When I started working at The Western Producer, farmers were still subsidized by the Crow Benefit, the grain handling co-operatives were profitable collections of wooden elevators, a four-section farm seemed big and a 600 sow pig barn was described as a “huge corporate operation.”
That’s changed in the 15 years since my first day of work Nov. 14, 1994.
The Crow flew off into memory. Saskatchewan Wheat Pool went public and the co-ops expanded, stumbled, fell and eventually morphed into something that looks little like the old pools. Farmers don’t feel like big landowners if they farm “only” four sections, and a 600 sow barn is at the bottom rung of the viability scale.
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It’s been a time of major change and evolution for the prairie farming industry, and producer attitudes seem to have changed remarkably quickly to deal with the new realities.
When I started here, many producers seemed to feel that farming was the common person’s way of life, and the government had a duty to help the common folk in bad times.
But the Crow’s death and the government’s paltry payout seemed to shock farmers into realizing they were now seen as a special-interest group.
In times of national crisis, such as the war on the debt and deficit in the mid-1990s, farm programs could be sacrificed. Support for farmers became a matter of grace, of urban noblesse oblige indulged only in good times.
A few years later, when crop prices fell, farmers held rallies to bemoan the “farm income crisis” but few seemed to believe that the government would truly try to provide more than a stopgap measure.
Wailing about the “cheap food policy” became restricted to old curmudgeons while more realistic and younger farmers figured they’d not likely see programs that made food for urbanites more expensive.
So farmers changed, becoming professional crop and livestock managers, professional business operators and professional financial managers.
Perhaps thousands truly professionalized in response to this situation, or perhaps farmers who did not get serious about management were driven from the business. Today it seems rare for a farmer not to have a sophisticated understanding of the intricacies of his business.
There’s one area, however, where many still seem as simple and unprofessional as in the past: marketing and pricing.
Thousands of farmers actively manage their price risks, but a surprisingly large proportion still don’t lock in any of their prices. It causes needless pain.
During the historic crop price surge of mid-2008, thousands locked their bin doors and sat waiting for $30 canola and other big prices. Over the past two years, when slightly profitable or break-even hog prices were available, many ignored them, holding out for a bigger rally.
It seems a holdover from an earlier farming age, when most bravely faced an array of risks with only luck and faith on their sides. They hoped that the rare market mega-payoff would cover all their bad luck.
It’s an understandable sentiment if you run a simple operation and survive on hope and luck, but it doesn’t fit today’s professionally managed, carefully analyzed farms that operate with peak efficiency in every other area.
Marketing advisers, brokers and bankers have preached this message for decades.
I hope that in another 15 years, I can reminisce about a long-forgotten time, when farmers didn’t hedge and rode the markets naked.
