Winning With Wheat

Winning With Wheat

“Weigh in on Wheat” – Fun at #FarmSmart2018

I recently had the chance to be involved in quarterbacking a session related to wheat production with the FarmSmart conference in Guelph.  I enjoyed the chance to dig deeper into the success of two separate farm production systems where the growers really value the wheat acre in their system.  And the key word from both of them, was “system”.  John and Dave provided the following comments in a few categories.

“Why Wheat”  Top Three Reasons they choose to grow wheat (In order of importance to them).

Both provided very similar response:

  • Better Soil Health (proper rotation, reduced tillage, use of cover crops)
  • Better Workload Management (crop work spread through more weeks of the year)
  • Farm Operation has a Better Bottom Line when wheat in rotation. ($$$/ac)

Better Bottom Line? Both Dave and John shared their cost of production to grow a crop of wheat. They also shared their expected revenue based on historical yield averages and achieved selling prices. The surplus in this equation is the contribution margin that remains to cover land, professional service fees, and financing. John does not have access to livestock manure so he uses the wheat straw and cover crop as soil builders, and generated revenue solely from sale of grain. He consistently will generate greater than $300/ac in margin, and topped the $500/ac mark at times. Dave does have turkey manure to utilize, and does have a strong local market for straw and spring rye forage in his area. He creates revenue from sale of grain, the sale of straw, and the sale of some forage the following spring.  He consistently will generate greater than $600/ac in margin, and topped the $750/ac mark at times. These margins are independent of the gains recognized by more efficient utilization of their manpower and equipment assets. Certainly not your uncle’s “#povertygrass”.

Although farming is mostly an enjoyable lifestyle, it certainly is also a business.  As with all crops, the end goal is for farmers to make money.  Margins are increased when farmers GROW MORE bushel, and place those bushels in a plan to SELL FOR MORE.  Both John and Dave acknowledged that the best way to create more yield is to plant early.  No doubt.  The task to sell for more is a bit more complicated.  Each of them are choosing certain wheat variety that is part of IP programs to obtain value added premiums.  John uses his bins on farm to get better prices for deferred delivery of grain.  Dave moves all of his wheat to the elevator at harvest.  Despite the choice of path for the harvested grain, the two of them both strongly emphasize the importance of using forward price contracts to get the best prices for your wheat.

This is only a snapshot of the highlights.  The full presentation will be posted to the FarmSmart website (https://farmsmartconference.com/) in near future.  Please give a search for it or contact us for more information.

About the Author

Tim Meulensteen is a CCA-ON certified Agronomist with C&M Seeds. He lives with his young family at their small mixed farm in Perth County. Tim has enjoyed working in the crop inputs industry since 2001. He obtained his Bachelor of Commerce degree in Agriculture Business in 2004 at University of Guelph.