Better Decisions

Making sense of the mystery of the market

Growers know all about planting and harvesting. But, for many, the ebb and flow of the grain markets remains inscrutable. Here, the marketing development manager for a major grain company offers some guidance


Don Kabbes is sitting in front of several monitors wired directly to the network of the Chicago Board of Trade (CBOT). On the screens are colourful graphics, depicting endless numbers of pennies, dimes and quarters being spent or paid.

With the click of the mouse, prediction charts surface showing end-user stocks. Another click to an e-mail: “USDA reported a 250k MT corn sale to an unknown destination.”

Beware the Alternative Minimum Tax when you sell your farm

Retiring farmers believe the capital gains exemption takes care of everything, but it doesn’t. The AMT can still take a big chunk out of your returns


When Dan and Diane Harkin sold their Winchester area farm last December, they expected their capital gains exemption would take care of any tax. They were wrong. When the dust cleared, the Harkins were hit with something called the Alternative Minimum Tax (AMT). Their tax bill was about $32,000.

The AMT has been around since 1986. It was introduced to address concerns that some individuals and trusts with high gross incomes paid little or no income tax, but the Harkins didn’t see themselves falling into the high-earning category.

Better Decisions: Five steps to making better marketing decisions

Events – and reactions to them – can make a mockery of the best-laid plans.
Here are some tips to help you make and stick to the right marketing decisions for your farm


At a marketing skills workshop I led recently, there was plenty of buzz about the difficulty of making – and sticking to – marketing decisions. More specifically, my workshop participants were frustrated by market pundits and advisors with facts, figures and outlooks that sounded right, but turned out to be just plain wrong.

Better Decisions: How high should corn go before you hedge?

The ‘Rule of Thirds’ may help you decide what hedging strategies to adopt after the great bull market in corn


Remember the early part of the decade? Back then, ethanol had yet to create an elephant-sized hunger for corn and there had been two back-to-back years of disappointing yields for wheat and other non-GMO grains around the world.

Way back in 2004, corn traded to a lofty price of US$3.20 and two years later fell to $1.86 in the face of a big harvest. The great demand-led bull market of 1996 with its $5.50 corn was fading into history, confirmation that the good times were past and never to return.

Better Decisions: Ten steps to a successful marketing plan

To make your marketing plan work, you need to take a disciplined approach and devote the necessary time. Here are some key elements


A marketing plan helps to develop a strategy for marketing the crops and livestock produced by a farm business. It challenges producers to identify costs, develop price goals, consider production and price risks, and review price and market outlooks.
Putting the marketing plan in writing provides the discipline to follow the plan and to monitor your decision making throughout the year. Below are 10 questions to consider when developing the key features of your marketing plan.

Management: You, too, have health and safety responsibilities for your temps

It’s not just the employment agency that is responsible for health and safety education. The task is shared and you neglect it at your peril


When it comes to health and safety, employers cannot take shortcuts with temporary workers.  During times of high production, it is tempting to rush through training and put the temps to work right away. But the benefits of increasing production are not worth the risk of potential fines by the Ministry of Labour for a violation.

Better Decisions: The key commodity marketing terms you should know

A checklist that will help guide you through the jungle that is the commodity markets


There is a lot of jargon tossed around in the commodity marketing world that can be confusing when you are developing and executing your marketing plan. To get you started, here is a list of definitions of some key marketing terminology.

Forward Contract. A contract for the cash sale of grain or livestock at a specified price, quantity and quality at a specified future delivery time. It is a privately negotiated contract between two parties (i.e. farmer and grain elevator).

Better Decisions: What’s your game plan?

The main reason new business ventures fail in their first two or three years is lack of planning. A sound business plan will help you focus your ideas into manageable components


Often, we hear a farmer say:

“I would expand or grow my farm business, or start a new venture on the farm, if only I had more time and money.” Are there, in fact, things you can do in planning for an expansion or new venture to ensure that the time and the money are available?

Better Decisions: The CSA model catches on with small farms and customers alike

Community supported agriculture programs are proving a great way to test market products on a small scale with little capital investment – just a lot of sweat equity and passion


A recent review of the 2006 Agriculture Census reveals just how much farm size is changing. In Ontario, the number of farms under 70 acres is growing (see Figure 1). In fact, the small farm movement across North America is expanding because of the increasing trend in direct-to-consumer sales. This consumer interest in buying local food directly from the farm gate or at a farmers’ market has prompted an increase of 1,477 new small farms in Ontario between 2001 and 2006 as small farm operations step up to meet the demand.