of Our success at changing during tumultuous times has a lot to do with our perceptions, not just our skills and capabilities, says Dr. Kathleen Kevany, associate professor at Dalhousie University. It’s a crucial point, because focusing on what we can control changes our perceptions, and it means we can weather hardships with less frustration. “Whether we see ourselves as powerful and capable, or whether we see ourselves as being subject to external factors more than we desire, that’s a very different orientation to the world,” Kevany says. “If we can align our expectations more in keeping with what is likely to happen, then our frustrations are much more reasonably managed.” Kevany grew up in southwestern Ontario, so she’s observed how the regulatory nature of farming and the growing impact

of external factors can lead more farmers to question whether they’re really in control. But the nature of the farm lifestyle also fosters an ability in individuals to overcome challenges, a trait that gets called “resiliency” in the academic world. Typically, we may think resiliency is learned and deployed as an individual, but Kevany says her work also explores ways that resiliency can be nurtured collectively by entire communities. Within the farming community, developing a sense of belonging, a sense of trust, and confidence in reciprocal relationships are all really critical in the recipe for improved resiliency. In fact, her top advice to farmers who want to cultivate their ability to thrive in times of change is simply to have parties. “The more you know someone in good times, the more likely you’re going to be available to each other when times are

tough,” she explains. Engaging with other individuals who are subjected to similar external pressures and managing to succeed in spite of those challenges can be very empowering, Kevany says. But if you’re going to get maximum impact, as an individual and as a community, don’t limit the guest list to only the most successful. “Include marginalized or less active individuals in the community because they are often the ones most vulnerable in a crisis,” she advises. In other words, when trouble comes to the community, these individuals become the first casualties. Mentoring or accepting mentorship during a crisis, or at any time, has great potential to foster personal capacity. “Those emotional events are not without purpose,” Kevany says. “Interpersonal relationships are core to our success in any field, but particularly in farming.”

COUNTRY-GUIDE.CA / MARCH 29, 2016

FEAture

UP FOR

Business TPP turned out much better than the dairy industry had feared, but its farmers are determined never to let themselves be so vulnerable again By maggie van camp / CG associate editor

MARCH 29, 2016 / COUNTRY-GUIDE.CA

t’s The sort of CASE Study that business schools dream of. If you owned a dairy farm, where would you go from here? At three different points in their careers, three very different dairy farmers tell us on the following pages how supply management works for their farms, how it has sometimes failed them, and how they see their milk farms prospering in the future. They aren’t expecting it to be easy but by sticking to a rigorously businessminded approach, they do expect to survive, and to thrive.

Taking over For this young couple, the future means a multi-pronged business strategy, with cost control, diversification and a focus on efficiency

ust as the Trans-Pacific Partnership agreement was being signed last fall, Cam and Stephanie Murphy were signing a very different sort of partnership agreement. They were becoming part owners of a 45-cow dairy farm near Hastings, two hours east of Toronto. Together with Stephanie’s parents, Dean and Carol Warner, they took on a seven-figure debt to buy out a retiring uncle and start building a future. Taking this step during tenuous trade negotiations took an unbelievable level of trust in the system and each other, a love of their industry, and big dollop of bravery. It also took a clear vision of a future they have already started to work toward. Throughout Dean and Carol’s 30-year career as dairy farmers, trade deals such as NAFTA raised periodic doubts about supply management, but the couple hoped that as long as the Canadian government supported supply management, it would be safe.

They knew, though, that the TPP negotiations could mean the death of supply management and the end of their retirement and succession dreams. “Since I’ve been dairy farming, there’s always been that fear,” says 62-year-old Dean. Local dairy meetings buzzed with rumours. News reports claimed Canada would give up 10 per cent of its dairy market, and Carol admits there were times when she felt sick at heart. As the bookkeeper for the farm, she knew how devastating such a high import level could be. Then, when the agreement was announced, and the total access to Canadian markets was set at 3.25 per cent of Canada’s 2016 milk production, although it definitely meant a loss of income, it seemed relatively acceptable, and it helped that the banks quickly came forward with promises to still leverage debt on quota values. In that context, you might imagine that the ride was even more anxious for the younger generation. It was their future being negotiated and publicly debated. That’s not quite how it played out, however. Their youthful approach to risk helped them keep it in perspective. “It didn’t worry me,” says 32-year-old Cam. “We’d just start again. We’ll work with whatever system we’ve got.” Continued ON page 26

COUNTRY-GUIDE.CA / MARCH 29, 2016

FEAture Despite higher costs, Canada can be competitive through higher productivity and diversification, say Cam and Stephanie Murphy, front, with her mother Carol, sister Lacey and father Dean.

Even if supply management fell apart, Cam thinks he and Stephanie could still make it farming, as long as they weren’t carrying too much debt. “We’d just have to increase capacity, efficiency and lower our costs somehow… as long as we can cash-flow our debt.” The irony is that Cam’s home country is New Zealand, and he had worked on dairy farms there and around the world before ending up on a sheep farm in Canada and meeting Stephanie. Now, New Zealand was the country leading the charge against Canada’s supply management system. In fact, Cam grew up in the era when the Kiwis chopped their own lucrative subsidy programs and many farmers there were still figuring out either how to adapt or get out. Since then, the dairy Fonterra, owned by 13,000 New Zealand dairy farmers, has surged ahead. It takes and processes the majority of New Zealand milk, and it has become the largest dairy exporter in the world, not to mention that it is where Cam’s mother works. Indeed, New Zealand’s milk exports today are booming, especially since UHT (ultra high temperature) milk has extended shelf life, allowing liquid milk to be shipped anywhere in the world, and the dairy co-operative now accounts for 25 per cent of all exports of any kind from New Zealand. “At home,” Cam says of New Zealand, “the farmers are expanding all the time, quickly. Just add more cows, more land and they grow.” However, with trade disruptions, increased exports and volatile oil prices, the world milk price has plummeted. New Zealand farm prices went from nearly $10/ kg a few years ago to under $5/kg today, Cam points out. “You can’t budget a 10-year plan with fluctuations like that,” he says, shaking his head. “Heck, with prices like that you may not be able to pay your bills.” Production per cow in New Zealand is about half of what it is in Canada, but thanks to year-round pasture and the use of palm kernel extract as a supplement, their cost of production is among the lowest in the world. 26

MARCH 29, 2016 / COUNTRY-GUIDE.CA

Conversely, according to a recent German-based study, Canada’s average cost for milk production is the highest in the industrialized world, second only to Switzerland. Producing 100 kg of milk in Canada costs US$37 more than on farms south of border. For Canadian farmers, part of the risk from open trade starts with our climate and geography, especially our proximity to the U.S. This puts our dairy and feather sectors in a much weaker position than countries close to places with growing milk and protein demand, like New Zealand’s proximity to Asia. “Canada can compete in dairy globally, but it certainly won’t be easy. The gap needs to be narrowed,” said University of Guelph economist Sylvain Charlebois, in a recent newsletter article called “The Land of Milk and Wine.” Added Charlebois: “The only way to achieve higher levels of productivity is through economies of scale.” As he looks at daughter Stephanie and son-in-law Cam, Dean agrees, but he doesn’t think the odds are as bad as many outside the industry might think. Dean has travelled widely as a respected cattle judge, and he says many U.S. dairy barn buildings are in poor condition, and family farms will go out of business quicker there. Dean also doubts the US$37 number, saying it ignores the cost of complying with government programs in the U.S. “Price-wise, we can compete,” he says. Farms in the U.S. tend to be bigger than his, Dean agrees, and they support fewer families per herd. Currently his family milks 45 cows in a tie-stall barn with 220 acres owned and 220 rented, and they own 52.09 kg of quota. The price is capped in Ontario at about $24,000/kg. Since Dean started farming in the early 1980s, he has seen many changes, including in the early ’90s when the Ontario board combined fluid and MSQ (industrial milk) into one quota, which meant he and Carol had to milk four more cows to get the same gross revenue.

They have survived other major changes too, including the hit they took when the closing of the borders due to BSE led to the loss of livestock sales. Those sales never came back, and now milk makes up 90 per cent of their revenues. Before BSE, it was 70 per cent. Dean has seen changes in quota prices too. By 2000, prices had reached $30,000 per kg, but during the last decade dairy product consumption has slowly declined. “In Ontario, the board has set a goal of two per cent growth,” says Dean. “The marketing boards have to create growth.” To turn that boat around and keep the industry strong, Dean and Cam agree that processors, producers, transportation, government and consumers — everyone along the supply chain — must somehow work better together. “If we were all more team players — with the processors and with all the provinces — and have the whole country stand together, there would be more power to do things,” says Cam. Still, the future is ahead of them. Dean passed his livestock knowledge and passion on to his daughter and Stephanie’s goal is to win another Master Breeder award for the herd. Cam meanwhile is more business oriented, focused

on improved profit margins and growth, including expansion into other livestock. “Eventually we want to milk more cows, have sheep and a herd of beef cows,” he says. Cam is interested in ways to integrate these three separate enterprises to maximize land and labour efficiencies, and he says diversity of enterprises on the farm should help mitigate risks, including volatile markets and trade issues. One month into their succession, milk production was already up, likely due to good forages and applying knowledge that Stephanie gained in her now essential off-farm job as dairy and beef specialist for Grand Valley Fortifiers. Both she and Cam are looking for ways to tweak efficiencies and improve profit margins so they can be in the position to update their facilities. Farms are not grown from economic philosophies or trade negotiations. It takes farmers who dream and make it happen, the family believes. Today it also takes leveraging and predictable cash-flow projections. “No system is perfect,” says Dean. “But at least this ensures a fair, stable price for everyone.” Continued on page 28

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FEAture

Focus on efficiency The good old days aren’t coming back, but the Bassas believe success is still possible for farms that focus from top to bottom on efficiency

n 1991, Piet and Ina Bassa sold their dairy farm in Holland, packed up their family and headed to Canada, leaving not only Europe’s high costs but also its tough environmental regulations and manure quotas that made expansion almost impossible. Importantly, their sons, Jan and Kees, were keen to start farming, so the family bought a farm near La Broquerie, Man. plus 65 kgs of quota for $7,100 per kg. At the time, dairy quota grossed about $0.40/litre. Today, 25 years later, Manitoba dairy quota is worth about $28,000/kg and returns about $0.76/litre, says Jan. “On our farm, quota had a five-year payback. Now it’s more like a 10-to-15 year payback.” Like many supply managed farms, the Bassas leveraged on increasing quota value and accumulating assets as quota went from $20,000 to $33,000. But the brothers set limits. Once quota got over $30,000/kg they stopped buying. Jan says profit margins got too small at that point. Today, the Bassas milk 450 cows three times daily to fill 28

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604 kgs of quota, and they crop about 2,000 acres, renting only 100 acres. The farm employs nine full-time and eight part-time staff, and in 2010 Jan and his wife Tracy were selected as Manitoba’s Outstanding Young Farmers. Under the supply management system, the Bassas weren’t afraid of debt as long as they could cash-flow it. However, that was during a time of rapidly increasing quota values. Now, with the 15-year cap on support promised by the former conservative government, it’s time for a rethink. Today the Bassas are taking a more conservative strategic approach to their business. With not much land available to buy and its higher prices, they aren’t aggressively pursuing farms, although if one became available close by, they’d take a serious look to see how it could fit into their operation and their carrying capacity. They have also stopped expanding their quota holdings, and they have developed a clear business focus. “Our goal now is to get better, more efficient and pay off debt,” says Jan. This shift isn’t only because of potential changes to supply management, but it’s also linked to career timing and succession. They don’t want to saddle the next generation with a high debt load. Jan and Tracy have four children, with the oldest being 17 years old and the youngest eight. Jan says paying off debt now should help the generational transition, or at least put them in a better position to do it.

Increased efficiency and lower debt will also aid succession, say Jan and Tracy Bassa, here with oldest son Derrick.

This is a big change in thinking from 2009 when they doubled their herd and put in a 50-cow rotary milking parlour while also doubling their barn space and manure storage. Now they’re focused on investments to maintain and improve their farm, not expand. For example, they’re investigating manure separators. They’re also closely watching their cost of production, with the goal to fill their quota as efficiently as possible. “The price of milk isn’t likely to increase going forward,” says Jan. “We have to be able to produce more for less.” The trend in the milk price (called the P5 pool price) was generally up until mid-2014, and it was much easier to cover cost of production back then. Then it dropped steadily into the summer of 2015 before starting to claw back upward in late 2015. Outside analysts now predict some stability. “I expect the industrial price to stay in the $70 to $75 range in 2016,” says FCC chief economist, J.P. Gervais. “The outcome of current negotiations around a national dairy ingredient strategy could obviously change all of that.” The Bassas look to improve their forage quality and to buy less feed. Currently their farm spends $800,000 to $900,000 a year on feed. Instead of buying all their protein and grain corn, they’re going to grow more of it. They’re also using options to lock in feed costs, says Jan. “We are focusing on the details, trying to manage the tighter margins.” For a decade after TPP comes into force, Agriculture and Agri-food Canada’s Quota Value Guarantee Program will ensure any farmer selling quota will be eligible to receive payments under the Quota Value Guarantee program; $1.5 billion has been set aside for this demanddriven program. Jan isn’t greatly concerned about the decrease in quota values or the loss of 3.25 per cent market share negotiated away during TPP. He thinks the supply impact of these additional imports will be leveled out by

improved rules and policing at the borders for products being illegally imported now. However, he’s concerned that the trend toward eroding dairy tariffs might be like a small leak in a dike. Under the Comprehensive Economic and Trade Agreement (CETA), the specialty cheese market was opened in exchange for more open beef trade. “The 15 years isn’t my concern. It’s what’s coming,” says Jan. “Once they get a foot in the door, what’s next?” Jan thinks their farm could compete without supply management. “There will always be farmers,” he says. “It depends on how they’re financially situated when and if supply management disappears. How much debt could they carry, how many families are they supporting? How much does their infrastructure cost? How low are their milk production costs?” The EU got rid of dairy quotas in April 2015. In parts of Europe, such as France and the U.K., the dairy farmers are reeling right now with the reality of ending their dairy quota system after a 13-year transition. Jan keeps in touch with a former neighbour from Holland who is about the same age and who dairy farms now without quota. That farmer has had to increase production more than 20 per cent to maintain the same income. “He says things are very tight with the lower milk prices, they’re getting about half of what they did a year ago,” says Jan. “Yet the price in the stores didn’t go down.” Meanwhile, Jan has his own eyes on the processing and marketing sector, for a different reason. In Western Canada, processor reinvestment is a concern, Jan says. Sitting on the provincial milk board for four years has given him additional insight and a biggerpicture perspective into the milk industry. “There’s more pressure on the processors,” he says. “Dairy farmers have to work together with processors, so they make investments in plants, like we’ve invested in our farms.” Continued on page 30

Australia feeling the squeeze Economists have a term for it. They call it “power asymmetry” when others in the supply chain, including processors, supermarkets and myriad people in the middle have more influence on consumer prices than farmers. Country Guide spoke to Bruce Muirhead, associate vice-president of external research at the University of Waterloo from Queensland, Australia where he’s

interviewing farmers. Australia moved toward a free market system a couple of decades ago. Muirhead says the power asymmetry and low world milk prices are concentrating the dairy industry in Australia, squeezing it geographically. Only two main supermarkets dominate the country and most of the processors and dairy farms are in the southern state of Victoria. 1,560 dairy farmers were in Queensland in 2000 and now there are about 450.

“Two supermarkets, Coles and Woolworths, control about 70 per cent of grocery sales in the country and they have driven farmers to the brink. There is not really any intermediary between the farmer and retailers here,” says Muirhead. “Dairy farmers in Queensland are absolutely reeling. They cannot compete against the power of multinational supermarkets or in so-called free market arenas.”

COUNTRY-GUIDE.CA / MARCH 29, 2016

FEAture

Take it public Kevin MacLean wants consumers and politicians to know how valuable supply management is for Canada

or Kevin MacLean, the cost of quota is just part of being in a business he loves. “I’ve never seen quota as a risk. Just like you need land to crop, you need quota to dairy farm. It’s a long-term investment.” MacLean echoes a sentiment sometimes heard in country circles. There are two things you never hear a farmer say, he says. “I wish I hadn’t bought quota, and I wish I had never tile drained that field.” Near Napanee, Ont., which means he’s only about an hour north of the New York state border, MacLean milks 120 cows three times a day in partnership with his parents Barton and Barbara, and they own 150 kg of quota and 750 acres. In 1997, when he started farming, their 55 kg of quota was worth about $17,000/kg and it took about 60 cows to fill it. In 2004, they built a new barn and bought more quota ranging from $25,000/kg up to $30,000/kg. Today, 30

MARCH 29, 2016 / COUNTRY-GUIDE.CA

they have twice the number of cows but produce enough milk to fill almost three times as much quota. Yet for MacLean, 2015 was a balancing act, both with his budgets and in the barn. The blend price has been about 10 per cent lower in the last year, and with 25 per cent of his milk price now based on world milk values, his prices do fluctuate. But on his farm they’ve also seen a 10 per cent increase in quota production capacity, thanks to quota allocation increases in the spring of 2015 and the incentive days added during the summer and fall. Since their barns were at maximum cow capacity already, they went to milking three times a day, which increased production by the 15 to 20 per cent needed to take advantage of this extra quota volume. The other option would have been to increase cow numbers, but after housing and milking a neighbour’s cows following a barn fire, MacLean saw the impact of cramming more cows into his barn space. So he knew 10 per cent more cows would have required investing in barn infrastructure. “Now we’re able to fill incentives and make up for lost revenues,” says MacLean. “I want to get better instead of bigger.” Instead he’s using his debt carrying capacity for other parts of the farm, like buying land. As part of an on-

“I want to get better instead of bigger,” says Kevin MacLean, farming an hour north of the New York State border.

going attempt to improve margins, they also invested in a soybean roaster and an automated feed pusher. Now they can roast and feed their own soybeans, instead of trucking them away and buying back expensive protein supplement, and paying for all of the movement and steps in between. Next year, MacLean plans to do some custom roasting for other farmers in their area, but even without that they can cash-flow the investment. In 2014, MacLean was in the ninth annual Faces of Farming calendar, published by Farm & Food Care Ontario. “We (farmers) need to promote ourselves, in whatever we do — on our vehicles, in the media, and in every conversation. It needs to be part of our job.” Their family proactively reaches out by hosting open houses. A few years ago they had Christmas with the Cows, inviting the public to see a milking during the Christmas holidays. The event was so popular they opened the barn doors again during March break the following year. “Society wants to see where their food is coming from,” says MacLean. “They want community-minded smaller family-run farms producing their food.” So when the TPP negotiations were hitting the press

Dairy in Canada by the numbers

$6.07 $17.3 BILLION BILLION TOTAL NET RECEIPTS

Dairy manufacturing shipments

78.3 MILLION HECTALITRES

Continued on page 32

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consumption

FEAture with the debate over supply management, the local milk committee organized an open house event on his farm inviting the public, media, and the local MP. For added punch, they lined the driveway with signs of the various local businesses servicing their farm. Although we can’t control what politicians are going to do, we can keep in touch and keep telling our story to the public, says MacLean. The sign at the end of their farm lane reads: “Proud to produce quality milk for Canadian Families.” But MacLean adds that we have to be able to do it profitably and sustainably. Pointing south, MacLean says their farm could compete with U.S. farmers if we had an even playing field. Equipment, facilities, hydro, employee costs, and taxes — all these add to cost of production and are much higher in Canada. In dairy, the two largest expenses are feed and labour. The MacLeans hire three part-time and one full-time staff. MacLean says they try to make it a good

MARCH 29, 2016 / COUNTRY-GUIDE.CA

place to work, not where tight margins make for poor working conditions. “We have to pay our employees equitably so we can attract passionate employees who enjoy the job,” he says. Like Jan Bassa (see “Focus on Efficiency”), MacLean is concerned our Can adian processors haven’t kept up. For example, about 15 years ago he went on an agricultural tour in the U.S. and saw a dairy processor making protein power drinks and supplements from milk protein isolates. “I thought, why aren’t the processors doing that at home? Now, they’re still saying it’s three years away,” says MacLean, referring to the promise of new infrastructure being built with the Dairy Farmers of Ontario’s new ingredients strategy. “We are losing opportunities every day.” He’s keeping a close eye on how the boards are dealing with non-fat components of milk. “Our ingredient strategy needs to be a national vision,” says MacLean. CG

Canadians want to feel good about their farmers, Kevin MacLean says. “They want community-minded smaller family-run farms producing their food.”

PG. 36 Is malting barley a better bet post-CWB? PG. 38 Brewers asked to buy high-yield varieties PG. 42 Here’s help to cut canola shatter losses

Kinze’s multihybrid planter allows farmers to switch between two hybrids in the field based on a prescription map.

CROPS GUIDE

High-tech

seeding

By Gord Gilmour / CG Associate editor

New equipment options promise growers more and better control over this critical field operation

ver the years, few field operations have caused growers more head scratching. Seeding is the critical first step in getting a good crop, and there are many variables in play. Is the seedbed right? Are the fertilizer and seed separation acceptable? Is the seed placed evenly? Is it being sown at the right depth? As equipment becomes more complex and the demand for precision grows, another fact is emerg-

ing clearly. High-tech seeders are going to be the heart of the move to zone management, variable rates and other techniques that promise lower inputs, better crops and environmental benefits. This has naturally translated into a lot of interest by equipment manufacturers, and innovative new designs and strategies to address this growing need. In this issue Country Guide has spoken to the manufacturer with some of the most promising new technology to

see what’s arriving in the field today and what it can do for growers. Get SMART Where most farm machiner y companies are adding precision agriculture technology to established designs like large air seeders, CleanSeed’s SMART Seeder started with a blank slate and came up with a design for this new way of farming, says Saskatchewan farmer and company vice-president Colin Rosengren. Continued on page 34

COUNTRY-GUIDE.CA / MARCH 29, 2016

crops Guide

Different delivery system It makes the carts relatively cheap, and another design wrinkle further aids logistics. They’re designed to be filled in the farmyard, hauled out 34

to the field using a highway tractor, and the seeder itself just hooks up to them. It minimizes downtime for refilling, and addresses the reality that in some years, especially wet ones, there might not be a good spot in every field to set up the refill system. Rosengren’s own operation incorporates numerous crops, intersown crops and multiple fertility blends. “On our farm we set the logistical bar pretty high,” Rosengren says. “I like to think those challenges helped us design something that addresses those challenges.” The gravity-fed planters also offer another key difference from traditional air seeders. Those implements are really good at getting a lot of seed into the ground relatively quickly, but have always struggled with accurate seed placement and spacing. “This system really combines the best of both worlds, giving you accurate placement but with the same ability to handle a lot of seed and product fairly quickly,” Rosengren says. In addition, a unique in-ground system provides better fertilizer separation, incorporates a bit of vertical tillage, and leaves the seeds in a mellow unpacked seed row that enables both better water infiltration and drainage and gets tender seedlings off to a better start, the company says. “We’re quite excited about our in-ground system, and how it provides better conditions for the seed,

MARCH 29, 2016 / COUNTRY-GUIDE.CA

and doesn’t create that hard-packed layer right below the seed,” Rosengren says. The system was prototyped and field tested last season. This winter CleanSeed partnered with a Manitoba-based manufacturer with farm equipment experience to produce the first three production models for this spring. Cut the wire One of the perennial complaints about the high-tech monitors and controls for modern farm equipment has long been the spools of wire and complex cab-mounted controllers. In many ways they’ve been seen as a necessary evil, but one company thinks there’s a better way — a way built on the burgeoning consumer technology that’s all around us. Langbank, Saskatchewan’s Seed Hawk Inc. — now a member of the global Väderstad group of companies based in Sweden — recently introduced its wireless iCon control system based, as you might guess from the name, on the Apple iPad platform and using a custom-built app to control the equipment wirelessly. Edward Lambert, Seed Hawk’s head of research and development, says there were a lot of compelling reasons to make this jump, something that’s comparable to the leapfrogging of wired telephone infrastructure by cellphones in developing nations.

Each of CleanSeed’s SMART Seeder tanks can be individually adjusted on the fly to create tailored applications almost down to the individual plant level.

Photo: CleanSeed

The company designed a unique hybrid of an air seeder and gravityfed planter that uses air to move the seed and product from bulk tanks to small gravity-fed seeders that look a lot more like a traditional corn planter, with a high-tech difference. Each can be individually adjusted on the fly to create tailored applications almost down to the individual plant level, using up to six different products. “Right now when we talk about precision agriculture, we’re going out and painting with an 80-foot paintbrush,” says Rosengren. “That’s not precise enough, you might be giving a better prescription to maybe 10 per cent of the acres you cover.” It’s like traditional agriculture takes a 30,000-foot view, and what most of us think of as precision agriculture might be a 3,000-foot view. This takes the view down to 30 feet, Rosengren explains, noting that to really capture the full value of precision agriculture, that level of fine control will be necessary. He also notes precision agriculture comes with logistical challenges that the new technology addresses. While many growers concede that more precision would be a good idea, they struggle with the reality of managing multiple fertilizer blends, for example, during a very short seeding season. Here the solution again takes advantage of the unique design. If the seeding units are “smart” the carts are, relatively speaking, “dumb.” “They don’t have metering or controls or anything like that, they’re very simple, and the blend is created at the planter,” Rosengren explains. “The fact they’re cheaper than other carts makes having more of them, for multiple blends or transportation and logistics simplicity, more affordable.”

crop technology

Photo: seedhawk

Rather than developing its own control system, Seed Hawk uses an iPad for its wireless iCon seeding system.

“It really saves us a lot of effort and expense not developing a new operating platform, but basing it on the iPad,” Lambert explains. “It’s something most people are using these days, they’re familiar with it and the interface is very easy for people to understand.” In fact, in a funny way, it might seem a bit too simple, causing some users to assume they already know how to run it. “One of our problems has actually been people foregoing reading the directions because it seems very straightforward to them,” Lambert says. In addition to using a readily available and understood technology, it can leverage the functionality of the iPad for greater convenience for farmers. For example, if farmers want to test calibration of a meter or make fine adjustments, they can take the iPad with them to the precision meters. It’s linked wirelessly to the control mechanisms on the seeder using the device’s built-in bluetooth connection, allowing them to carry the controller back to the machine instead of shuttling endlessly between the machine and the tractor cab. “We think this is a real convenience for farmers,” Lambert says. “Not only will it save them a lot of time running back and forth, it also lets them do adjustments by themselves that would otherwise take two people.”

The elevated computing power also allows the machines to do more. It can use prescription maps to control application rates, generate as-applied field maps, show real-time job progress and allow for simple in-field calibration. The system also has automatic and manual control options that can turn sections of the seeder on and off, blockage monitors for all runs and a unique “fit-to-field” mode that can empty the tank over the remaining acres in a field. “That feature is a real conven ience to growers who want to be able to make quick changeovers between fields,” Lambert says. All in all Lambert says just a few simple words sum up the design approach: “It’s very user-friendly.” Doubling down There’s little doubt that variety and hybrid selection can make a big difference for growers. Various options are frequently well adapted to different conditions and less well adapted to others — conditions that can frequently exist in the same field. That’s the reality that has led Kinze to develop its multi-hybrid planter, a bulk-fill planter with dual meters that allows farmers to switch between two hybrids in the field based on a prescription map, says Phil Jennings, the company’s service manager. “Farmers have told us they want the ability to switch back and forth between varieties or hybrids without stopping,” Jennings says. “They know their different management zones, and that they’ll perform best with different hybrids.” In corn in the U.S. the technique has delivered about 7.9 bushels an acre higher yield, according to an independent study by Beck’s Hybrids. “We feel this technology has a very attractive return on investment,” Jennings says. Agriculture media reports in the U.S. peg the cost at around $30,000 more than a comparable planter without multi-hybrid capabilities. Jennings says growers typically set zones using several different cri-

teria. Some use soil types, others are looking at fertility levels and others are interested in historical yield patterns. “They’re basing their zone maps on the factors they feel are most important for their individual farms,” Jennings says. Offence and defence When it comes to hybrid selection, the strategy is framed in terms of “offensive” and “defensive” hybrids, with attention paid to finding two with matching maturity. An offensive hybrid is one that will take advantage of optimal conditions to maximize production, but which falls off in parts of the field that are less productive or under stressful conditions. A defensive hybrid is the opposite side of that coin — it performs well under stress or in less-than-optimal conditions, but won’t perform as well under optimal conditions. Fields are also said to have a certain amount of “middle ground” that’s neither peak potential or less productive, causing a fair bit of head scratching about which hybrid to plant there. One strategy U.S. growers are using is to look at the field on an overall basis, and if they consider it to be above average, the middle ground gets the offensive hybrid, and lower-than-average fields play defence on the middle ground. Jennings expects growers will seek more and more of this sort of technology as the true potential of zone management becomes apparent. “I don’t think we’re going to see anything but more precision and more call for this sort of technology over time,” he says. Kinze uses Raven controllers to run the dual-metering system on the planter, and the meters are driven by 24-volt electric motors, which allows for instant start-stops and also gives row by row control, which allows for features like curve compensation for turns. CG

COUNTRY-GUIDE.CA / MARCH 29, 2016

crops Guide

The malting lottery continues Having barley accepted for malting has never been a sure thing, and that’s still the case following changes to the marketing system

By richard kamchen

alting barley can be one of the most profitable crops in Western Canada — if you can grow it, and if you can

sell it. That’s not necessarily easy. Many farmers try — it’s estimated that 80 per cent of the barley sown in Western Canada is seeded to malting varieties. But only about 20 to 30 per cent of that is accepted for malting. While there are high quality requirements for malting barley, there isn’t an official grade with standards set by the Canadian Grain Commission. The standards, the decision to purchase, and the price are all up to the buyer. The first two conditions also applied when malting barley was controlled by the Canadian Wheat Board, but the board required that all malting barley be sourced directly from producers, and it set the price at whatever premium it could over feed barley. Now maltsters or selectors can source barley from anywhere they find it, and at whatever price individual sellers are prepared to accept. The change to an open market has altered the dynamic for both buyers and sellers.

Bob Sutton of Rahr Malting says contracting provides maltsters with more assurance of supply.

March 29, 2016 / COUNTRY-GUIDE.CA

“Absolutely now there’s more contracting directly with producers in the post-wheat board era, particularly on the part of maltsters, but grain companies are contracting as well,” says Peter Watts, managing director of the Canadian Malting Barley Technical Centre. “I would say the biggest change is there’s been a much greater move to production contracts and deferred delivery contracts,” adds Lorelle Selinger, North American merchandising manager at Cargill. Bob Sutton, commercial vice-president of Rahr Malting Co., says companies like his have the opportunity to secure their barley supplies prior to seeding while farmers are able to secure pricing on their crop before they plant it in the ground. “It’s a level of planning that neither of us had the opportunity for before,” Sutton says. Rahr has a facility in Alix, Alta. that runs at capacity and the company needs to ensure it has the barley to feed its plant, Sutton says. Brian Otto, chairman of the Barley Council of Canada, likes the open market and says 75 per cent of his barley is typically priced before harvest.

“I know what the price is,” he says. “I’d much rather have control of how I price my crops in my hands, and I know exactly what I’m getting paid for.” Mixed views Otto says the new system means farmers know where their barley is going and malt companies know where their supplies are coming from. And producers make the decision and accept the risk of when to price their barley. “What we do is we’ll contract so many tonnes of barley with a malt company — or you may deal with more than one — and they’ll offer prices for malt barley from now till they have enough barley contracted for their customers. And you can price into those. Say it’s $5.50 now, it might be $5.75 in two months, or it might be $5.40 in two months. So you as a producer have to decide when you want to price your barley.” Saskatchewan Barley Development Commission director Allen Kuhlmann isn’t as enthusiastic. “They buy it all when they can and call it forward as they need it, and the farmer stores it until such time as the maltster says

malting barley

Photo: Chris Procaylo

Canadian Malting Barley Technical Centre managing director Peter Watts with a sample of two types of malt. Watts says the craft brewing industry has different requirements than some of the bigger brewing companies.

‘bring it forward.’ And he isn’t paid for that storage in most cases,” says the Vanguard, Sask. grower. Otto praises malt barley contracts for containing an Act of God clause that allows farmers out of their deals if weather events make their barley unacceptable for malt, but Kuhlmann insists the contracts don’t exist to protect the farmer, who can be hit with discounts depending on what’s getting accepted that year. “The malt specs, I don’t think you’d say they’re standard, they’re somewhat standard — 95 per cent germination, for instance, is important, and if it’s below that, I suspect only in a very bad year do they accept it. But you could end up with a spec that’s a little below and they might eat it, but there will be a discount for that.” The same holds true for chitted or sprouted barley, and if it’s not at the best end of an accepted range, a discount may be applied as well, Kuhlmann says. He says the contracts can be difficult to decipher, especially given the legalese of the fine print, and that it’s difficult for producers to run all their contracts by a lawyer. “It’s a lot harder than it used to be…

I think producers have very little market power at this point. Nobody’s sticking up for the farmers’ rights except themselves. You can like or dislike the wheat board, but you did know whose side they were on,” Kuhlmann says. He also says malt premiums over feed are another concern. “There are going to be instances where feed barley is going to be priced fairly close to malt barley and that happens; that’s just the way the marketplace works,” Otto says. “But certainly right now you’re seeing malt barley premiums are very attractive over feed barley prices.” Cargill’s Selinger says that because of tight supplies, the spread between feed and malt has widened above historical averages. “If a farmer can get malt, it’s a very profitable crop to grow.” Kuhlmann, however, thinks the premiums are typically mostly discouraging. “Last spring, when I was signing a contract for malt barley, I was being offered $5.75 if it met the spec., and I was getting $5.50 for feed barley,” Kuhlmann says. “So is there enough premium in that case? Absolutely not.” CG

They buy it all when they can and call it forward as they need it, and the farmer stores it until such time as the maltster says ‘bring it forward.’ And he isn’t paid for that storage in most cases.” Allen Kuhlmann, Saskatchewan Barley Development Commission

COUNTRY-GUIDE.CA / March 29, 2016

crops Guide

Chicken and egg Maltsters will buy new barley varieties if farmers will grow them. Farmers will grow them if maltsters will buy them By richard kamchen

hen ordering a beer these days, your choice is no longer just a couple of sametasting brands from big national or international breweries. North Americans have developed a taste for “craft” beers from an ever-expanding list of smaller breweries. Different beers need different malts, which creates a demand for different varieties of malting barley. But it can be a challenge for growers to connect with that demand. Large brewers have traditionally taken an “If it ain’t broke, don’t fix it” attitude to buying malt. When they find a variety that works, they like to stick with it. But while it might perform well in a brewery, after a few years an older variety may not perform so well in the field. There may be new varieties that are better agronomically, but growers are reluctant to try them without guarantee of a market.

MARCH 29, 2016 / COUNTRY-GUIDE.CA

Metcalfe. Metcalfe’s been out there for a long time.” Otto says the barley council is working with the industry in an effort to get newer varieties recognized for their benefits and up higher on the demand list, but it’s a slow process. That said, some customers are looking at varieties such as AAC Synergy becoming the replacement for some of the mainstream Metcalfe market demand, while companies like Anheuser-Busch in the U.S. are replacing Metcalfe with some of their own newer varieties, says Michael Brophy, president

Different beers need different malts, which creates a demand for different varieties of malting barley.

photo: thinkstock

Metcalfe and Copeland dominate The Canadian Malting Barley Technical Centre (CMBTC) recently issued its list of recommended varieties for 2016-17, with CDC Copeland and AC Metcalfe once again the highest recommended varieties. “In a normal year, just under 70 per cent of the malting barley that’s accepted will be one of two varieties, Metcalfe being the biggest and oldest, and Copeland being the second biggest and a bit newer but not very new,” says Allen Kuhlmann, a director with the Saskatchewan Barley Development Commission. “There’s an old, old variety called Harrington and still three or four per cent of the barley grown is Harrington.” “We hung on to the Harrington variety for years,” says Barley Council of Canada chairman Brian Otto. “There were better varieties out there, but the customers still wanted Harrington barley. We have some customers who still like Metcalfe barley, but there are newer varieties than

malting barley If you’re a Labatt’s or Molson’s, you want the same basic malt at all of your plants across Canada.” Bob Sutton

and CEO of the Brewing and Malting Barley Research Institute (BMBRI). “So the change is already actively happening,” Brophy says. “Growers should talk to their local merchant or malting company about these trends and demand opportunities for new varieties in making their related seeding decisions for 2016.” The recommended list CMBTC also listed CDC Meredith, Bentley, CDC PolarStar, Newdale and Merit 57 on its two-row variety list, but noted they have limited demand.

CDC Kindersley and Synergy are under commercial market development with “growing demand,” CMBTC says. “Meredith is considerably better agronomically, and it’s quite new, but (last year) maltsters were paying less money for Meredith by a significant amount than for the other two varieties,” Kuhlmann says. “If you want to promote a new variety, you must not pay a discount, you’ve got to pay the same or better or it isn’t going to happen.” Farmers, maltsters, brewers and commercial grain companies buying for export need to work together to encourage planting of newer varieties, says Cargill’s North American merchandising manager Lorelle Selinger. “You can’t integrate it overnight, but obviously we all want to push varieties that are going to yield higher and create better returns for the growers,” she says. But, like CMBTC and BMBRI, Selinger also recommends growers consult with potential buyers before planting varieties with limited demand. Bob Sutton, commercial vice-president of Rahr Malting Co., says buyer uptake on new varieties was even worse before the rise of craft brewers. “If you’re a Labatt’s or Molson’s, you want the same basic malt at all of your plants across Canada,” Sutton says. “With craft brewers, they are much more flexible.” Chicken and egg For the big brewers, the traditional problem has been quantity. They can’t gradually accept a new variety because they require a guaranteed large supply. But farmers don’t want to grow without an assured market. The emergence of craft brewers may help break the impasse. “Because they are individuals, it can be one or two or three craft brewers in the beginning, and then as the availability of the barley grows, you get more and more acceptance of it. And then when it gets to a large enough scale, then the larger brewers can get into it,” Sutton says. “The opportunity is now better to ramp up the supply gradually rather than having to go from zero to 60 overnight. Nobody was willing to take that risk. Now it’s much easier.” Seed supply is another challenge for introducing a new variety. The more malt trials conducted on the seed as it’s developed, the less supply there is available for multiplication in subsequent years. “So you’ve got two things going on at continued on page 40

COUNTRY-GUIDE.CA / MARCH 29, 2016

crops Guide

CANADIAN BARLEY 2014 TOTAL OUTPUT

7.1 8.2

MILLION TONNES

2015 TOTAL OUTPUT

MILLION TONNES

once: you have to multiply the seed so there is a supply available, but you also need to be making malt and getting that to brewers for testing at the same time. It’s an interesting process. But I’d say it’s better now with the advent of the craft brewers than it was when there was basically a duopoly,” Sutton says. Craft breweries have taken off in Canada over the last 25 years. At last spring’s GrainWorld conference, Selinger said that there were over 4,000 registered craft breweries now versus about 400 in 1990. And whereas the average commercial beer will contain 40 to 50 per cent malt content, a typical craft beer will have 90 to 100 per cent. “That’s really a bright spot from the perspective of farmers,” says Kuhlmann, adding craft brewers are more open to experimentation and taking new varieties. But CMBTC managing director Peter Watts points out that compared to the bigger brewing companies, craft brewers have different requirements, such as lower protein and lower enzymatic activity. Selinger notes craft brewers are more particular about quality too. With the large mainstream brewers, a brewer may never actually physically see the malt. But craft brewers are looking at their malt one bag at a time. “A craft brewer typically will have his hand in the malt and be chewing it as he’s working with it, and it brings a whole new level of quality determination,” Sutton says. Current Canadian varieties like Copeland, Meredith and Bentley are already being supplied to the craft brewing industry, adds Brophy. “Some of the recently registered new Canadian varieties with lower protein and more moderate enzymes are specifically aimed at the needs of the craft sector,” he says. “Other breeding lines at an advanced stage of pre-registration testing are also aimed at satisfying the quality needs of the craft sector.” Brophy stresses these newer varieties aren’t all the same and have been bred to satisfy different malt and brewing customer specs. Customers looking for higher enzyme may look at Kindersley, while customers seeking moderate to lower enzyme may consider varieties like Bentley. Yield boost Greater demand from craft brewers is good news for producers who want to grow newer varieties that offer better yields. Brophy says new varieties like Bentley

MARCH 29, 2016 / COUNTRY-GUIDE.CA

and Synergy are 13 per cent to 15 per cent higher yielding than Metcalfe, which itself is seven per cent higher yielding than Harrington. “So over a 20-year period we have seen our breeders produce about a 20 per cent yield increase in malting barley varieties,” says Brophy, calling it a pretty good performance relative to other crops. “That is why growers want to grow the new varieties, provided there is market demand. I would hope that within the next five years, a couple of the higher-yielding new varieties will supersede Metcalfe, which will in turn drive up overall average barley yields.” Brophy would also like to see new replacements for Metcalfe get promoted to and be accepted by offshore customers for bulk malting barley, as this also represents a large portion of demand. More acres would also be good news for buyers who have watched production shrink over the years. “Supplies are very tight,” says Cargill’s Selinger. “We had a very low carry-in into this crop, and as quality is not spectacular, it’s going to be tight again.” Although Canadian barley output rose to 8.2 million tonnes in 2015 from 7.1 million a year ago, it’s still well off from when farmers routinely produced double that. Yield improvements for both malting and feed varieties have lagged other crops. The 2011-15 prairie average yield was 63 bushels per acre, 16.2 per cent higher than the 1991-95 average. For the same periods, spring wheat average yields were up 42 per cent and oats 36.4 per cent. Otto, however, is optimistic production will grow. “We’re averaging right now around 6.8 and seven million acres. We have been as high as 14.1 million acres. I think what the industry would be looking for in the near future is to get in around nine to 10 million acres of barley in Western Canada, and I think we can do that,” he says, pointing out barley is cheaper to grow than canola and high-protein durum. “What we’ve seen in the past two years is malting barley has come out as one of the most best return crops per acre and will be again this year, so that’s driving more seeded area,” adds Watts. “Given that the returns for malting barley continue to be among some of the best of all crops to grow in Western Canada, I think we’ll see malting barley increase again this year. There’s good demand for the malt barley; that’s why prices are good.” CG

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crops Guide

Shatter losses in straight-cut canola PAMI research funded by WGRF shows that the type of header makes a difference By Claire Stanfield / For WGRF

MARCH 29, 2016 / COUNTRY-GUIDE.CA

Foundation (WGRF), which is helping to fund the study. And as the popularity of straight-cutting canola continues to rise with farmers who want to save time, increase yields and protect crop quality, helping them understand how their equipment can work for (or against) those goals is becoming more important. “We want to provide information so famers can make some decisions about their equipment,” says Gregg. Are there any adjustments, add-ons or modifications they can make to their existing header that will reduce shatter losses? The idea, he says, is to allow farmers to make the most of straight cutting without necessarily having to buy a whole new header. Trends worth watching Since minimal public research on this had yet been done, very little was known about the precise impact of header equipment on pod shattering and the first year of the study, 2014, was designed to establish some benchmarks. Four different equipment configurations (known as treatments) were used on two different canola varieties — a shatter-resistant hybrid and a regular hybrid — on

Photo: PAMI

alfway through a study examining the role that harvest equipment plays in shatter losses when straight-cutting canola, Nathan Gregg is noticing some trends. “We saw higher losses out at the edges of headers,” says Gregg, a project manager with the Prairie Agricultural Machinery Institute (PAMI) in Humboldt, Sask. “And losses dropped off as you moved toward the centre of the header, then they crept up again towards the middle.” Maybe that’s not too surprising when you consider the “violence” experienced with most combine headers as they move crop material laterally to the centre where it all converges into the combine feeder house. But Gregg and his team wanted to know more — such as how far from the header ends were losses happening, does the type of divider make a difference, does the type of header itself make a difference, can some losses be recovered? The three-year research project led by PAMI was launched in 2014 and is a collaborative effort by many parties with an interest in finding answers to some of these questions, including Western Grains Research

PAMI researchers placed shatterloss collection pans throughout the fields along the width of the headers. The contents were cleaned and weighed to find out where losses were occurring.

wgrf two field sites (Indian Head and Swift Current). The check treatment was swathing, and the straight-cutting treatments were a draper header, a rigid auger header and a European header with an extendable cutter bar. Researchers worked on a field scale using 35- and 36-foot headers, so this is definitely not small-plot work. And to make sure that apples were being compared to apples, all treatments were identical — everything stayed the same during harvest, from driving speed to reel, knife and threshing speeds. Shatter-loss collection pans were distributed throughout the fields along the width of the headers and the contents cleaned and weighed to find out where losses were occurring and to what degree. Gregg reminds growers the study is not just about yield differences, but also header loss differences. “After two years, we are still seeing that there’s no runaway winner among the headers as far a yield goes,” he says, although he will say that, for the straight-cutting treatments, shatter-resistant hybrids consistently outperform the regular hybrids. “We have data to show shatter-resistant technology works. But we are starting to see a few trends with header losses, too.” Across all headers For example, in 2014, the collection pans revealed a loss pattern across all headers. This is the pattern already mentioned, starting at the outer portions of the headers with relatively high losses that moderate as you move inward, and then pick up again near the header’s middle. To get more specific information about those losses and what was causing them, the team did some more intensive sampling with the collection pans in 2015. “We collected in fewer field locations but with a higher intensity of pans across the header,” says Gregg. “What we found bore out the trend of losses happening at the edges, but we now see those losses are extending a few feet from the end rather than just right at it. So we looked closer at the divider. We used an active divider on all treatments, and we wondered if that was contributing to loss rather than preventing it.” To test that theory, the team needed to compare powered-knife dividers to static ones, and they couldn’t do that within the experiment’s current configuration because everything had to remain equal for the results to be meaningful. Luckily, another seed company came on board in 2015, and Gregg’s team was able to set up a third site to do the kind of testing needed to answer questions like this. “We found the fixed divider showed potentially lower losses,” says Gregg. “But that was only on one side of the header. On the other side, where the knife drive is, there was higher loss.” He points out that losses were lower on the sleek, smooth side with the narrow divider. “What it says is that it may be worth your time and money to smooth the blunt and rougher edges of dividers” And the powered dividers? “We found a rotary divider results in high shatter losses and, not only that, but the losses were spread out over a wider area, whereas a vertical knife showed less loss, and not spread as far,” he says. He notes that powered dividers, especially the rotary ones, are common on windrowers on the Prairies because they allow better forward progress in green, tough, interconnected crop conditions. “But in dry crop conditions, like standing matured canola, is this divider creating loss rather than preventing it?” Gregg says that thus far the active dividers have not been necessary to effectively divide the crop canopy during straight-cut harvest

In mature canola, powered dividers may actually contribute to field loss rather than prevent it. Rotary dividers in particular were linked to higher shatter losses

operations, unlike when dividing greener plant material while windrowing. Back in the two main field sites, researchers wondered why shatter loss increased at the centre of the header. “And does that loss go out the front of the header or is it the stuff landing on the feeder house?” Gregg asks. The team found that a good portion of the losses from the centre are, in fact, spit forward and that one header type, the European style, seems to be better equipped to deal with that. “When the extendable knife is extended all the way forward, it’s retaining those potential losses.” There is still a long way to go and many variables to experiment with as the third and final year of the study approaches. “We’ve used fixed combine settings and speeds across all the treatments so far,” says Gregg. “We want to push the envelope a bit and see if there are differences with speeds. Anecdotally, people say they can go faster when straight cutting, while others say they need to go slower. We do think the extendable cutter bar can minimize losses compared to the other treatments, but will this hold at faster speeds?” He certainly aims to find out. The team is also considering looking into whether or not desiccation, or a similar harvest aid, contributes to shatter losses, and if the trade-off for evening out or accelerating crop maturity is acturally worthwhile. They’re also listening to farmers’ experiences and thinking about that as they refine the project’s design. For example, Gregg has heard some growers insist they can’t make any progress straight cutting without a cross auger on a draper header. “But we’ve never had ours be a critical factor in the four site-years of the study,” he says. “Maybe it goes back to speed and feed rate.” As yet another question is added to the mix, Gregg is confident that by the end of the study, his team will have some useful information for farmers wanting to straight cut canola more effectively. “Our goal is that farmers can look at our results and decide if they can try this with the equipment they’ve got or if the economics make sense for them to use a different header type.” CG WGRF is a farmer-funded and directed non-profit organization investing in agricultural research that benefits producers in Western Canada. 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 $14 million annually into variety development and field crop research. WGRF brings the research spending power of all farmers in Western Canada together, maximizing the returns they see from crop research.

COUNTRY-GUIDE.CA / MARCH 29, 2016

BUSINESS

International influence Farm machinery goes where politicians fear to tread

Above: The world’s largest farm machinery show, Agritechnica is held in Hanover, Germany, every second year. The next one is scheduled for November 2017.

Reinhard Grandke is CEO of DLG, the German Agricultural Society.

MARCH 29, 2016 / COUNTRY-GUIDE.CA

couple of interesting and poten tially surprising announce ments arose in January from DLG, the German Agricultural Society, which organizes the world’s largest farm machinery show called Agritechnica. First, DLG revealed it is creating an inde pendent subsidiary organization in Russia. Second, it announced it had reached an agreement with the Iranian Ministry of Agriculture to help improve farming in that country. The surprising part — to this writer, at least — is these two countries rank among the globe’s list of problem children. Making progress in any endeavour in these places isn’t likely to be easy. “I believe that by using our know-how not only in the field of trade fairs and field day events but also in machinery and food testing as well as in the training of farmers, we will be able to contribute to the develop ment of Iran’s agriculture,” said DLG pres ident Carl-Albrecht Bartmer in the press release announcing the partnership. Those announcements made me think back to a conversation I had with the CEO of DLG, Reinhard Grandke, in November

in the sunny International Visitors Lounge on the grounds of the last Agritechnica machinery show in Hanover, Germany. As we sipped our coffees, we talked about the unique structure and aims of DLG. “I think the concept of DLG, in Ger many, is really unique,” he said. “I don’t know of any comparable organization of this size with its core competencies.” And neither do I. It’s unlike any other farmer-focused group I know. As it has evolved, it has grown well beyond Germany’s borders, and every year it becomes a more prominent global clearing house for agri culture, focusing on the dissemination of knowledge. Grandke’s comments that day in Hanover help explain why the organization is willing to make the kind of bold moves it recently announced. “We’re a very strong organization, but we’re not strong enough to really influence world politics,” Grandke went on. “But I think agriculture is really every country’s base for development. Where we can, we help. We bring experts from machinery, but also from plant production and fertilization, and we try to start projects that offer the best solution for the region.” But the recent announcements of DLG’s outreach into countries that are gener ally difficult or impossible for others to get a foothold in may be proving Grandke wrong — in a way. By being apolitical and providing the basis for these countries to improve their economies, DLG might actu ally be flexing a kind of invisible political influence. Here’s what I mean: nothing ties people and nations together like economic interde pendence. Although the aim of the Iranian Ministry of Agriculture is to make the coun try a little more self-sufficient in agricultural production, anyone in the business these days knows maximizing farming produc tivity means taking advantage of the many kinds of inputs and machinery that are only available through international trade. To become more independent by producing their own grain and foodstuffs, countries must give up some of their independence by

Photos: DLG and Scott Garvey

By Scott Garvey / CG Machinery Editor

More than

450,000

PEOPLE FROM AROUND THE WORLD VISITED AGRITECHNICA 2015

adopting technologies and equipment from others. That’s how an isolated country begins to merge its economic prosperity with that of other nations. As the fortunes of those nations — and those of the influential people within them — become more economically intertwined with the rest of the world, they have a greater incentive to play nicely with others, so to speak. Realistically, no one believes all the extremism we see in Iran will just fade away over some improved wheat and barley production. But it could help tone down the hostility. “Normally, when we go into developing regions, it is with some initiative of the German government,” said Grandke. A friend of mine who works for DLG has actually been involved in creating relationships with people in Iran for a while now. She has been regularly travelling to that country to invite delegations from there to come to Agritechnica and participate in the ag knowledge-related activities that go on there. And the country’s leaders have responded to this approach, sending several representatives to the last couple of Agritechnica shows. These associations with Russia and Iran are far from the first time DLG has helped underdeveloped countries improve their agricultural bases. “We have a lot of experience in such projects,” said Grandke. “We did a real unique project in Turkey. Turkey was an emerging country. In 1985 we started a project there together with the German Ministry

of Agriculture. The main point of the project was to help farmers build self-help working groups.” And since Grandke has taken on the role of CEO, the organization’s international focus has grown significantly. “In 2002 when I started, I think we had two employees from abroad. Now we have 80 or 90 international employees. So at DLG we’ve improved our international view and possibilities.” This year DLG will also co-organize Iran’s Agrotech-Agropars International Trade Fair of Agricultural Technology, Specialty Crops, Fertilizers and Pesticides, Seeds and Irrigation. DLG also organizes a couple of farm shows in Russia: AgroTech Russia and AgroFarm. But Agritechnica remains by far DLG’s flagship event. “Agritechnica is very important because it’s the largest ag machinery show in the world,” said Grandke. “We organize about 30 different exhibitions now. But Agritechnica is the most important, not only for DLG but also for the industry because we have so many exhibitors from all over the world. We can demonstrate and create some impulse for business for the next year.” Since its rise to prominence, Agritechnica has changed the ag machinery industry. Companies now see it as a showcase they can’t afford to miss, and they often plan their most significant machinery introductions to coincide with the bi-annual event. Despite DLG’s participation in the German government’s foreign aid programs, which have helped it earn a global reputation, arguably it is Agritechnica that has put

DLG on the map as the major global player among agricultural associations. Farm machinery innovations on display there have been the lure to bring nearly half a million farmers and industry players together, giving manufacturers what they really want: a big audience and global publicity. While most farm groups have a national or even regional focus, which limits their scope, DLG, was originally created with a wider perspective in mind. “That comes from our founder, Max Eyth, because he was really international,” said Grandke. “He travelled all around the world to get ideas for the challenges facing agriculture. His idea was to build a platform, a non-profit society to improve progress in agriculture and food businesses. We are organized from farmers for farmers. We include the views from scientists and industry along with administration advisers.” But it may not be the views of scientists and industry people that will steer agriculture in the future as much as those of consumers and activists. Grandke thinks DLG’s ability to disseminate information may eventually need to be aimed toward society in general. “I think this will be one of the most important themes over the next 10 or 20 years, to find a new way of communication with society,” he said. “We work together with NGOs, but we also work together with farmers to support communication between them and society. We think the farmer is important and key to creating a positive image to society. We try to support the farmer to do this.” CG COUNTRY-GUIDE.CA / MARCH 29, 2016

business New names to follow

Hopes grow for gene editing This safe new technology promises to take us far beyond GMOs. But will consumers let us use it? By Gerald Pilger

new technology called gene editing promises to pick up where GMOs have fallen short. In other words, with gene editing, farmers and consumers may benefit as much as chemical and seed companies. But for that to happen, farmers must become familiar with this new technology, they must understand what it can offer agriculture and the general public, and then they must become proactive in communicating the potential benefits of gene editing before this incredible tool ends up hobbled by negative connotations, as happened with GMO. Traditionally, new crop varieties have been developed by crossing existing varieties and collecting the seeds of offspring which display the desired characteristics. But crossbreeding is slow and expensive, and the results are never guaranteed. Starting in the 1930s, plant breeders began using mutagenesis in plant breeding. This involves exposing seeds and plants to genedisrupting radiation or chemicals in the hopes of producing desirable mutations like bigger seeds, better oil or protein content, or other such factors. Again, however, success is random and time consuming. The biotech revolution of the 1990s was supposed to end all that. Science now had a method of introducing a desired trait by inserting the relevant genes from a different species that already has that trait. This opened up a whole new world of herbicide tolerance, pest tolerance, drought tolerance, frost tolerance, salt tolerance and much, much more. Sadly, most of the breeding effort went into herbicide tolerance and insect control (where farmers already had available management strategies) instead of qualities like drought tolerance. The reason was understandable. Biotech was hugely expensive, so companies focused research on the traits which offered the best and fastest returns. There was even more profit to be made if the genetic changes required the use of the products the company was already marketing. But thereâ€™s another downside too. Many consumers fear transgenics. continued on page 48

MARCH 29, 2016 / COUNTRY-GUIDE.CA

Below are a few of the companies in the lead with gene editing technology in agriculture: Calyxt: This Minnesota company (previously Cellectis Plant Sciences Inc.) focuses on the creation of healthier crop products. It is currently working on developing high-oleic/ low trans-fat soybean oil, cold storable potatoes, gluten-reduced wheat, and low saturated fat canola oils. Partnering with Calyxt in gene editing and crop research and development are a number of major agricultural and food industry companies including Plant Bioscience Limited, U.K. Calyxt is also collaborating with with the University of Minnesota, Bayer Cropscience, Limagrain, Sesvanderhave, and INRA Science and Impact. Previously, the company had signed agreements with Bayer Cropscience allowing Bayer to use the technology developed by this company for gene editing. Cellectis also had technology agreements with Monsanto and BASF. Caribou Biosciences is a spinoff from the University of California, Berkeley and is led by Dr. Jennifer Doudna, one of the researchers who developed the CRISPR-Cas9 technology. Caribou is working with DuPont/ Pioneer Hi-Bred on developing droughtresistant corn and in creating hybrid wheat. Field trials of these crops could begin this spring, with commercial availability in five to 10 years. Meanwhile, Purdue University researchers have successfully engineered rice that is five times better at surviving drought. They did this by altering plants so they overproduce a naturally occurring protein, which means they can survive severe drought without having an impact on plant growth under normal conditions. As well, Recombinetics is focused on improving animal productivity as well as the health and welfare of livestock. They developed polled dairy cattle and are currently working to increase muscle mass in Brazilian cattle.

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Canada comes second Cibus, a San Diego-based plant breeding company has already commercialized a new herbicide-tolerant canola variety through gene editing. This new canola strain is resistant to a Group 2 imidazolinone and sulfonylurea herbicide. Unlike the RR and Liberty Link canola lines, this new canola strain is not considered as a GMO by the U.S., Canada, and Germany at this time, potentially opening up new markets and higher prices for growers. Health Canada and CFIA have already reviewed this canola. On the Health Canada website the following statement is included in the review: “Health Canada is of the opinion the food derived from Cibus canola event 5715 is as safe and nutritious as food from current commercial canola varieties.” Similarly, CFIA posted its review of this canola online with the findings “…CFIA has determined that canola event 5715 does not present altered environmental risk when compared to canola varieties that are currently grown in Canada.” Now, a canola variety with the 5715 trait will be available for commercial production in the U.S. this year. When Country Guide asked CFIA if this canola is registered for growing in Canada the spokesperson replied: “To date, no variety of canola with the 5715 trait has been registered to grow in Canada.”

A game changer This is why gene editing is so promising. It does not require genes from other species, but neither is it random like regular crossbreeding or mutagenesis. Instead, gene editing entails a precise and surgical change in one or more genes to achieve a predetermined characteristic. This is why gene editing gets described as a game changer for plant breeding. But there is some learning that farmers must do to understand its full potential, starting with the fact that there are a number of gene editing processes, the most promising of which seems to be CRISPRCas9. (CRISPR stands for clustered regularly-interspaced short palindromic repeats, but don’t worry too much about the details just yet.) In 2011, Jennifer Doudna at UC Berkeley and Emmanuelle Charpentier of Germany’s Max Planck Institute identified how bacteria protect themselves from viruses. They found bacteria store a small fragment of DNA from invading viruses in their own DNA. The advantage of this is, if a bacterium already has a DNA segment in its CRISPR that matches an attacking virus, the bacterium can rapidly mobilize an enzyme called Cas9 to cut up the attacking virus’s DNA. Doudna and her colleagues believe this same process could be used in any organism, including plants and animals. By designing a specific segment of DNA and then either inserting it as a new section of DNA, or else using it to replace a defective DNA sequence, plant breeders can now design huge new opportunities. TALENs and ZFN are two other older, patented processes which are also being used for gene editing but both are more complex. The real beauty of gene editing is that the process mimics the way evolution happens naturally. The only difference is that rather than the change in the DNA happening randomly, as it does in nature, the change is specific and targeted. This means the outcome is already predicated. As well, since the change happens in the DNA of the plant, the new attribute is passed on to future generations of the plant. CRISPR-Cas9 technology has already been used successfully in the laboratory on

Farmers need to learn all the things that gene editing offers, and we need to get governments on side."

important crops including wheat, rice, soybeans, canola, potatoes, sorghum, oranges, and tomatoes. Gene editing research is also underway in Scotland to protect pigs from African swine fever, which attacks entire pig herds in SubSaharan Africa and Eastern Europe. As well, gene editing has been used to prevent the growth of horns in dairy cattle, just as some breeds of beef cattle are polled. The possibilities with gene editing are truly mind-boggling, even in humans. Theoretically, gene editing could inactivate a gene so viral infections such as herpes or AIDs would not occur. Or this technology might be used to correct a defective sequence of genes, as in muscular dystrophy, cystic fibrosis or Huntington’s. Or it may allow new drug discoveries by the insertion of new DNA coding into a gene. But such advances do not happen overnight. It takes a lot of research to identify exactly which gene or multiples of genes are regulating a particular process and how the DNA could be changed to introduce a desired change. We are a long way from ending all inherited disease or having a pipeline of new drugs, pesticides, or even new crop varieties. And we may never get there if this new technology runs into the same opposition as GMO. Farmers need to learn all the things that gene editing offers, and we need to get governments on side. (While CFIA does not consider gene editing to be transgenic, it is still regulating such modification under “novel trait” regulations.) We will need technology like this to feed a growing population given the threat of climate change and the decline of our agricultural land base. CG

To get a better understanding of gene editing there are a number of YouTube videos aimed at the general public on this subject including: https://www.youtube.com/watch?v=2pp17E4E-O8

MARCH 29, 2016 / COUNTRY-GUIDE.CA

The Canadian Association of Farm Advisors (CAFA) Inc. is a national, non-profit professional umbrella organization dedicated to assisting farm families and businesses by increasing the skills of farm advisors and consultants.

www.cafanet.com

Where do you find qualified farm advice? BY LIZ ROBERTSON, M.A.

new study called “Dollars and Sense,” commissioned by the Agri-food Management Institute and Farm Management Canada, looked at some of the key factors in what makes a farm financially successful. The top seven practices that drive farm financial success include: • Never stop learning • Make business decisions using accurate financial data • Seek the help of business advisors/ consultants • Have a written business plan, follow it, and review it annually • Know and monitor your cost of production and what it means for your profits • Assess risks and have a plan to manage and mitigate risk • Use a budget and financial plan to monitor financial position and options A few CAFA members attending the presentation in Guelph on Feb. 29 reported that some of the conversation around point number three — seek the help of business advisors/consultants — was that farmers are not quite sure about where to find qualified farm advisors. The mystery is solved through CAFA.

The Canadian Association of Farm Advisors Inc. is a national, not-for-profit association and we are dedicated to assisting farm families and businesses by increasing the skills and knowledge of farm advisors. CAFA is the go-to resource for professionals who: • Have the technical expertise in their chosen field, • Have made an extra commitment to staying current with farm planning and, • Have connections with other professionals offering complementary farm-focused services. CAFA is a national umbrella organization with accountants, lawyers, bankers, financial planners, risk managers, agrologists, insurance agents, family coaches and interested farmers, among others. Members are professionals who work with farm families and businesses on everything from succession planning, to tax minimization, business expansion, lending and all seven points listed above. What sets CAFA advisors apart from other professionals is the ongoing professional development they receive that is focused on understanding the needs of the farm sector and the application of their professional knowledge to farm matters. Point number one in the “Dollars and Sense” study was “Never stop learning.” CAFA members adhere to that practice. Our professional development opportunities include a Farm Tax Update, Farm Succession

Update, Farm Management Update and a Women Who Farm Update — all presented by highly skilled farm advisors because we believe that continuous learning makes for better farm advice and guidance. Certified Agricultural Farm Advisors have their own professional competencies and an understanding of how to apply their skills and knowledge to farm situations. Finding a qualified farm advisor is simple: farmers can contact CAFA directly or they can search our database of advisors from our website www.cafanet.com. Now go and improve your farm’s financial success!

Wednesday, May 18, 2016 The Delta Hotel & Conference Centre, Guelph, Ontario 3 Circle Model Described Panel: Bett y H an sen , Cr o ssro a d s Pla nn in g Gro up In c. Ro bin- Le e Norr is, M iller T ho m son L L P Jim Sn yder , BD O Ca na d a LL P

Family Circle For Your Fa m ily’s Sa ke : L e n Da vie s, D a vie s L eg a cy Pla nn ing Gro u p I n c. Ble nd e d F a milie s: Sar a h Ja co b, SM M L aw Pr of e ssio na l Cor por at io n Ho w t o Wor k with M u lt i- Ge n erat ion a l F ar m F a m ilie s: D arr ell Wad e, F arm L if e Fin a n cial

Management Circle Co na tio n: T h e Mo st I m por ta nt Wor d You Ha ve Ne ver He ar d: M ich ae l Bo ssy, Bossy N ag y Gro u p Ch art ere d Pr ofe ssion al Acco unt a nt s Str at eg ic Pla n ning : Ro b Ha nn a m, Synt h e sis N etw or k Emb e dd in g Su st ain ab ilit y int o Your Fa m ily F ar m Str ate g y: N ick Be tt s, OM AF R A

Ownership Circle Gr ea t Exp e ct at io n s: Te d Oldf ie ld, Oldf ie ld, Gr e a ve s, D ’Ag o st in o Co ntr ol: D e nis Sicott e, Sicott e Gu ilb au lt L LP Tru st & Em ot io n al I nte llige n ce in L eg a l Draf tin g: Joh n M ill, Bu sin e ss Succe ssio n Pro fe ssio n als

Special Lunch Keynote Speaker: Maggie Van Ca mp, Country Guide Assistant Editor: The chan ging roles of women on the fa rm ************************************************************************* June 2, 2016 Woodstock: Farm Management Update November 3, 2016 Saskatoon: Fa rm Succession Update

SAVE THE DATES! May 18, 2016: Farm Succession Update – 3-Circle Model In-Depth, The Delta, Guelph (from Ajax), Ont. & via webinar June 2, 2016: Farm Management Update, Woodstock, Ont. & via webinar November 3, 2016: Farm Succession Update, Saskatoon, SK. Fall 2016: Farm Tax Update

More information available at www.cafanet.com/Conferences

Toll free: 1-877-474-2871 Email: info@cafanet.com PO Box 270 • Seven Sisters Falls, MB • R0E 1Y0

business

Inspired

to make a difference They’re growing the kids that are going to defeat world hunger By Angela Lovell

et’s just say that for these four Canadian high school students, the act of sitting on the floor and dipping their hands into a communal bowl of rice shared with 75 other people was an uncomfortable experience. Yet this way of eating is routine for millions of the world’s poor. “I only had to go hungry for one night, but it made me realize that so many others live like that daily,” says Kaitlyn Kitzan, one of the Manitoba and Saskatchewan students selected to attend the 2015 World Food Prize Global Youth Institute last October during the Borlaug Dialogue International Symposium in Des Moines, Iowa. Kitzan, a Grade 12 student at Sacred Heart High School in Yorkton, Sask., attended an Oxfam Hunger Banquet along with other students from the United States, China, India, Kosovo, Mexico and Turkey. Students and their mentors were grouped either into the lower class — the majority of people in the room — who shared a bowl of rice on the floor; the middle class, who sat on chairs and lined up for rice and chickpeas; or the upper class, who were served a three-course meal at dinner tables. “When I had read hunger statistics before I went to this event, I didn’t think about them as people starving,” says Bailey Gitzel, a Grade 12 student from Carman Collegiate in Manitoba, who drew a lower class ticket. “This put me into someone else’s shoes and made me realise that hunger is real. It’s not just words on a piece of paper.”

I met a lot of important people. It might help to broaden my future opportunities as well.”

March 29, 2016 / COUNTRY-GUIDE.CA

Sheldon Daniel

Hard Work to Get There The students had to work hard to get to the conference, spending many hours to prepare an extensive research paper on the topic of “Sustainably Feeding 9 Billion by 2050.” Each student presented their paper at the end of the conference to a diverse group of distinguished international experts and scientists from many different disciplines, as well as past and present World Food Prize laureates. “Being a farm kid from Saskatchewan, I thought this was a really cool event to combine my passion for international development and agriculture together into one event,” says Kitzan, who participated in an international development trip to Equador last spring, and wrote her research paper about her experiences there. Kitzan enjoyed the hands-on activities at the conference and hopes to bring at least one of them back to her own school for other students to get involved in. “We packaged thousands of meals for a Third World country,” she says. “If I can inspire others to do even little actions like this towards alleviating world hunger, we’ll get closer to that goal than we are now.” Teacher mentor Kerrie Shearer from Sacred Heart High School was excited to be able to bring curriculum guides and hands-on activities back to her school. “It’s very disheartening to go to a conference, and it’s so impactful, but then there’s nothing to bring back,” says Shearer. “The “ahha” moment for me was seeing things I could easily bring back to my school to create awareness among my students.” People of Influence Students and their mentors rubbed shoulders with some high-powered movers and shakers in the agricultural and scientific world, as well as people who have made a big difference to world hunger, such as the 2015 World Food Prize Laureate, Sir Fazle Hasan Abed of Bangladesh. Sir Fazle founded BRAC, the largest non-governmental organization in the world, which has improved the lives of nearly 150 million people worldwide. “Getting my picture taken and being presented with a certificate by the World Food Prize Laureate is something I won’t forget for a long time,” says Sheldon Daniel, a Grade 12 student in Avonlea, Sask. who grew up on a family farm, and plans to pursue a degree in agriculture at the University of Saskatchewan. “I’ve always been inter-

ested in agriculture, and I thought the conference would be a good way to get to know people in the industry.” After presenting his paper on the future of sustainable agriculture in China to Sir Fazel and the assistant dean of Agriculture at Iowa State University, Daniel was able to meet and chat with them. “I met a lot of important people, and I think they might know my name if I ever run into them again, so it might help to broaden my future opportunities as well,” he adds. Making Important Connections Making connections, especially for rural kids, is a valuable part of the event, says Daniel’s science teacher and mentor for the event, Larry Bogdan. “Small town kids often get such a local idea of issues, and don’t get exposure to the fact that it’s a small part of a big picture,” he says. “This kind of event is important to open up a lot of possibilities, and help young people be less shy about making connections.” A lot of universities were present at the event, says Shearer. “On the last day when the students were giving their speeches, there were delegates listening from American colleges, who were waiting to cherry-pick the best minds,” she says. “These kids all worked really hard to even get there. They are all students with strong science/ agriculture minds and their plans are to do big things.” Gitzel is already an enterprising young farmer who raises chicken and produces honey on her family farm near Carman, Man. She says the conference was a great opportunity to listen and talk to the people who make decisions in the agricultural industry. Gitzel got to chat with Rob Fraley, executive vice-president of Monsanto, about the future of agriculture. “He talked about using different technologies so that one day we could not use as much land and resources but still grow the amount of food we need,” she says.

The Manitoba students were chosen by Agriculture in the Classroom — Manitoba and the Manitoba 4-H Council, and travel costs for the students and mentors were sponsored by Manitoba Canola Growers Association, Manitoba Corn Growers Association, Monsanto Canada and Viterra. Saskatchewan students and mentors were selected and sponsored by the Saskatchewan Ministry of Agriculture. It was a life-changing experience for the students and their mentors, each coming back with renewed resolve, fresh ideas, a lot of inspiration for the future of agriculture, and a burning desire to help eliminate food insecurity around the world. As a science teacher with a farm background, Rosanne Massinon from Carman Collegiate was inspired by the World Food Prize event to tweet thanks to all her farming family and friends. “It really put a value on what they do every day, and demonstrated that there’s a bigger purpose for agriculture than just making a living,” she says. “It struck me that hunger isn’t something we have to have in our world, and that with agriculture education, particularly in the developing world, we can live in a world where people don’t have to go hungry. And the young people at this event are inspired and want to take on that task.” Gitzel, who also attended the Grow Canada conference in Ottawa in 2014, says the World Food Prize helped reinforce her decision to study food genetics, but also consider development work overseas in the future. “After hearing people’s stories of how they were able to change people’s lives, I would really like to be able to do that,” she says. “But I have to go to university first and take the steps to get there.”

All the GYI participants gather in the rotunda of the World Food Prize Hall of Laureates: “a bigger purpose for agriculture.”

CONTINUED ON PAGE 52

COUNTRY-GUIDE.CA / March 29, 2016

business Pick Your Passion Laura Didyk, the other Manitoba student attending the event, says meeting people from all over the world had the greatest impact on her. “Everybody had something unique that they brought and you got to see a wide variety of opinions and learned that it’s not just one thing that is going to affect food security, it’s a bunch of things,” says Didyk, who attends Grade 11 at St. Paul’s Collegiate in Elie, Man. Didyk plans to go to university and is considering the field of agricultural sciences. A big message at the conference, says Didyk’s mother, Tracy Claeys, who is also her 4-H leader and attended the conference as her mentor, was that there is a huge need in agriculture for people from various fields of expertise. “Speakers said that we need people who can communicate, build databases or crunch numbers, so it doesn’t matter what you do; pick your passion and you can use that to help food security,” she says. “In the future, I can see myself bringing international development into my career

and working with different third world countries and their agriculture practices,” says Kitzan who is heading to the University of Saskatchewan to pursue a degree in animal science. “This event allowed so many creative minds from all across the world, who have this passion for agriculture, to get together and share our ideas and our frustrations. It gave us the opportunity to make connections and friendships and memories. Now, after I have come back home, I have all those people to look up to or connect with to help me keep up with my goal.” Daniel agrees it’s the people he met that he’ll remember most. “All of the speeches were good, but I watched one young guy from India present, and he couldn’t have been more than 15 years old, and he was the best speaker I have ever seen,” says Daniel. “You might think you’re a pretty smart kid from rural Saskatchewan, but there were really smart kids from all over the planet. And it was then that I thought it’s these people that are going to make a difference in the world. They are here because they want to do that.” CG

After hearing people’s stories of how they were able to change people’s lives, I would really like to be able to do that.” Bailey Gitzel

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