Getting a great canola crop off the field is just the first step in making a decent profit. The second is selling it for the best possible price. And that, says Jeff Hoiness, can take almost as much time as growing the crop.
For 17 years, Hoiness and his brother have grown and marketed canola from their 10,000-acre farm near Allen, SK. “We've always been interested in the marketing end,” he says. “And we spend a lot of time on it.” For him, there are three things to think about when it comes to successfully marketing canola.
1. Get educated. “The key to our approach is that we try to make educated decisions,” says Hoiness. This means paying attention to U.S. and Canadian market reports on supply and demand, keeping an eye on basis levels, and being aware of what's happening to canola crops around the world.
“There are enough people willing to provide services giving you information and making recommendations,” he says, adding that subscriptions to a couple of commodity newsletters help him build his information pool.
2. Don't be a follower. “We try to sell into rising markets,” says Hoiness. “We try to take a contrary approach and avoid selling when everybody else is.”
With good on-farm storage capacity, the brothers can afford to hang onto canola and sell when the price is right for them. “We pay attention to our needs, like production costs and cash flow, and we're willing to take 5 per cent to 6 per cent on our operating line because it can be recovered quickly when you're storing grain.”
3. Remember your priorities. “As producers, we sometimes have to remember not to get too wrapped up in the difficulties of marketing,” says Hoiness. “We can control yield better than price. Even if you're trying to make the most educated decisions possible, you're still going to get it wrong (almost) as many times as you get it right, but hopefully, you can balance it out.”