Getting the right price | Producers share information to get the best possible price
Six forage producers in Manitoba have found it possible to compete and co-operate on export sales to the United States.
The producers, who belong to Manitoba Forage Marketers, manage their own farms and arrange their own sales, independent of the other members.
However, they also share information about customers, prices and the most efficient ways to ship forage to foreign hay buyers.
Chris Kletke, who farms near Brunkild, said the knowledge within the network has helped him get an optimum price for his forage.
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“The biggest thing is it is a price discovery tool,” said Kletke, who exports primarily alfalfa and wheat straw.
He said it can be tricky to get a read on prices in a regional market be-cause it requires information about supply and demand in a specific part of the U.S.
The group, now in its third year, exchanges information to clear up the murkiness.
“If you have a knowledge of what things are trading for … you can make sure that you’re getting a good return for your product or make sure you’re not pricing yourself out of a market,” Kletke said.
He said members are able to balance competition and co-operation because they trust each other.
For example, a member wouldn’t have to divulge the name of a hay buyer in Tennessee if he didn’t want to, but the more information a producer shares the more help he’s likely to receive in exchange.
Manitoba Forage Marketers isn’t a co-operative, but members can refer potential buyers to each other if they are unable to fill the order themselves.
It operates as a committee of the Manitoba Forage Council.
“They are a pretty skilled group,” said Brent McCannell, executive director of the council.
“They are moving a lot of hay this winter into the southern U.S. because of the drought.”
Kletke said the association may expand beyond six producers, but the members will be careful about how they manage their co-operative network.
“With this group, the biggest thing is the trust factor,” he said.
“The challenge is building the group with producers that are on the same level … in terms of sharing market information and where product is moving.”
Members of Maitoba Forage Marketers:
- Southman Alfalfa Producers, Crystal City
- Chapman Farms, Virden
- Heppner Farms, Altona
- Sigurdson Farms, Gimli
- Kletke Hay & Straw, Brunkild
- Teleglow Farms, Ste. Anne
