What should I grow? What is going to make me money?
These are common question this time of year. If only grain brokers had a crystal ball to answer that question with assurance! But at the end of the day the professional experts and even the coffee shop geniuses are really only taking a stab in the dark.
There are so many different cropping options, how do you know which makes the most sense for your farm? The best place to start is talking to your local elevators, processing plants and brokers and getting their thoughts. They will provide you with the best information they have at hand because in the long run they want to earn your business. However, in the end it is your decision and it comes down to agronomics, marketing and what works best at your farm.
Growing “niche” crops
Depending on your region and growing conditions there are a number of niche crops that many farmers may not necessarily know about. If you are looking for a pulse option there are limited acres on something like a marrowfat pea. The beauty of these is that they grow extremely similar to any other pea and typically yield you more money at the end of the day. Buyers of these peas would offer you a full production contract, so there is literally no risk to your farm if there happens to be an “Act of God” and you don’t get a crop.
Marrowfats offer a pretty healthy premium over a yellow or green pea. So what’s the downside? Most contracts for marrowfats are full crop year, meaning delivery timelines can go from off the combine to June of the following year. This is a small market crop and “limited acres available” from buyers generally means they don’t take on more than they can handle, so overproduction is a risk.
Although not “niche” per say I think flax and mustard are commodities that too many people disregard as the “poor man’s crops.” On our Rayglen 24-crop projections calculator these two crops are in the upper echelon of return per acre. The cost of production is lower than many other crops and they don’t have the extreme disease susceptibility that some of the other oilseeds, cereals and pulses do. Contracts with Act of God are offered on both flax and mustard so growers can pencil in a profit while not carrying production risks.
Unlike a lot of other crops mustard demand is pretty much inelastic so if there is a production failure prices will shoot up. Flax, on the other hand is gaining momentum, as China becomes what appears at this time to an unquenchable beast the flax industry is pretty confident in their future. There are some very strong production contracts available for both flax and mustard.
Another big topic of conversation of late is faba beans. I have to be honest, we are fairly new to marketing these beans but already we have learned that the end buyers are quite particular about the variety of fabas that they purchase with both size and tannin content being considered. The highest premiums, pricewise, are going to come from the largest seed type available. These seeds are so big that they tend to cause issues with seeding and so far that is why growers have tended to shy away from these larger ones until the market develops more.
What we have managed to do in the meantime, is secure some small programs with a few buyers in the $6 to $7 range with an Act of God clause. These programs will give growers an opportunity to iron out any seeding and agronomic issues of growing a new variety on your farm, while still knowing they have a home in the fall for their production. Fababeans have the potential to be a great addition to many crop rotations in Western Canada, especially in the wetter zones of the Prairies. It’s another option that is starting to look promising.
At the end of the day the markets change so rapidly that by the time you’re done reading this article, chances are something has happened in the world market that impacts us here in Western Canada.
There are a variety of different crops that we can grow here so you need to grow something that is going to provide you a profit. Even if you aren’t comfortable with venturing out into a niche crop market why not look at the contracts available for crop you already grow? For example, for those in red lentil growing areas, we have been trading new crop contracts in the mid 20’s with an Act of God picked up in your yard. At an average yield of say, 1,500 lbs./acre, this is grossing your farm $375 an acre. How do you go wrong in taking some risk off the table and locking in a profit?