Securing a canola crop with a premium contract is an option many growers take advantage of each year. Delivery flexibility, the option to lock in a premium price, and a guaranteed end-use customer are just a few of the benefits of Clearfield® canola. Growers have the added opportunity of growing a non-GMO product that continues to see increasing demand from local crushers and their North American customers.
“Some growers contract with us to take their canola in the first delivery window as that is the best way for them to manage their cash flow. Others store it in order to take advantage of deferral premiums or deliver later in the season depending on their tax situation.”
Chad Molesky, Viterra
“Growers choose Clearfield for different reasons,” says Jeff Loessin, Canadian Seeds Leader, Marketing with Corteva Agriscience. “It’s a high-performing canola suited for a particular end-use market. The premium pricing and year-round delivery are key. But there is also a segment of the consumer market that wants canola oil products that are expeller processed. Clearfield canola provides the growers with a value opportunity that meets all those needs.”
Listen to the live interview with Jeff Loessin, Canadian Seeds Leader, Marketing with Corteva Agriscience.
Clearfield canola hybrids are available from a number of seed brands including Brett Young™, Proven®, Canterra Seeds, and Pioneer. This provides farmers several choices to work with their preferred seed supplier and the hybrids that work on their farm. Corteva also offers Clearfield canola hybrids through their Brevant™ seeds Nexera® canola lineup.
Loessin says it is important to be responsive to all aspects of the marketplace. “If we don’t as a canola industry respond to the demands of the consumer, they will find another type of oil to meet their needs and that isn’t good for growers and it’s not good for Canadian agriculture. Clearfield canola growers are uniquely positioned to respond to the requirements of the Clearfield contract market with a canola that meets consumer needs, and their agronomic needs.”
Through their Identity Preserved (IP) contracts with Viterra, farmers who grow Clearfield supply canola primarily into the North American snack food and packaged foods markets. With customers just south of the border, Canadian canola growers with IP contracts are not subject to some of the marketing risks that can occur in global commodity markets.
“Growing Clearfield canola under contract means farmers are growing their crop for a specific end-user,” says Tyler Groeneveld, Commercial Grains and Oils Leader, North America for Corteva Agriscience. “In recent years, consumers have been eating more snacks throughout the day than they have sit-down meals. They have given themselves permission to indulge and there is a growing segment of that population who choose a healthier option for their snack food.”
Listen to the live interview with Tyler Groeneveld, Commercial Grains and Oils Leader, North America for Corteva Agriscience.
Groeneveld says that Viterra has developed good relationships with these end-use snack food producers and has been working with Canadian canola growers to secure a steady and reliable supply of high-stability, heart-healthy canola oil to compete against other options such as sunflower and safflower oil. He says Clearfield growers who participate in this value chain can earn more money per acre.
“It’s a bit of a shift because we have always thought of growing canola as producing a commodity, and that is still going to be the bulk of the canola Canadians grow,” Groeneveld says. “But this evolution of growing canola as an ingredient for a specific market means growers can connect with the end-user and make a premium by meeting a very specific demand. This demand for healthier snack food shows no sign of slowing so growers should expect these opportunities to increase in coming years.”
While marketing options are critical, a high-yielding, easy-to-grow crop will always be important to growers. The Clearfield system, together with the Group-2 action in Ares™ SN herbicide, provides single-pass control of flushing weeds and is especially beneficial for controlling cleavers and high populations of weeds such as lamb’s quarters or pigweed. Amity™ WDG herbicide allows re-cropping freedom which can be beneficial for growers looking to minimize concerns of a Group-2 residual carryover from their pea, lentil or soybean crop. The Clearfield system with either recommended herbicide also provides an alternative mode of action to manage volunteers from previous systems, including volunteer canola.
“Especially for those who have an agronomic need to grow a canola using a Group-2 chemistry, why not get an extra premium and a guaranteed delivery window?” says Loessin. “You are combining the needs of your farm while participating in a value chain where the properties of the canola oil are being sought after by the end-use companies. Why wouldn’t you take that premium?”
The Clearfield contracts for the 2022 growing season were recently announced by Viterra. Benefits of early signup include choice of delivery window and hybrid selection. Chad Molesky, Viterra’s General Manager of Country Grain Marketing, says contracting at the beginning of the season takes away some of the risks in the volatility of export markets as growers know almost a year in advance where their canola will go and what they can expect as a return. Most of Viterra’s canola oil and meal is delivered to the North American market for the snack food and industrial frying markets.
Listen to the live interview with Chad Molesky, Viterra’s General Manager of Country Grain Marketing.
“Viterra’s canola contract program is one of the largest Clearfield and most attractive specialty oil programs in Canada,” says Molesky. “We are presently offering premiums of $2-3 bushel per acre higher than the generic market price for canola. The Clearfield canola we contract is used by our North American food customers who are asking for a solvent-free alternative for a clean label on everything from popcorn to potato chips.”
Viterra is Canada’s biggest expeller-pressed domestic canola crusher with its facility in Ste. Agathe, Manitoba, where it takes delivery of both Clearfield and Nexera IP canola throughout the year. Molesky says that with Viterra’s program already launched and attractive premiums in place, he anticipates early signups by farmers. He says many of their earliest-contracting farmers choose to have their canola picked up immediately following harvest. Growers often choose this option to manage bin space, to manage cash flow, and to reduce the possibility of quality risk from storage.
“Some growers contract with us to take their canola in the first delivery window as that is the best way for them to manage their cash flow,” says Molesky. “Others store it in order to take advantage of deferral premiums or deliver later in the season depending on their tax situation. We have different contracts available to offer flexibility to the grower always at a premium price.”
Molesky says that all of Viterra’s IP contracts have a pricing premium and pickup or delivery options, and also allow growers the opportunity to choose the way they price their contract. “Growers can lock in a basis contract with Viterra, or they can do a fixed-price contract depending on their marketing preference,” he says. “If producers wish to price the basis portion of their contracts, we do offer a full Act of God clause on those contracts. Therefore, there are opportunities for flexibility within the contract based on a farmer’s own personal risk tolerance.”
Canola growers who are interested in growing Clearfield canola under contract for the upcoming season should contact their local grain company or talk to their customer account representative for additional information about when and how to enrol.
