Get an independent assessment before shopping this year’s crop to elevator companies.
That was the advice of several grain marketers contacted last week about how to move the 2014-15 quality-diverse crop.
“First thing you want to do is get your crops — every bin — tested by a third party grader,” said James Calloway of Johnston’s Grain in Welwyn, Sask. “It’s worth the expense.”
Jim Beusekom, a feed grain marketer at Market Place Commodities in Lethbridge, agreed.
“Once they’ve got the crop off, they should get the grain graded,” said Beusekom.
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“When you have something with so much variability in grade, go to something like SGS, and find out what you have and get official grades on every bin that you have. Then you’ll know what you have.”
SGS Canada is a seed testing company.
Many marketers consider third party testing a smart move, but not critically important in most years. Recent crops have been easy to judge, and off-grades have not often been disastrously discounted.
However, this year top quality crop will likely be in short supply and the rest will be weather damaged.
Most marketers think that will lead to big discounts on damaged crop and healthy premiums on quality crop.
However, with elevator staff seeing lots of bad loads, they might begin grading some grain more harshly than justified. That’s why marketers are suggesting farmers get third party testing to counter unreasonable elevator grading.
“Knowing what you have is going to be important, and knowing what the premiums and discounts are going to be there is important to have in writing,” said Brennan Turner, operator of FarmLead, an online grain marketplace. “Otherwise, you’re going to be going to the elevator and standing on the outside looking in.”
Calloway said advice to get grain tested does not suggest elevator graders are being intentionally dishonest, but they have a vested interest in protecting their company and its exposure.
“We want to see somebody who has no financial interest whatever in the product being the one who does the grading,” said Calloway.
Turner, who has recently begun offering SGS testing through his site, said testing has become an element of good marketing for the past few years and is essential this year.
“If you don’t have something backing it up, you can be at the mercy of whoever’s grading it,” said Turner.
