Consumer demand for organic oats has soared in recent years, and producers are showing an interest in growing them
It wasn’t hard to find organic oats prices from Grain Millers at the recent Ag in Motion outdoor farm show. New crop and old crop bids were listed at the front of their booth just as prominently as conventional prices, underlining the importance of that market for the company.
“We bring (organic oats) all the way down from Lacrete, (Alta.),” said Kelly Cornelius, a grain procurement specialist with Grain Millers in Yorkton.
“It creates a bit more of a challenge to find it (than conventional oats.) Our organic region covers all three prairie provinces, while most of our conventional is bought pretty close to our plant in Yorkton.”
Oats have long had a differentiated market, despite it being a relatively small crop. It supplies premium horse feed, as well as nutraceutical products for health and beauty products in addition to its food uses.
In food, oats was the first crop to have a U.S. health claim allowed for its impact on the human cardiovascular system. That helped it become more than just a bulk product that provided oatmeal, Cheerios and flakes on baking products.
Oats is now a significant part of hundreds of health-focused food products, such as granola bars and specialty cereals. Since many consumers of those products believe organic is preferable to conventional, and many processors want to be able to claim that their products are organic, the market for organic oats has exploded in recent years.
“The market’s there. The market is dictating that this is a wise move. Growers are moving there too,” said Cornelius.
Marketing organic oats is different for growers and millers. Conventional oats contracts generally don’t contain act-of-God clauses, which has become a major issue in the conventional crops industries.
Organic oats contracts with Grain Millers, however, do contain an act-of-God clause, which Cornelius said reflects the increased risk and challenges that come to growers with organic production. There is also a shortage of organic oats, with demand outstripping supply.
The company also works with new and smaller organic growers to help them grow, store and market the crop.
“We try to have a relationship that is beneficial both ways,” said Cornelius.
“We’ve always been at the edge of developing new programs.”
With a decent yield, organic oats can be a rewarding crop. Both old crop and fall 2022 prices were $11 per bushel, which is a good premium to most conventional prices.
“It is very profitable if you can do it correctly,” said Cornelius.
