Across the Prairies, producers continue to grapple with escalating fuel prices that make it harder to farm profitably — but there could be some relief in sight. PXN360 is a new offering from the company behind the popular online grain marketplace CXN360.
PXN360 (the PXN stands for Petroleum Exchange Network) is a new tool from Ag Exchange Network that enables farmers to quickly and easily shop around on their smartphones or mobile devices for the best prices on petroleum, diesel and propane.
“I think it’s been an ignored market,” says Lyle Ehrmantraut, president and CEO of Saskatoon-based Ag Exchange Group. “A lot of the growers, they deal with a fuel supplier that’s down the road. We’re going to introduce new options to them (to purchase) products from new fuel suppliers that they maybe haven’t dealt with in the past.”
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Ehrmantraut says PXN360 works much like CXN360. After sending out a pricing request to multiple fuel suppliers on the PXN360 network, farmers can select the offers they like best. Fuel suppliers can notify buyers themselves as well, to let them know when product is available and at what price.
“Growers are going to have the same opportunity to interact with multiple fuel suppliers to get the best price and communicate with them efficiently through the platform,” says Ehrmantraut.
Ehrmantraut maintains after a tough year like 2021, Prairie farmers are looking at every penny they spend. Many of them, he says, likely aren’t aware that, historically, certain times of the year are better than others for purchasing fuel, and PXN360 offers a way for farmers to track the fuel market so they can take advantage of the best prices.
“Having more choices and multiple suppliers that can bid for your business is always good for the farm,” Ehrmantraut adds. “It might not just be about price. There might be a service level a different fuel supplier offers that really meets your needs.”
Farmers typically order fuel during times like harvest when it’s needed most, but Ehrmantraut says with on-farm fuel storages getting bigger these days, producers have a lot more control around when they can take their product.
PXN360, slated to go online this month, will be offered as part of the CXN360 package. “We want growers to have the experience, specifically those folks who are already familiar with CXN360,” says Ehrmantraut, adding more marketing opportunities to connect farmers with businesses are planned for the future.
“This is really just kind of brushing the surface. There’s lots of other markets that we can address here as we go forward,” he says.
CXN360 growth
According to Ehrmantraut, CXN360 was developed with the goal of providing a more efficient marketplace and to create a community for grain sellers and buyers that is a trusted place to do business.
Launched in 2017, the CXN360 network, now with more than 3,000 farm members, represents about 17 million seedable acres in Western Canada, according to Ehrmantraut.
“Our acres have grown dramatically over the last 12 months, and we expect that trend to continue — and we’ll be north of 25 million through 2022,” Ehrmantraut says. The number of grain buyers on the CXN360 network has also grown to more than 150 locations in Western Canada, he adds.
Here’s an example of how CXN360 works. Farmers receive price notifications from grain buyers on the network either via text or through the CXN360 app. If a farmer sees a great offer, he or she clicks the link to notify the buyer the farmer will sell the grain at that price. After that, the farmer enters a PIN code and a digital signature, and the transaction is done.
CXN360 is a subscription service, meaning members pay an annual fee rather than a charge for each transaction, and subscribers can choose what they want to sell, when they want to sell and at what price.
“That’s really what the technology was brought on to do — to bring more opportunities to growers, to get them better prices for their grain and to do this in a fraction of the time it takes them today,” says Ehrmantraut.
“From the buyer’s perspective, this is an extremely efficient way to reach out to the customers as well. The traditional methods of texting growers or having reps running down the road takes a lot of time. With CXN360, (buyers) can hit two or three thousand customers in 30 seconds.”
According to Ehrmantraut, all CXN360 transactions are secure and transparent, so farmers don’t have to worry about not being paid and they always know who they’re selling their grain to.
“Growers want to know who they’re dealing with, and buyers want to know who they’re dealing with on the other side,” he says. “Our buyers are well-known buyers. We don’t allow just anybody to be a buyer on the network. Same with growers. You’ve got to have a legitimate farming operation.”
Ehrmantraut states all transactions are legally binding agreements that are logged in the CXN360 system to provide proof of agreement. He adds most CXN360 buyers are insured and licensed through the Canadian Grain Commission and those that aren’t are required to carry payables insurance to guarantee payments for grain purchases.
Ehrmantraut considers CXN360 a game changer for many producers accustomed to working exclusively with buyers often within an hour or so of their farms.
“It’s fine to have your local relationships. We encourage growers to maintain those, but, you know, at the end of the day, you need to get the best price for your commodity as well,” he says.
U.S. expansion
Later this year, farmers will have more places to sell their grain using CXN360 as the network is expanding its business to include buyers south of the border.
“I think having more options is always better, so we plan on having multiple U.S. buyers available on the network prior to the crop coming off in 2022,” says Ehrmantraut.
Many producers in the southern parts of Alberta, Saskatchewan and Manitoba already sell grain to companies in the Northern Plains states, and some of these buyers have operations in both the United States and Canada, he notes.
Ehrmantraut says CXN360 will provide a digital tool for those U.S. buyers to access more Canadian customers while also offering up more opportunities for Canadian grain farmers to get the best price for their products.
For more information visit cxn360.ca.
