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  • Goodmorning and welcomeAlthough I feel like I know most of you, I will introduce myself nonetheless. My name is Theresa Richards and I have been involved with ACORN in various capacities since 2007. Prior to working for ACORN I completed my undergraduate degree from the Renaissance College program at the University of New Brunswick, during which I was fortunate to travel and learn about organic agriculture in Bhutan, a small kingdom in the Himalayas. My interest organic agriculture has been growing for some time and began as a result of working in health food stores for over 5 years. After spending an amazing season of experience working on a multi-faceted organic farm, I also harbour dreams of farming someday. In 2009, I completed the International Organic Inspector’s Association Basic Crop Inspector Training course, and currently, I am back in the ACORN office working as NB ACORN coordinator–implementing the Strategic Plan the sector established just over a year ago.This morning I’ll be presenting on the results of the organic field crops and marketing study, and in particular on the emerging opportunities I noticed as I was completing the study. The project was the final stage of three-year funding provided in part byAgriculture and Agri-food Canada and the Maritime ACAAF (Advancing Canadian Agriculture and Agri-Food) Councils as well as ACORN and the OACC.This presentation is based on the market study, which is in the final draft stages, but as often the case, keeps needing to be updated as new opportunities come up. Even just talking with ShondaBabineau from Co-op Atlantic yesterday showed me how quickly things can change! intended this market study to be a guiding document for developing the organic filed crops sector in the Maritime and as I was writing this collected information, I kept the producers in mind, my hope is that, although it is a large document, I hope it is and remains a useful document for you.
  • About the survey: the 2010 survey was expanded this year to include questions about the reasons for growing organic field crops, various crop production aspects, including varieties seeded and yields obtained, and asked several questions about markets and future production plans in addition to the annual harvest information.The survey was sent out to all of the known certified and in-transition field crop producers, and overall it received a 60% response rate, with most of the responses coming from PEI (15)–about 55% of the organic producers, 8 responses in NS and 7 responses from NB. Top crops-80%-Wheat, Oats, Soybeans and BarleyAvg Acreage 110 acres – 500 being the highest and 4 being the lowest–with about a 50:50 ratio
  • So, where are people selling their grains? According to the survey results, displayed on the graph here … Quebec: bypassed for Ontario … receiving a higher “Not likely” score, though a couple of people expressed interestLanguage barrier, but also the perception that they grow a lot of grains already, and aren’t in need of ours.Discuss further …
  • Really though, which comes first, the crop, or the livestock … Do we need to supply a surplus of grains to encourage organic livestock production Or will the sector be able to provide for a growing livestock sector if there is demand?In the meantime as we try to decide, organic Livestock production has not grown much: from 24 organic livestock producers in 2006 to 26 in 2010–and most people doing this have to grow their own grainsYou think it’s a challenge to grow and market grain? Well … let me tell ya something: Limited market for $$$$$$ feed grains or grow your own (add to the work)Market the meat elsewhere? Federally-inspectedI won’t ask people to raise their hands for this one, cause I bet I wouldn’t get an honest response, but I bet not many of the grain producers here really know their COP for each crop and I think this is a part of the livestock problem–I think some of the livestock issues could be addressed by having more grain producers aware of their COP, so they can figure out what feed grains grow cost-effectively in order to sell grains for the local feed market and still make a profit. Easier said than done eh?Regardless of the issues, there are some people who are making it workNova Scotia Eco MilkJuly this year2 certified producers4 waiting and ready to transition when market builds10 tonnes of feed/month to supplement 1 producers’ dairy feed needs–this may not sound like much, but if all … 480 tonnes/year, which is more than Co-op Atlantic currently purchases … The success of Nova Scotia’s organic dairy industry is definitely going to have an effect on the grains marketThese are the potentially emerging markets, Now let’s take a look at the regional markets
  • Who is the largest regional purchaser of organic grain?Let’s take a look at the next slide …
  • You might be surprised to discover that the largest purchaser of organic grain is Walter Clark, a PEI organic hog producer. Next is ….Complete documentation of the regional Maritime buyers, including all of their purchasing information, requirements and prices (where provided) are included in the appendix. In addition to the four purchasers listed above, it tncludes Balance It Inc., Barnyard Organics, and Western Nova Agro-Commodities Ltd.
  • According to results of the Maritime Organic grains survey (which only account for 60% of growers) a total of 1385 tonnes of grain were harvested in 2010, although 3350 acres were in production. This doesn’t account for few crops that would have been sown in the fall for a Spring crop. In comparison, the total grain required for 2011, as projected by regional buyers, is around 1430 tonnes. This represents a small difference, but let’s look at this in more detail, and break it down by crop: (slide)
  • Here, in order of demand, are the feed crop requirements of the regional purchasers. When looking at the last column, you see the difference between what was recorded grown by the 2010 harvest survey, and what was in-demand from regional buyers. This helps to showcase what crop requirements are not being met locally. For example … Note that oats were apparently over-produced for the regional market demands.Now we’ll take a look at a similar table for food grade grains
  • There are a lot more negative figures than in the last column in this table, demonstrating that regional demand was being met by regional production for the most part. Exceptions represent small tonnage amounts, but may provide incentives for farms with smaller acreages to grow extra in order to supply these limited markets. The asterisksSummary: Overall, there is room for more coordination for growing for food grade crops in the region, while there needs to be a concerted effort to meet the needs of feed grains–with the largest purchaser having to look outside the region to purchase organic corn (which is preferred over a combination of wheat and barley). Not only will NS dairy be looking for affordable organic feed grains, but Walter Clark is already looking for some … Why cost of production information is so important!
  • With a limited regional market, it makes a lot of sense for farmers to look outside the Maritimes to diversify their market base and to reduce competition amongst local producers.Good idea to have a variety of purchasers lined up for your crops–don’t put all of your eggs in one basket… However, being at the far eastern edge of the country, and by no means as easily and expansively productive with our grain crops as our Canadian prairies, it simply doesn’t make sense to look too far beyond Ontario. In addition, it appears that beyond this, any markets that might be interested in purchasing from the Maritimes would be comparing us to the productive prairies–meaning for one that they would very likely be looking for quantities that Maritime organic producers cannot supply. Minimum shipments are by the container or full tractor-trailer load (20-30 tonnes). Increased shipping amounts make it more economically viable and the Maritimes simply are not producing the volumes to fill this market.So like most people seem to do–we’ll by-pass Quec markets for the moment to talk about Homestead Organics:***Homestead Organics Within 2 hours of Berwick is their priority and they are continually working to try to support increased production in the area, the Maritimes can’t rely on them forever as a buyerThat said, in an extensive interview with Tom Manley, he did express great interest in continuing his purchases from the Maritimes, and he strongly encourages Maritime producers to be in contact with him before they plan and plant to discuss his purchasing requirements, contracting and what crops they should consider. Once again in the appendix… Another point of significance: expand in 5 years!Other Ontario markets who access the world market are discussed in appendix
  • The Maritime’s Canadian neighbour province of Quebec, however, does offer some prospects, and should not be considered a by-pass market!Table 5 clearly shows the overall rise and fall of crop prices on the marketplace. Corn capturing lower price than it did in 2006the only crops that have not risen and fallen dramatically in the past five years are the specialty crops: canola, hemp, flax and buckwheat. Canola has experienced a 13% price increase from Spring 2008 until Fall 2009; hemp has experienced a 10% increase since 2005–with a seemingly temporary dramatic drop in price in 2008. Flax, from Spring 2008 to Fall 2009, has jumped with a 42% price increase and buckwheat increased by 47% from Spring of 2006 until Fall of 2009. Speerville prices?Once again, although QC is growing a lot of their own grains, and has a well-established organic field crop sector, QC buyers were time and again interested in sourcing products from the Maritimes–both for local consumption and international export. Included in the appendix is a comprehensive list of the Quebec organic buyers contacted for this report. All but one of these organic-only buyers were interested in diversifying their market base to include the Maritimes. For a list of all Quebec field crop buyers (conventional and organic) you can consult the website of the Fédération des producteurs de cultures commerciale du Québec
  • In french: they have a complete list of buyers of organic grain crops in Quebec that can be found at this websiteAnd: Federationd’AgricultureBiologique du Quebec also has on-going price information, which is what informed the previous graph, and they are updating the price lists twice a year.So rather than by-passing Quebec, I would suggest that we have a lot to learn from them, and in fact I will be coming back to discuss more about the unique initiatives taking place in QCSo this is a brief overview of the most accessible Canadian markets outside of the Maritimes, let’s take a look …
  • What’s happening:DonnaYoungdhal, Org Marketing director of the Cdn Wheat Board, claims Canadian organic grains are in low demand: Kazakhstan, Hungary, Argentina are now growing cheaper organic wheat alternatives and supplying the European markets.Barriers: Quote on screen: Acreage sizes are a barrierVarying organic standards and lack of equivalencyInternationally, how Canada is perceived is important–traditionally, we’re well received, but it can be a fickle marketEurope is looking for high protein, hard-red spring wheats (b/c they mix into their grains) as well as canola (both organic and non-gmo)Another factor on the world market is that Western Australia recently lifted a moratorium on GM canola … despite the fact the 90% of non-GMO canola crops grown in the region were sold to Europe under the auspices of it being non-GMO, because that’s what European markets are looking for. This represents an opportunity for the Maritimes to step up to meet some of these market needs–especially on PEI, where isolation could provide an excellent protection against GMO contamination. As mentioned earlier, several farmers are already working towards these GMO-free markets, and the dream of having PEI become a gmo-free island may just be a profitable one!Japan: regulated markets means tariffs are applied to some imported foods such as wheat and soybeans. The Maritime coastal advantage: ocean freight cost-effective, according to Youngdhal, shipping costs could be as much as $70/tonne lower than shipping from the Prairies.
  • Considerations: tractor trailer loadsU.S. exchange rateGrowing grains sector
  • Despite the issues discussed, New England still represents a promising market for Maritime crops–the organic livestock sector experienced a 101% growth rate between 2000 and 2008, whereas the corresponding grains industry (which was almost nonexistent in some states in the first place) has only grown by 78%. This means: New England needs feed grains!New England’s feed needs are already being supplied by Canadian producers, but so far, rarely from the Maritime Provinces. Quebec’s President of the Syndicat des producteurs de grains biologiques du Québec (Union of Quebec organic grain producers), Pierre Labonté, claims that New England was one of their top markets for organic grains over the past several years. In addition, Saskatchewan’s Farmer Direct Co-op has been shipping loads of feed grains into New England, despite the costs of shipping a distance of over 3,000 kms. There is major potential for Maritime producers to be supplying this bioregional market, and more details are discussed in Appendix A in the section on national and international buyers.
  • Explain this sectionWhen performing the research for this market study, I became very interested in other people’s solutions to issues Maritime organic farmers are facing as well. I also noticed that there are some gaps in the production-market chains that could be an opportunity for the right entrepreneurs.
  • Listed here is a brief summary of the opportunities identified in the market study. In a moment, I’ll go over key crop opportunities and “exemplary models”, but first briefly I’d like to discuss the other points.How many of you are growing your own seed for your field crops? One hand: how many of you are filed crop producers, put up your other hand if you grow your own seed)That’s about representative of the overall seed production in the Maritimes. Many growers are sourcing their seed from outside of the Maritimes (there are no regional sources for certified, pedigreed, organic seed in the Maritimes). This presents both an issue and an opportunity, as organic pedigreed seed is selling for between 150-180% more than food grade–although the actual tonnage of seed required would be relatively small, I do see an opportunity for interested producers to coordinate a seed growers co-operative to meet the region’s needs and develop varieties meant for the Maritime unique climate.That brings me to the next bullet:Direct Marketing. Traditionally, people don’t think of grains when they’re picturing direct market sales of organic food–but trends are changing, and there are several producers in the Maritimes successfully direct-marketing grain and pulse crops. There is a niche-market for people who eat grains whole, or who have their own home grinders. Although it may seem like small acreage, it can have a big impact, for example, Grain CSA’s have started popping up too, and the Kootenay grain csa in BC, in its first year of operation–grew from 200 shares to 600 shares, tripling in size in one year. CSA members receive approximately 100 lbs of grain for $125.00. This means that the producers are selling their top grade grains for approximately $2,500/tonne: for bread wheats, spelt, oats and lentils. In the Maritimes, we’re limited by our small population sizes, so a similar venture may not be quite so popular, but it does illustrate the fact that direct sales can be profitable. Another consideration is that BC has no Speerville Flour Mill equivalent…
  • Remember, this is a market study–and although I am aware that many things are easier said then done, I thought it would nonetheless be helpful to look at the different crop opportunities from a marketing perspective, but I realize these crops are not for everyone due to production issues, weeds, equipment and so much more. Buckwheat: Buckwheat came up repeatedly while researching for this study. This is a crop that readily grows in the Maritimes, is suited for crop rotations and captures a higher than average market price. In fact, in Quebec, it experienced a 47% price increase from 2005-2010. Buckwheat is in demand in Quebec, Ontario, the United States and even overseas. Unfortunately, there is not much of a demand for buckwheat on the regional market, but Speerville is considering adding Maritime-grown buckwheat to their product line, since they currently purchase it out of Quebec Canola: Canola is a high value oilseed crop that also grows well in the Maritimes. Japanese and European markets are increasingly seeking out non-GMO canola, and Australia, by recently opening their doors to GM varieties, have potentially threatened their stronghold on these markets. Oilseeds: Foxmill has had trouble sourcing their crop needs in the Maritimes, and it may not seem like a huge market, the crops Foxmill is looking for capture a high market, and are in-demand elsewhere as well. In particular, flax, sunflower seeds and canola (as listed above). Although each of these crops have their production complications, if a producer was interested in specializing, or pooling resources with other producers to meet the demand, there is a market for the products. Corn: This study used acreage to determine the largest crops of the Maritimes, and although overall acreage reported by the survey responses was only 63 acres, the recorded tonnage was 300. Corn may not capture a high market price when compared to other grains, but with strong yields and a guaranteed market, it very well may be a crop worth investigating. Walter ClarkShondaBabineauwith Co-op Atlantic claims she has to outsource corn every year in order to meet her feed mix needs. She would much prefer to purchase it in the Maritimes. Western Nova brokerage thought they could sell organic corn without trouble Another consideration for those who want to support the livestock industry and keep their grains regionally consumed, is the fact that the largest grain purchaser in the Maritimes–Walter Clark–is actively seeking out organic feed corn for his hogs. If any other conventional hog producers decide to follow Clark’s lead, the market for corn will be significant. Jonathan McClelland, from Western Nova Agro Commodities, stated that he thought organic corn would be an easy commodity to sell on the current market. ShondaBabineau with Co-op Atlantic claims she has to outsource corn every year in order to meet her feed mix needs. She would much prefer to purchase it in the Maritimes. Although there are obvious challenges to producing corn (specialized equipment for harvesting and drying, and weed management and high-nitrogen requirements), it is possible to grow corn in the Maritimes.Although there are obvious challenges to producing corn (specialized equipment for harvesting and drying, and weed management and high-nitrogen requirements), it is possible to grow corn in the Maritimes High Protein Crops (peas and beans): Once again, there is a limited market regionally for these crops, but it is nonetheless one that is not being fulfilled. For food grade, Speerville hopes to be working with producers this summer to produce locally grown beans, and they are not the only market looking for these crops. Sophie Martel from the MeunarieMilanaise in Quebec was eagerly anticipating the day she can purchase organic pulse crops, and strongly encouraged Maritime producers to look into the viability of growing them. In addition to beans and pulses for the food-grade market, the livestock sector is looking for high protein crops as well. OACC has done work on mixed barley and peas as a complete feed source. Fava beans were another high protein crop in demand in New England–as an alternative protein to soybeans (gmo contamination). “We’re frequently looking for high protein crops, especially fava beans,” says Luke Zigovits of CROPP. More research may need to be done to test the viability of fava beans for commercial production in the Maritimes. Hemp: In 1998, there were 576 hemp producers in Nova Scotia and New Brunswick, none in Prince Edward Island. As of 2009 however there are 39 hemp producers (none are organic) and all of them are located in PEI. Hemp might be a crop worth exploring in the future, as there seems to be a stable and growing Canadian market for hemp products and the price recorded for December 2009 by the FABQ was up to $2,420/tonne, an increase of 10% since 2005, despite the drop in the market price recorded in 2008. Licenses are required to grow hempAlso–notice which crops failed to make it on this list?
  • CUMA:Cooperative d’utilisation de materielagricole: or a Farm equipment sharing Cooperative buyers outside of AC are looking for consistent products at large volumesHarroWehrman of Wehrman Farms said it clearly when he said, “Get organized, get some good processing established and focus” In particular, he thinks there is a great market for Maritime buckwheat and canola, claiming that most buckwheat is coming from China and that’s poor quality and expensive. But, in order to meet the demands of the worldwide market, Wehrman was adamant that producers should pool their efforts by growing and marketing together. He wasn’t the only one to recommend this either. In several cases of interviews with companies with international connections, it was recommended that Maritime producers consider working together to gain leverage on the market, but also to establish the region as a unique place with unique products. Donna Younghdal, Organic Marketing Director with CWB suggested the same thing and Raymond Loo has been attempting to do just this with Anne’s PEI farm on the island. He has been developing markets for grains in Japan, as well as gmo-free canola oil and by-products in Europe. Other examples of collaborative marketing are found in Saskatchewan and the U.S.In Saskatchewan, Farmer Direct Co-op is a 100% certified organic and certified fair trade marketing cooperative with 60 farm members–mostly field crop producers, with some livestock as well. They export their products all over the world while investing in regional infrastructure to improve the local market potential. They have had great success marketing their products collectively, as it has enabled them to reach markets and provide benefits no individual farmers could have accessed alone. Another amazing and successful example of a farming collaborative model is found in the U.S. called Organic Farmer’s CROPP co-operative. It is a Organic Valley (a dairy cooperative)’s response for the need to support grain producers (who supply grains to the dairies). They have over 1617 members. Although the co-op took off initially as a dairy co-operative, in 2008, it expanded to allow grain producers to become members of the co-op in order to supply the livestock feed needs under the “Grower Pool”. Essentially, Organic Valley buys directly from grain farmers and has the infrastructure to handle all of the grains, so the farmers don’t necessarily have too–this allows them to buy and store whatever grain products they need, while making it pretty hassle-free for members. How it worksGrowers may enroll as many acres of organic crops as they like and will have a guaranteed price via a 3-year rolling contract. Growers enrolled in the Grower Pool will have priority access to all future sales to CROPP Cooperative for as long as they wish to remain members. Key elements of the Grower Pool:1. Mutual commitments made via three-year rolling contracts2. Sixteen crops eligible for enrollment3. Full membership in CROPP Cooperative including voting rights4. A transparent regional pay structure5. Voluntary acreage commitments6. Farmgate pricing with no marketing or transportation responsibilities7. CROPP Cooperative as actual buyer
  • The recommendations are suggestions–where I and my colleagues, Andrew Hammermeister and Beth McMahon saw opportunities to expand and develop the sector as a result of the information gathered in this study. I wasn’t able to provide the full background on each recommendation in this talk, but soon the market study will be available online and the results will be more widely shared. In brief the recommendations are:Industry-chaired committeeFABQ’s modelField toursWorkshops on optimizing grain quality: mgt, storage and handlingEquipment sharing Feasibility study should be completed to examine the potential creation of a grain/livestock co-opRegional grain buyers should offer incentives for quality and variety preference which would offer positive reinforcement and push innovationTo entice new entrants, detailed COP analysis for different crops under organic management should be developed for distribution to conventional grain groupsThe final culmination of the market study is a list of 8 recommendations, based on the positive and potential opportunities for growth outlined briefly this morning. The recurring theme throughout the recommendations is the concept of collaboration–a term Maritime producers have historically exemplified and I trust will continue to lead the regional organic sector.
  • Presentation mogn

    1. 1. Organic Field Crops Market Study<br />Emerging Opportunities<br />By Theresa Richards<br />
    2. 2. Field Crops Sector Profile <br />Generated from the 2007-2010 Harvest Survey Results<br />
    3. 3. Preferred Markets<br />
    4. 4. Grain & Livestock Interface<br />Chicken or Egg?<br />
    5. 5. Who is the largest purchaser of organic grain?<br />
    6. 6. Regional Market<br />
    7. 7. Total tonnage harvested (survey results): 1385 mt<br />Total tonnage required by regional buyers : 1430 mt<br />Maritime Tonnage<br />
    8. 8. Total Tonnage Purchased<br />
    9. 9.
    10. 10. National Markets<br />Quebec & Ontario<br />
    11. 11. Quebec Markets<br />
    12. 12. Federation of commercial grain producers’ Buyer’s List (in french):<br /><br />Union of Quebec Organic Grain producers (french):<br /><br />Quebec Resources<br />
    13. 13. International Markets<br />“They like larger volumes and long-term contracts” – HarroWehrman, Wehrman Farms, Ontario<br />The challenges<br />Europe<br />Japan<br />Northeastern U.S.<br />
    14. 14. Considerations: tractor trailer loads<br />U.S. exchange rate<br />Growing grains sector<br />Northeastern U.S.<br />
    15. 15. U.S. Grains/Livestock<br />
    16. 16. Summary of Opportunities<br />
    17. 17. Seed-production<br />Direct Marketing<br />Key Crop Opportunities<br />Exemplary collaborative models<br />Summary of Opportunities<br />
    18. 18. Buckwheat<br />Canola<br />Oilseeds<br />Corn<br />High protein crops<br />Hemp<br />Key Crop Opportunities <br />
    19. 19. Equipment Sharing<br />CUMA<br />Grower and Marketing Co-ops<br />Farmer Direct Co-op<br />CROPP<br />Exemplary co-op models<br />
    20. 20. Recommendations<br />2010 Maritime Organic Field Crops Market Study<br />
    21. 21. Thank You!<br />