[00:00:00] Speaker A: Have you ever wondered what the price of canola could do if crude oil hits 120, 140, $200 a barrel. That's been on my mind the last couple of weeks. I bring in Steven with simple hedge. They did a little study to see what could happen. So we talk about it here in episode 115. I've also got Darren Shoresbury with 337. We're going to talk about his strategy to get two, not one, but two honey badgers on stage in Brandon Manitoba later this year. And my budd Tyler Yaremchuk with the nation network Oilers nation joins me to talk all things hockey heading into playoff season. Coming at you right now.
Hey, folks, welcome to the what the futures podcast, your quick guide to better farming decisions.
All right, folks, welcome. We had a blank on the board last Friday unless scheduled. Blank for what? The futures last Friday. So I do apologize for that. I guess that was your Friday the 13th. Yeah. I don't know what they call that, but there we are with the blank. Life comes at you fast sometimes, and there's just been kind of things one after the other here the last couple weeks. Everyone's all right, everyone's healthy, but we've been. Yeah. On our heels at the Denis household. I want to start off here just going over some positive moments. Start in a positive way because we. We have a packed show. I'm going to try to fit three people into today's episode. All right. We had recorded some stuff for last week, and I thought, hey, let's not let that go to waste. Let's get that in to this week's show. So, of course, Tyler, Darren and Stephen with simple hedge all featured here. Now, I want to start with some positivity here, some positive energy for your positive Friday.
We raised.
You raised the community.
Raised just under seven grand. Chantel and I topped it up to seven grand, but raised seven grand. Half the proceeds going to the perinatal bereavement program at the lowest hole hospital for women. The other half going to the briar patch community preschool. Again, not surprised, but absolutely thrilled and honored and thankful for everybody that put in a bid. Everybody that donated to their local programs as well, but thought about us and went and put in a bid. Tom, John, Brad, Chris 1, Chris 2, James Ryan, you know, thank you for the bids and everybody that those were the winners, but everybody that bid them up as well, thank you for that. This is going to sound nuts. All right. But what this did. So we did a little bit of social media on it, of course, the Lowest Hole Hospital foundation. They saw it, so they sent an email to me and then so they were along for the journey here the last 10 days and I got the chance to continue to talk about Eva, talk about my daughter that, you know, when, when you lose a child, a baby like you, it just doesn't come up in conversation very often. And so I got to extend talking about her. And I know that sounds crazy, but like, for me, that's the ultimate therapy for me that, that I appreciate what you guys did because it just allows that conversation to continue, that to continue to be a priority in my life. And now, you know, we get the opportunity to go and chat with the folks down at the hospital as well. And who knows what that leads to for being able to share our story and things like that. It just continues it and it really fills up my cup and it is my therapy. So thank you so much for that. I want to keep the positivity going and I need to thank David. 4 year old David Activemechuk out of Vigorville, Alberta submitted the first hat design here. Four years old.
This young man colored the hat. Of course, this is in partnership with the Canadian center for Agricultural well Being for the. With UPL egg and motions, where we give these hats, you know, to the masses. And we got our first design in for the hat making contest, which does close on April 11th.
Don't be a stranger if you're sitting there saying, Ryan, I am 58 years old. I am not designing you a hat. This isn't meant for you, all right? This is meant for your kids, your grandkids. If you're a teacher or know anybody that is a teacher.
If schools participated.
I bought an entire school in Saskatchewan last year, pizza, because they submitted like 20 hat designs. I was like, you know what, that's awesome, guys. We did a pizza party.
If you have any teachers in your life, go to Ryandenee Cat, you know, send that to them. Send this hat that they can get designed. Get them in by April 11th. And I will do my best to buy as much pizza as I can. All right, so, so let's, let's do it. Let's get after it. And thank you, David, four year old David, for stepping up. He's got some beautiful colors. Lots of blue, lots of yellow. He's got some gray as well.
Nicely done. A little combine. I can't give all the details away, but nicely done, David.
All right, folks, let's get into it here. I want to get Steve in with simple hedge markets. Are wild. Let's talk to Steven about some of the work they're doing and how they correlated the crude oil price to go with the soybean price, the bean oil price, and ultimately to that final canola number. All right, let's get into it here with Steven.
All right, folks, I've got Stephen with Simple Hedge joining me this week. Stephen, how's, how's your day going, man?
[00:06:07] Speaker B: Day's going okay. It was nice to see some of the markets come back after an absolutely brutal Monday coming over from the weekend. So I can imagine all the listeners are feeling the same way. It's a bit better today, but still needs a little ways to go here.
[00:06:23] Speaker A: Your background, like you were a merchant at one point, weren't you?
[00:06:27] Speaker B: I was, yeah, absolutely, yeah. I was a merchant, you know, both on feed grains, oil seeds, on oil itself as well. So I've, I've kind of seen the whole export, domestic biofuels industry traded on both sides of it. Yeah.
[00:06:45] Speaker A: So what would have been happening on, on your desk, do you think, if we had to, like, you know, kind of role play this? Like, would it been, would it have been hectic on your desk yesterday in that type of position? Or would you have been calm, cool, collected, just waiting for the next day?
[00:07:01] Speaker B: Yeah, I think it always, I mean, I would say every day can be hectic just because again, this is an industry where markets can go haywire at any time, especially when you have a geopolitical uncertainty that's happening. So it keeps you on your toes. But seeing a day like we saw yesterday was, you know, you don't see those ones too often.
I mean, what was canola down? 40, 40 bucks a ton. I mean, soybeans were getting pretty close to limit down there as well.
The last time I really saw anything like that was. What was that? We had canola at eleven twelve hundred dollars a ton and it limited down May of 2022. Was that 2022? 23.
[00:07:40] Speaker A: Yeah, yeah. I went down the rabbit hole of looking up like a blow off top and then the, the results of the canola market after that. And yeah, there was a couple of, of reference points back in the day that were a little bit nasty, but yeah, they're far and few for sure.
[00:07:58] Speaker B: Yeah, yeah, exactly. But I mean, to your question, it's. Those days do get hectic. I mean, a lot of the, you know, craziness, I guess you can say is coming from what's actually happening in the margin. Is the margin going to be there at any time? Because we know with commercials, it all just depends on their ability to hedge off their risk. Right. Which is actually sell the futures or buy the futures, whatever side of it they're on at any time. And when the market's moving really fast, you talking to someone that you're buying the actual physical cash from in that two minute conversation can be a very different story. By the time you actually agree or don't agree to something because the futures have just moved so much.
[00:08:37] Speaker A: As a merchant, were you up like late at night like talking to your customers and stuff like that across the world, was it like a night type of job or not really.
[00:08:51] Speaker B: Yeah, I know like, you know, same with all the producers as much just the industry itself is a 24 7.
[00:08:57] Speaker A: Yeah.
[00:08:58] Speaker B: Right. So the problem is, or not the problem, but the reason is, is it's international.
Right. Like these are homogenous products that are being traded across the world over. Right. So your corn that you're getting out of the U.S.
really, I mean sure you have some quality differences but for the most part is no different than what's happening in Brazil, what's happening in South Africa, what's happening in Eastern Europe.
[00:09:22] Speaker C: Right.
[00:09:23] Speaker B: So to know what's happening on in those areas as well is it's 247 and the markets are almost running 247 too. So yeah, you're talking to all the different offices and you know there's always massive group chats, email threads about what's happening in different locations and how they're reacting to the market at their opening, what's happening in cash.
[00:09:45] Speaker C: Yeah.
[00:09:45] Speaker B: So it becomes, comes like non stop your whole life.
[00:09:49] Speaker A: Yeah, yeah. And yeah, rumor is we may not, it may be 247 for trading here in the near future as well. We're not quite there yet, but we're darn close. And yeah, might be some of that in the future.
[00:10:03] Speaker B: Yeah.
Feels like it's 247 though.
[00:10:06] Speaker A: Oh yeah, it does. The only break feels like Friday afternoon feels like the only like real break or Friday evening maybe.
And then you start to see like, I don't know, I'm not smart enough to know what these are. But the, I don't know what to even call them. Like sometimes it's the synthetic markets or you know, Saturday morning you're, you know, there's a post saying oh well, crude in some crazy backdoor market is up 5% or 10% right now. And we're like, wait a second, it's Saturday. What are we talking about here? Yeah, but yeah, there's definitely some other mechanisms out There as well.
[00:10:46] Speaker B: Oh, yeah. Cause, like, at the same time, I mean, you don't need the markets open to be trading the cash, like the actual physical. You know, it's generally better depending on what you're trading. But some of that stuff can still be happening when markets aren't there aren't open, right?
[00:11:02] Speaker A: Yeah, yeah, for sure. So what's going on in Simple Hedge these days? Like, you're.
You guys have. Your Twitter handle's been on fire here. I was actually just chuckling because a couple days ago there's Kramer not buying the 2007 scenario. And then you guys, right, were screwed.
But what's been going on at Simple Hedge in the month of March here?
[00:11:25] Speaker B: Yeah, absolutely. Well, just all great things too, and exciting things that we have as well. So we're continuing to see a lot of growers, you know, in our places of North America that are starting to understand really the importance of risk management and the need to have that a part of their marketing decision. And that's just been such a snowball effect when you get someone in there that's starting to look at, you know, when they're. When they're seeding their crop and prices look attractive, but you have a brutal basis on new crop, right? And it's like, man, I wish I could lock in this cash.
And for the longest time. And just like anything, if you even look at equities, some of this access just wasn't ever really there or available to the average person, which, like Simple Hedge is breaking that down specifically in this ag market or ag industry to give those producers that opportunity to say, hey, I can turn to the financial side and do futures and options. So we're really just seeing a really big pickup on it.
One of the biggest things that obviously the hurdle with anything is education around this understanding because it could be intimidating at first, but that's always just kind of like one of those fronts where it comes across as intimidating and then you actually understand that, hey, this is pretty basic. If you ever hear people talk like, oh, Wall street likes to make all these fancy words and stuff for something that's really basic.
[00:12:54] Speaker C: Right.
[00:12:55] Speaker B: And that's how a lot of these financial markets are. So, yeah, really exciting. We got our Simple Hedge Pro that's about to be released here too, coming up. That's got a bunch of educational content all focused around what the producer's perspective is from, you know, people like myself as a merchant that's traded what we look for, what we're seeing in the markets, how to handle that all that sort of thing. So. And it comes with the full education, you know, market analysis, automatic contract entry as well, to really amplify that physical side of tracking. So a lot of really exciting things, Ryan.
[00:13:29] Speaker A: Yeah, good, good. Well, I appreciate that you talked about education.
Is that, is that a feature that's available right now or is that, is that coming in the next little while, the education side?
[00:13:42] Speaker B: Yeah, so we've got some education out already and it's in the app.
You know, there is some videos to get you familiar with kind of what the education would look like, how to go into that. And then for some monthly fees or anything like that, you look at, we go into some really deep dives on some full videos that get into the really nitty gritty, but from a producer's perspective, nitty gritty with that high level effect where it actually matters to you.
I mean, when you look at it, we just did a video here about taking delivery and you know, when you get into the nitty gritty of the econs of it, does a penny here, a penny there matter? Not really. But for the producer, what is actually happening, why it's happening, and that's the sort of teachings that we're, we're really trying to get across.
[00:14:30] Speaker A: I have a lot of, definitely some of the more frequent questions I get is, you know, I'm, I'm a young producer kind of starting out like looking for, you know, I get guys will be like, you know, what do you have for book recommendations or resource recommendations? Is this something? And actually even yesterday I got a message from a guy saying, hey, I'm looking for something for my partner, for my wife to start to learn and get a grasp on some of these terms and some of this stuff.
Is that kind of where you're focusing, Stephen? Like, can those individuals, is this a resource that may work for them in the near future?
[00:15:13] Speaker B: Yeah, I think that's the perfect kind of people. Like, we do it right from understanding the basics, what is a basis, what is a futures contract, really go through that. What is hedging, what does that really mean for physical and financial.
And then we go all the way into getting to advanced strategies that you can look at because we really want to make sure that it is a program that is right there for that individual that needs to learn the terms. You know, getting into farming, taking over an operation from parents, right? And hasn't seen that trading side maybe as much. And this is a way for them to really get in, learn it right from the basis and can take it all the way to an advanced level as well.
[00:15:54] Speaker A: Okay.
[00:15:55] Speaker B: Hitting all of those ones. Yeah.
[00:15:57] Speaker A: Awesome.
[00:15:58] Speaker B: Awesome.
[00:15:58] Speaker A: Well, I look forward to directing when I get those questions.
[00:16:02] Speaker B: I'll.
[00:16:02] Speaker A: I'll know where to send. Send them for sure. So that's great.
[00:16:05] Speaker B: Absolutely.
[00:16:07] Speaker A: So I wanted to talk on X here. The other day, you guys were talking about the math of hobo or boho, I guess is the right way to say it, but fueling the field, why $140 oil could send egg prices to the moon. Now, I don't want to leave it hanging on that cliffhanger, but do you want to walk us through what exactly you're talking about here, what you've kind of modeled out and some of your findings as well?
[00:16:39] Speaker B: Yeah, absolutely. So I think one of the biggest things that we need to clarify nowadays, and it's so different than what it was even five or six years ago, is the amount of biofuels. And now we have an RVO that's looking pretty. Pretty large as well, potentially, or the
[00:16:59] Speaker A: rumors go, that's coming. Right. We're recording this on St. Patrick's Day, and that's coming in the next couple of weeks or less.
[00:17:07] Speaker B: Right, exactly. And the numbers are the numbers obviously been growing as well. Just what the crush capacity is and what the refining capacity is for this. But so to the point of it is we're seeing ag commodities become very correlated to what energy is. Now. There always was a degree because biofuels and fairness have been around for 25, 30 years, but not to the amount that it is. I mean, they're talking. You're going to get to a point where it almost seems like every soybean in the US Is being crushed and that oil is basically all going into biofuels. So at that point, your soybeans are going to be extremely correlated to whatever energy is doing and where the margin is. And so that's what we wanted to bring, is that we understand that producers might not see that or understand that. Maybe you just read about it and people are saying, hey, energy's up, and so eggs up. But we wanted to dive into why that happens and why, when you saw energy get to 120, that every single egg commodity was taken off, not just your corn for ethanol, but it was your oil seeds, because of where so much of that oil that's being produced from these crush plants is actually ending up. It's no longer just in food. It's mostly actually going into fuels.
[00:18:23] Speaker D: Right, right.
[00:18:24] Speaker A: And so you started to go through, like, some what if scenarios and what did you come.
What came out of that when you were starting to do the, you know, what if the market crude goes to this level or.
Well, and actually before we get to that even like the what did you find for relationship. So where you're know, you're talking about how, you know there's more use in the biofuel space or whatever that is versus food or, you know, I don't know if I said that right. But like what did you find in that, in, you know, back testing this at the start?
[00:19:06] Speaker B: Yeah, absolutely. So one of the things was just the high correlation. It was basically almost a near perfect. So like a plus one is near perfect correlation and negative one is perfect. What is it, opposite correlation or something. I forget what the actual term is, but we were almost near a full plus one on what soybean oil was tracking to ulsd. And that was basically, we narrowed it more down to a data set of just the past few years because of where the impact or importance I would say of soybean into biofuels.
So if you went back further, you start to lose that correlation because you go back to where soybeans, Soybean oil is more focused on food. So we found almost a near perfect correlation to really the energy markets on soybean oil, which I think if you talk to anyone that's trading from a commercial side is. Yeah, that's kind of obvious. Well, it's not obvious to anyone and let's actually dive in and back it up with some facts and testing the models. So then we also wanted to take it out a little bit further and find out where beans, soybeans, the seed and canola and kind of how that fit into the equation as well.
And so we continue to run through that and we wanted to identify different levels of where WTI would get to what that meant for ulsd, which is diesel. So that's exactly what biofuels renewable diesel is trading off of.
So we got to like 120, we did it to 140 and it's not perfect. But this is just things that we at Simple Hedge want to go through and look and be able to provide an analysis to our users about things that they should be on the lookout for. That let's not just say, oh Great, energy's at 120 now. My input costs are really expensive for my fuel for my farm. And it's like, yeah, we understand that is something, but at the same time, you know, what you're producing has also just skyrocketed up in value. What type of value, what numbers can we look at at these different levels? Yeah, and so we went through that here and you know, we took like our base at the 96 on WT.
Basically we did that as our base to get our numbers right and then see if we could back test it. Gave us bean oil at was it $0.69, which is pretty well where bean oil was, right. For the most part, almost right there gave us $12.30 bushel on soybeans and 740 for canola. Now this was run right and that's where exactly soybeans and canola were trading at.
And so we tested it there and then we started to try and level it up to the different energy levels as well based off of those same correlation factors. If you got to that. And it gave a pretty interesting story I think is the key thing is where these prices could go. And it's not saying, hey, these are what's going to happen to the prices, but these are numbers to look for, right? Yeah. And then so if you're saying, hey, I think, yeah, WTI on crude oil is gonna get to 120, 125, whether it's on Brent, if you think that, then these are some numbers that you might wanna be looking at to target because that's kind of what the correlation has modeled out as.
So again, not saying this is what's happening, but it was. Let's look at some numbers that relate to AG based off of what's happening in the energy market because of how key that is and let's find some numbers that actually make sense.
[00:22:41] Speaker A: So as of recording, WTI is trading up about $3 a barrel and in the 95 to $96 a barrel range. So that's where we're at today.
So when you started looking at some of these bigger rounder numbers or kind of key numbers, what did you see? Like what did it work back to? You know, starting with crude at this level and then working your way back towards canola.
[00:23:08] Speaker B: So I guess like one of the things that we saw, and we know with Canola as well, there is going to be more of an energy premium to it because it's call it, let's just say 42 and a half percent oil content.
Right. Which is much more than your soybean oil is.
[00:23:27] Speaker A: Right.
[00:23:27] Speaker B: So the seed itself does, when you crush it, theoretically have a better oil yield for when the energy markets are off.
And you'll see even the difference when you get soybean when meal's really taken a hold of the market, you'll see soybean has a better, really essentially spread versus canola.
[00:23:47] Speaker A: Yeah.
[00:23:48] Speaker B: And so what we saw then, obviously, was canola was getting obviously a better premium really, to what their per ton value is from that side because of the higher oil content as you went up as well.
[00:24:02] Speaker A: Sure.
[00:24:03] Speaker B: And the other thing, what was kind of interesting is when we looked at it is just comparing against prior years, like this one wasn't specifically going right into a fundamentals. We were kind of looking at what some technicals are that end up trading in these certain time period markets or certain situation markets, I should say. Even the numbers that we came at out with were pretty much, much lower than what we saw at some different situations of. Of energy.
But the other thing is, when you look back at prior years, there was less crush capacity. There was less biofuel capacity as well. Right.
[00:24:40] Speaker A: Okay.
[00:24:41] Speaker B: There's lots of other things. Stronger export markets, both for soybeans and canola. I know that's kind of changed recently with China back in.
But like, you know, as you said, today, we're back up at 96 a barrel. Like, we're not seeing the same numbers that we modeled out with. Right. And that's because the export market on soybeans has significantly changed in the matter of 24 hours, and it's taken its toll on the rest of the oil seeds.
[00:25:07] Speaker A: Yeah, yeah. Apparently pushing a meeting back a month and not seeing an 8 in the tweet or whatever.
Soybean purchases from China or from the US To China certainly had an impact as we started the week, so.
[00:25:26] Speaker B: Yeah, exactly. And I think that also just even highlights when, you know, you say you have a strategy or a hope.
[00:25:34] Speaker C: Right.
[00:25:34] Speaker B: To say, hey, these prices are going higher.
The risk management aspect is that these are very marginal. I just want to make sure that I can at least protect my downside. And if the market does go higher, fantastic. I can partake in that upside.
If you're looking at put options. Right. Lock in a put option.
If the market has this instability, which it has for such a long time, or volatility, having these put options and risk, or protecting yourself on the downside, but still being able to partake on the upside is just becoming so key too.
I think you probably know even better than me when you look at it 10, 15 years ago, having a $5 move on canola was like, holy. Like, wow, Canola's up five bucks.
[00:26:20] Speaker A: All right, Steven. So, you know, I've been looking back at, you know, past years and trying to find, like, Historical references, you know, what we're going through right now, you know, how did this, when did this happen before and what do the markets do? And the, like, it could take like a month or two for the market to move like 40 bucks a ton of like, it was like you'd look at a whole year chart and you're like, wow, this thing moved like 70 bucks throughout the whole year. And we had a $40 move.
Well, one $40 move on Monday, followed by like a $35 move on Tuesday.
And, and here we are. If it doesn't move by 10 bucks, do we even look at it anymore? We're like, oh, it's not doing anything today, it's just moving by 10 bucks. Right?
[00:27:07] Speaker C: Yeah, exactly. And I think that's what's been happening a lot is, you know, it's $10 moves. People are like, oh, it's a sideways.
[00:27:14] Speaker A: Yeah, it's nothing. Yeah, it's nothing.
All right, so did. Obviously, you know, I don't know, maybe you do have the, the energy market figured out, but you probably won't share it with us if you do.
But we don't know where this is, where this is going. Right. So, you know, I saw the numbers, how you would correlate it back potentially, you know, if Crude went to 140, know, canola futures could look at a certain level, which was nice and, and big, nice, big number there. I don't know if you want to talk about those numbers at all, but I was going to ask, like, how do you, how would you treat this environment? Like, if you're sitting there as a farmer that's going to grow this stuff.
Yeah. How are you looking at it in those. Through those eyes?
[00:28:09] Speaker C: Yeah, I think that's a really good question is looking at it especially from a producer's eyes. And I think one of the best advice that I've still ever heard in
[00:28:20] Speaker B: my life is, and I know probably
[00:28:23] Speaker C: producers have heard this a lot is they know their operation and they know kind of what their margins and stuff are from, you know, on a per acre basins, all that goes into it.
[00:28:36] Speaker B: And so there has to be a degree that they want to look at
[00:28:39] Speaker C: and say, okay, this is a very profitable of these levels and it might go up, but let me lock in some of that.
[00:28:48] Speaker B: And that is, you know, if you're
[00:28:50] Speaker C: looking at new crop right now and where prices are and where prices could go, and you're saying, all right, sorry, I'm not sure where the X is at right now, but if I'm looking At Canola, let's just say it's at 740.
I think it's at 7:38, whatever, not far from that.
[00:29:06] Speaker A: Yep.
[00:29:07] Speaker B: And I say, you know what, that's
[00:29:08] Speaker C: a really solid margin profit that I can make per acre if I'm looking at what my average yield is, Great.
[00:29:16] Speaker B: And if you go and you look
[00:29:17] Speaker C: to your local buyers and the basis is really brutal, like that's fair and say I don't have to lock in a basis, I don't have to go do that and lock it in cash.
I can turn to the options market and I can find a put option that is going to make sure I'm protected on my downside. But that if this does play through and we do see 120, 140 and canola and oil seeds take off, I still get that upside.
And I had never committed actual physical tons. So that's what I would say.
[00:29:51] Speaker B: I would say you really need to
[00:29:53] Speaker C: look at what your margin is, what you're comfortable with and say is this a good value? Let me lock it in at least with a put option and if the market goes higher, great. I can partake in that upside, exit out of the put option, then go sell some cash. Or if it doesn't pan out, well, guess what, you still locked in a really high price because you had that put option on.
[00:30:14] Speaker B: And so that's, that would be my recommendation.
[00:30:17] Speaker C: If there's, as they say, if there's really good margin in it, you should capture that because a lot of the time that margin doesn't last forever. Because what happens is everyone runs into that same train and disappears pretty quickly. But if it is there, capture it or at least you protect it.
Right. For the chance that it does disappear.
[00:30:39] Speaker A: Yeah. And I think the one thing to realize too is that earlier today I had some 680 and some 690 canola puts off the knob.
And I, I ended up rolling those up. I ended up rolling that up to, to 720s and 730s, you know, was at the right call time will tell. But I wanted to raise my, my floor a little bit.
And so you know, you can look at this stuff. It's not like it's one and done. You, there are strategies that you can consider as the market conditions evolve and change as well.
[00:31:22] Speaker C: So yeah, I think you hit it on the head. There is the advantages like you said when using the options is, you know, if you have a local buyer, you're tied into that physical contract and you're going to be really penalized to exit out of it if the market's starting to get better. Right.
[00:31:37] Speaker B: Whereas if they let you,
[00:31:41] Speaker C: whereas you know, you go into those put options and stuff like it's a liquid tradable market that you can enter and exit out of.
Right?
[00:31:49] Speaker A: Yeah. So yeah, you control it. You get to control it in a market that's trading all the time, you get to control, control it and that's. Yeah, the ultimate power right there. One last one for you, Steven. So put on your old merchant hat for me one more time.
I've been frustrated because the wheat basis and even canola basis here futures rally and basis gets worse and worse. I had a Kansas City wheat futures rally of 60 cents a bushel and lo and behold my CPS price stayed the exact same at the local elevator. What is going on? What are those merchants doing to us in the background? And how would you have handled this from a merchant's perspective?
[00:32:39] Speaker B: Yeah, I think to that point you
[00:32:41] Speaker C: also have to look at what the
[00:32:42] Speaker B: time period it was because we have
[00:32:44] Speaker C: had a lot of volatility in the Canadian dollar. Right. So a weaker Canadian dollar usually entices some sort of exports. Right. And add some value to, to the growers both on, on the USD traded futures or commodities as well as on the cat one. Right.
[00:33:02] Speaker B: So if your dollar gets weaker, it
[00:33:04] Speaker C: just means it's cheaper to buy from Canada kind of thing.
[00:33:08] Speaker B: The wheat one's a tough one because
[00:33:09] Speaker C: it can just be a product that prices ran up, buyers just backed off for the time being. It's. That is what happens. Market can get panicked slash scared and sometimes the best thing is just to hold off for a second to see how things play out. Do you really want to be the person that came in and bought wheat after a 60 cent move and then see the next day off 20 cents. Right. As right.
[00:33:31] Speaker B: You know, when you're an importer of
[00:33:34] Speaker C: buying a 60,000, you know, ton vessel, that sort of thing and your basis was, was well off. So there's probably a bit of a play to that. And that would be the merchants saying okay, we need to de risk or just not take on any more risk ourselves right now. So put on maybe a not as enticing basis here to hold off on buying anything more.
[00:33:56] Speaker B: The other thing is depending on the
[00:33:57] Speaker C: time period is how full are they, you know, especially if it's in the.
[00:34:02] Speaker B: And I would say that's the same
[00:34:03] Speaker C: thing on, on with Canola as well is when you do have these massive run ups people might just hold back for the time being, lots of phone calls happening, trying to figure out kind of what we talked about earlier where you're having a two minute conversation about to get something done and the econs have changed drastically.
So it does become that people just need to sit back and see what happens. And then generally that can actually play out in the basis where it's like all the buyers have backed off right now, so we need to back off a basis till we see the next, next wave of demand.
[00:34:36] Speaker A: Sure, sure. All right, well, you're making it sound very logical and you're, you're trying to lower the temperature down for me a little bit, so. I appreciate that, Steven. I appreciate that.
All right. How could people find Simple Hedge? Where's the best spot for them to go if they want to get information on getting linked up with you guys and, and hooked up? Where, where should they go?
[00:35:00] Speaker C: Yeah, absolutely. I mean, one of the best spots is always a website, simplehedge.com and go to our website. You can set up an account on the web platform there.
You can also go into the iOS app store, simple Hedge and download the app. It's completely free for it. So you can set up your, your whole operation on there, play around with
[00:35:23] Speaker B: it, really understand it.
[00:35:24] Speaker C: You can track your physical.
If you're looking to get into more learning and education about that, I would definitely check out the Learn tab that we have and try out some of the free videos we have posted. And then if you want to take the next step to diving deeper into understanding markets and risk management, then we'll look at the Simple Hedge Pro section that has the free content, has the market analysis.
[00:35:49] Speaker A: Sure.
[00:35:49] Speaker C: All that stuff in it.
[00:35:50] Speaker B: So yeah, on the, the iOS App Store and simple hedge.com.
[00:35:55] Speaker A: perfect. Stephen, well, thanks for joining the show this week.
[00:35:57] Speaker C: Yeah, right on. Appreciate it, Ryan.
[00:36:03] Speaker A: All right, well, great conversation there with Stephen. Just breaking that down and I, oh man. Like I, I've been talking about basis and merchant actions out there and you know, I'm starting to get sympathetic now towards the merchants because it came up in that conversation as well about how, you know, they have risk and they're just trying to manage their risk in these volatile markets. Of course, each and every episode is brought to you by the great folks over at John Deere. I've been, I've been working pretty hard here the last week or so, getting, just making sure my, my contracts in harvest profit, you know, my contracts are in place, my hedges are in place.
If I've got, you know, put options or put spreads, I've been tracking. All of that gives me a whole picture on what we have physically sold, what we have hedged, and what our targets are as well. And my brother, he's been doing. I gotta get the details because he's been doing some upgrades here on some of our monitors and some of the things, some of the upgrades here. I, I need to get more details because he also had an exciting
[00:37:17] Speaker E: one
[00:37:17] Speaker A: that he got for something to do with fixing equipment. Anyways, I got to get more details on that because he was pretty excited about it the other day. Now, if you want to learn more about John Deere operations and how you can manage your farm operation anytime from anywhere, you can check that out at Deer Cat and find JD John Deere operations center there. And of course, if you're interested in harvest profit, they had a great webinar the other day, which I did not get a chance to jump on.
You can check that
[email protected].
all right, I want to talk before we get to Darren with 337, I want to talk Eating your veggies. For this week, we are workshopping names for eating your veggies. So if you have a suggestion, this is like the, like the meat and potatoes of the episode. Like, you know, 1, 2, 3. What are three things that we can kind of work on here?
If you've got an idea for a name, let me know. All right. Put it in the comments on YouTube, of course. Go and hit that subscribe button and that like button as well. Or leave us some comments. I gotta check Spotify. I haven't checked Spotify comments for a while, but we got to. Yeah, go ahead and leave us a comment as well. Let us know what you think of the show. Eating your veggies for this week. I want to start with just kind of setting. This is obviously a hostile environment of extreme, you know, volatility. But we're up a buck 47, 27 on the May again, as low as 700 earlier this week. It's been, it's been volatile. It's been a little bit crazy out there.
But I think for me, you know, it's a good idea to go. And if you have time, I can do this easily with harvest profit. But if you have time to just write down what these numbers, what the new crop canola price, you know, if you're growing three or four crops, what these prices mean to you, what they mean from a whole farm picture, what does, you know, 15, $16 canola look like? How does that impact your year what does? $8 wheat. I heard. I heard there was new crop. $8 hard red spring wheat in Saskatoon, Saskatchewan. What does that do to your bottom line? And the other crops do get that big number in front of you. And look at that. You can go with a few different scenarios and just figure out what makes sense. All right, so I like, I don't know, big picture, whole picture numbers.
Number two, you know, from a crop insurance perspective, I like getting that.
I know there's some deadlines for like, return business and stuff that have passed us, but if that didn't impact you, I do like getting that kind of dealt with right now, dealt with before it gets even warmer out and nicer out and you want to start digging the drill out, which was happening at our farm here earlier this week.
You got to dig the snow out, right, to get. To get to the drill. So just kind of finalizing at least the private crop insurance and, you know, and the provincial stuff too, but just kind of getting that dialed in. And of course, Forward protect with AGI3. Very intriguing. Go take a look at that. I talked about a cup of coffee on Tuesday.
All right, so those are kind of my first two, my third one.
Practice.
Practice your defensive strategies. I've said it on the show already, but we take the elevator. Me, stairs up, stairs up, right? Market rallies, we take the stairs up. And then you have a day like Monday, Armageddon. You sit there, you're trying to figure, why, what is happening? Why are beans down 70 cents? Why is bean oil limit down?
And what's Canola doing? Why is it going along for the ride? You know, that's what happens in this environment.
And you can't. If you sold on Friday, you feel like a hero. I sold on Friday before the drop, things look great. But on that Monday, it feels too late to execute. It feels too late to execute strategies, right? So you got to practice them. If you are preparing, you know, you want to protect yourself against. Against downside, practice what a put would look like for your farm or the different scenarios around that, around how to protect a floor. Or if you're sitting there and saying, man, I sold a lot of physical, you know, this thing dropped.
What strategies can you use to maybe reown a little bit of that risk, Right? Anyways, I just think big days like Monday happen, they're going to happen again.
Yet later this winter, early spring, they're going to happen again. And how are you prepared? You should practice. Practice how you're going to execute on those days. All right. Okay, let's get into my conversation here. Now, of course we talk about crop marketing, but Darren and his team joined us in Moosha, Saskatchewan.
A heck of an organization, thinking outside the box. I like focusing on, you know, trying to buy stuff at the right time, trying to sell stuff at the right time.
But these guys are thinking longer term and I think that's neat as well. So let's get into it with Darren from 337.
All right, folks, I want to welcome Darren Shrosbury from 337.
His podcast is usually about crop marketing. And I pride myself in crop marketing. Helping farmers make better decisions, helping farmers maximize returns on from a crop marketing perspective. But I'm also very, very aware that at some point there are other individuals that can grab the ball and also help farmers keep some of that money at home. Keep some of that money.
I don't know if I'm saying this the right way, but protect the nest a little bit here. So I'm excited to bring in Darren to this week's episode. Darren, how's your day going?
[00:43:47] Speaker D: He's going very well, thank you. Ryan, thank you so much for having me on the show. It is delightful to be here. I'm in Ontario. Don't hold that against me. I don't like the beefs very much. So they've got that, I guess. Yeah. Yep. With this good. Snow is melting, mushrooms are flying off the shelf, so life is good.
[00:44:05] Speaker A: So the mushroom farm action starts when the weather warms up. It kind of gets active for the farm as well. Or is it kind of constant throughout the whole year?
[00:44:13] Speaker D: It's an indoor mushroom farm, so yeah, it's more reliant on how many people go to restaurants. So right now, as the warm weather warms up, people are going out for dinner more often. So there's more demand for. For just general culinary goodies.
And we do a lot of culinary mushrooms. So yeah, we've seen a big uptick in volume going out of our grow up and into the restaurants. So yeah. And as soon as, obviously the weather breaks, I'll be back in the field doing all my veggies, which is sort of the summer crop and mushrooms of the winter crop.
[00:44:47] Speaker A: Awesome. Good stuff. Well, we got connected through a mutual client, Martin Cyr out of Legal Alberta.
Actually, my grandfather used to work for Martin's dad back in the day. So we go way back.
But that was kind of a neat way to get introduced. And agriculture is a small space. Right.
And so it was nice to meet you through that.
That channel.
[00:45:11] Speaker D: Yeah, it Is great. Martin's a wonderful guy. I met him at a conference a couple years back and we just became fast friends and really have enjoyed a great relationship since then. Yep.
[00:45:22] Speaker A: Awesome. So why don't you tell us a little bit about 337.
Give the listeners. I know about you. I was in Moose Jaw. You were in Moose Jaw. We'll talk about that in a second. But why don't we just let people know? What do you guys work on each and every day?
[00:45:37] Speaker D: Sure. Yeah. By the way, Moose Jaw is great. And your conference was absolutely spectacular. And I'll see you at the next one because it was really good. It was well done.
Cool.
So 337 is a farm continuity planning company. So I'm a farmer. As you know, I do vegetables and mushrooms. And back in the day when I tried to do my continuity plan, I ran into a bunch of roadblocks. So I tried. And most farmers try. They try and do the continuity plan. They contact the usual suspects. And the usual suspects are accountant, lawyer, insurance guy, finance guy, and a planner, like a general financial planner. So these five guys all have different agendas. People start sending you invoices, you don't really know what's going on right now. It's, what, early March, you know, by the time farming gets fun, you just like, I'm out. I don't want to do this anymore. I want to go farming. I'm going to grow granola, I'm going to grow wheat. I'm going to do what I know, which is farming. And the procrastination occurs for the next year. You go farming, you kick it over to next year, etc. Etc. And it just. The pattern repeats itself again and again. So we came up with what we believe is a very, very elegant and simple solution to getting the farm continuity plan done so that we can put it behind us and we can go and do what we like doing, which is farming.
[00:46:54] Speaker A: Darren, is this like, continuity plan is retirement plan? Is that the wrong way to talk about this? Is this not really about retirement, but about, I guess, what?
[00:47:07] Speaker D: Yeah, it's like we don't really use the farmers never retire. Like, we don't retire, we just die. Like in boots, like next to the combine kind of thing.
[00:47:15] Speaker A: Yeah.
[00:47:16] Speaker D: So, you know, we use the word continuity because I believe a farm is a continuity of time.
So we look at it and say, look, the older generation, they have knowledge and they have experience, which translates into wisdom. That wisdom never retires. It stays either literally on farm or they move into town down the Road, but they're still on farm because they're wise and they need it.
So if we can get a continuity plan going where it's generation one, the older generation, generation two, like my generation, like the 50s and six year old guys, and in generation three, like the younger folks, like 30s, whatever the case may be, we're, we're stewards of time. So the continuity of the farm continues through time and through the generations because let's face it, folks don't really retire in our industry. They just, because they love it so much and they just keep going. The continuity planning that we do allows people to retire if they wish and if they want to go and live in, you know, Maricopa, Arizona, where 90% of Sketch 1 farmers have a house if they want to go ride Harley Davidson's, you know that you've been there. Yeah, they can do that or they can stay on farm. So continuity means not only family harmony and keeping the family together when the referees are gone, but also just keeping it going. That's why we use the word continuity, not retirement or estate. Estate is like, that feels like death, right?
[00:48:35] Speaker A: Yeah.
[00:48:35] Speaker D: Which ultimately, yeah, we're all going to die. But the continuity of the farm, that's what our grandfathers set up, that's what our farmers, our fathers want and all that good stuff. Right. So that's what continuity plan is, is in my mind.
[00:48:48] Speaker A: So like, what, what would be step one then in this, you know, in starting to look at, you know, creating this plan? Like, where do you start?
[00:48:58] Speaker D: Yeah, it all starts with a conversation, right? So what we try and do is we try and break it down into bite sized modules. So we have a plan where there's five modules. Each module is one hour long and we do it once a week for five weeks. And that's just the planning phase. So it's easy and quick and it's very, very digestible. We also record every single one of our sessions. We then send you the recording so in case you missed it or you want to send it to your wife or your son who's out in the field or whatever the case may be, you have this recording that gives you two things. One, a, a little knowledge base that you can revisit.
And two, it sets up my credibility because I can't talk nonsense on the recorded line. I can't promise you something and not, not deliver. Right. So that's what we do. So we set up these five meetings. And the five meetings are pretty simple. Meeting number one is we do business valuation and personal net Worth statement. Business number two is we look at do you love your on farm and off farm children equally?
I, I love my own farm children more. I'm just a little bit, just a little bit gun to the head, got to go for the on farm. I'm just kidding.
So that's module two, you know, estate equalization. A farm is not a pie. You can't cut a farm up because it doesn't work.
[00:50:13] Speaker C: Right.
[00:50:13] Speaker D: You've got family and farming and you on and off farm. You know how that works. So we try and figure out what is fair, not equal. So you know, on farm kids get the acreage or farm kids get some money. The proceeds of life insurance are building, whatever the case may be. Right? So that's module two, Module three, very simple module. The will review. Do you have a will? Would you like it updated? If you don't have a will, let's get you a will. Because ultimately without a will, are you farming for the government or are you farming for your family really is a low hanging fruit. You can just get it done, it takes an hour. That's module number three. And we have your will sorted out, which is quite handy. Module number four, we look into slightly more heavy stuff, which is estate freezes and family trusts to see if that's of interest.
So basically there's three layers. You can have it personally owned, you can have it corporately owned, or you can go into the trust level.
It's basically like bulletproof, bulletproofing yourself. So if you just own everything personally, basically you're running around in your tidy whities hoping not to get shot. All right? If you're in a corporation, you got your, your car, hard gear on, you got a hard hat and you're good. If you hit the trust level, you have a flak jacket and full body armor, etc. Etc. Yeah, so that's level number four and module number four. So far you've done four weeks, four hours and farming hasn't become fun yet. So you've achieved a great many things in a very short period of time.
Module number five, we go through everything, we tie it all together. Don't forget, we send you all the goodies that you can read it, look at it, see it, all the numbers are there. So based on that, that's the plan. So that's how we start. It starts with a desire to see what's possible, right? Just to show you the universe. This is you and this is where you reside in the continuity space.
If that's of interest, we can Move to the final stage, which is the execution phase of the plan. But some people go through the whole thing, some people stop after they've got the plan and say we're good. So that's kind of what we do.
[00:52:18] Speaker A: So like, is there any themes that you can like draw from or like when, when a, a farm engages with you? Like is there something that is just glaring that you're like automatically like X amount of percent of farmers have a will? It's a small number. Like is there something that you gravitate to is like an initial? Like this is something that is missing or yeah, maybe not. Not as many people have in place already.
[00:52:48] Speaker D: What's the statistics? The statistics from FCC are shocking. So FCC said that 88% of farmers in Canada do not have a continuity plan. 88% do not. So for example, if my 11 year old came back and his result was 12%, I would consider that a fail and an epic fail at that. Right. So. And that's why we harked on this earlier. It's because they tried, but the system is set up to fail. So they fail and they go farming. Right. Which then just elongates the procrastination.
So the themes that we find is although every farmer is different and every farm family is different, that comes back to three things consistently. One, when the referees are gone, will my children still have supper together on the 25th of December? That's the main, that is number one.
And generally speaking, if you have little to no wealth, the wealth doesn't impact the harmony of the family because you have none of it. But now I've dealt with farmers for 20 years. Some of those guys were worth $5 million back in the day. They're now worth $100 million because of land value. All of a sudden, folks that didn't care about farming, that used to live in New York and do other things have popped their head up and say I'm now interested in farming.
That causes issues with the person, the son or the daughter that was on the farm for the last 20 years. All of a sudden this brother comes back and says, oh, I want to start combining.
Maybe not for the right reasons. So that is the most important thing is family harmony and making sure that when the referees are gone, the family stays together. Right? That's the crux of continuity and that's what we find the most. The second most is people are concerned about whether they're leaving a liability or creating a legacy. A lot of parents do not want to leave their children with a bunch of Debt.
[00:54:43] Speaker A: Right, right.
[00:54:44] Speaker D: They don't want that. They're like, we've. We want to turn generations of work into generations of wealth. Right. For the right reasons. Not for trust fund babies or anything like that. But they care about making sure that there is a legacy, not a liability. That's number two and number three. And all farmers resonate with this one is they don't like the government.
Yeah. Want to pay tax in April.
Yes.
Can you please optimize me from a taxation standpoint? We're not going to do anything illegal, but we want to be optimized. So can you help us with that? Which clearly we can, but that's a, that's the conversation. So it goes family harmony, family legacy and tax efficiency. Those are the three things that constantly come up.
[00:55:36] Speaker A: So just coming back to this a little bit here, but we're early December, we're in Moose Jaw. You get in front of the crowd a couple of times.
But the tax planning side or that conversation, you presented some ideas early on, on day one and that evening, late into the evening and the next morning at breakfast, they were still. There was a little buzz going on around some of those ideas and some of that discussion.
Like, you could see that, you know, the, the wheels were turning. People were thinking, having further conversations on this. Is that normal? Like, is that normal for, for, you know, that type of buzz to occur after you get up on stage, me
[00:56:27] Speaker D: on stage, or generally people talking about death and taxes on stage? Which one?
Yeah, yeah.
[00:56:33] Speaker A: Well, I'm not gonna, actually, I'm gonna not go into the death in Texas with other speaking. But anyways, you know, like the topic though and that type of reaction.
[00:56:46] Speaker D: So it's not. We, we have a unique look and the way we do continuity playing is a little bit unique. So thankfully the buzz was there and it was quite heartening.
So what we like to do is to look at is the juice worth the squeeze. So what do we do with continuity planning? As a farmer, 99.9% of the farmers I talk to, if I give them an option and I say to them, look, you can either go out, get a new combine and a quarter with some quota, right? Or you can do continuity planning with the same amount of money.
99% of farmers say, we'll take the quarters, quarters and combines every single time, right? Because they have to choose. There's an optionality, there's an option cost. I can choose option A, quarters, quarters, combines. Well, I can choose option B. Continuity planning. They know they need continuity planning, but they can't choose both because the resources are finite.
[00:57:41] Speaker A: Sure.
[00:57:42] Speaker D: So what I said to them was, this is possible. What happens if you could have both?
What happens if you could do both? People say, too good to be true. So I said, okay, well let me show you how to do it.
So the way we do it is make them not choose between their family or the next quarter that comes available.
The way we do it is often through leveraged life insurance, which is step one. The farm would send big money, $100,000 to an insurance company. We go to a bank, we get you $100,000 back, then we take that hundred thousand dollars, which is interesting, that in and of itself is good planning. But we then take that hundred thousand dollars and put it into an apartment building where we actually build an apartment building for you. Obviously it doesn't cost a hundred thousand for an apartment building cost more than that. But we won't go into the details, but we use a thing called the CMHC MLI select program, very long name, it's government related.
But we can then build a building with only like 5% down and then we refinance out in two years and we get that hundred thousand dollars back, we then put it back in the insurance, we get a background loan and we do the second building. So what we've done is we've taken $1 and we've used it twice.
Right. So that creates a lot of off farm income. Or if you don't an apartment building, you can send the money to insurance company, get it back from the bank, and for 100 grand you can go and get a very small bin from Meridian and maybe a secondhand header for the combine. Yeah, not a good one, but yeah, yeah, right. So there we go. So what we try to show was, guys, you can get your continuity plan done and continue running the farm.
Because if I say to a rational farmer, hey, just give me a, give the insurance company a check for 100 grand, the guy's going to look at me, go like, you have no idea what you're doing and you're not a farmer. Because most farms don't have free cash flow just lying around. It's going to buy inputs and all that good stuff, right? Upkeep the farm, etc. Etc. So the choice was ruinous. And that's why to a large extent, 88% of farmers don't have a continuity plan. But if I can solve that, which I think we have, that helps a lot of folks to take note because they've never seen that option before or they've never heard of that option before.
[00:59:58] Speaker A: Yeah.
[00:59:59] Speaker D: And that's what I think created the buzz in, in Moose Jaw, which was the. One of the best conferences I've been to in a long time. It was really good.
[01:00:09] Speaker A: Okay, so, Darren, I have to ask, like, why did you get into this? Like, when did you get into this? Why did you get into this? Why. Why is this. Why does it matter to you that, you know, family farms have continuity plan? Yeah.
[01:00:25] Speaker D: You know, most people that find their calling, there is a reason to it. And my reason is my family farm in South Africa. So I grew up with two brothers, two sisters and myself. So five of us, typical family farm. And my father did no planning. Zero, no continuity planning. He was a well respected large farmer in South Africa back in the day. And due to a epic, epic oversight on his part of zero planning, our family was cut in half. So two brothers, one brother, one sister and myself were on one side, and one brother and one sister were on the other side. We inherited the liability component and all his debt and the other two, because of poor structuring and actually no structuring at all because they were older than us, they got the acreage, they got the farm, they inherited all of the legacy, we inherited all of the liability.
And we said to them, well, that's unfair. Can we please, like, can you at least pay your own tax bill? And they were like, nope. So the three of us ended up paying for their farm. Right. Because otherwise our mother would have had no money because she would have been made to go bankrupt.
So our family no longer exists as five children. It exists as three and two. Those two we don't speak to. We haven't spoken for 30 years.
[01:01:42] Speaker A: Right.
[01:01:42] Speaker D: Which is completely avoidable.
My dad wasn't a bad man. It wasn't intentional. It was a mistake because he didn't have access to information.
It was, you know, South Africa in the 80s, long time ago. Right. Things were just different. So I went through that in that pain and anguish, and I'm like, well, that is totally unnecessary because I think in this day and age it's avoidable.
So put it all together and it is 100% avoidable. And that's what we try and do, is to make sure that folks don't have to go through what I went through.
And that's, that's why I do continuity planning.
When farming is not fun. When farming is fun. I'm in the forest doing my shrooms. But yeah, you're in the forest doing shrooms.
[01:02:24] Speaker A: That's what I heard.
[01:02:25] Speaker D: There.
[01:02:26] Speaker A: Did I catch that?
[01:02:27] Speaker D: It might be a different podcast. Yeah.
[01:02:31] Speaker A: Put that out under a different label or something.
[01:02:33] Speaker D: Exactly.
[01:02:35] Speaker A: All right, I want to bring up one more piece here before we. Before we kind of let you go. But you've been working.
If you Google, like Nieces and Nephews and Tax act, if you put that all together, your name's gonna pop up. Can you just give the listeners a little bit of an update on what you're working on here, what you're trying to accomplish here on a federal level when it comes to nieces and nephews farmland and the tax Act? And is that the right way to put that together?
[01:03:05] Speaker E: Yeah.
[01:03:05] Speaker D: No, you nailed it. So in my travels, because I do this a lot, so I speak to family farms up and down the whole of Canada, of course, and we have a very cool thing called the Section 73.3 rollover provision, which allows sons and daughters to inherit farmland, active farmland, and quota and combines and not pay tax on it. So you can roll over the farm without a tax bill, which is great.
So in my travels at. I'm sitting there and I'm talking to folks, and all of a sudden there's two brothers, and this happens a lot. Or there's a family and one of the owners of the land, let's say there's two brothers and one brother has no children, and the other brother has two children, right?
The brother, let's say they own 500 acres each.
The brother with no kids, if he dies, that is a sale. It's a deemed disposition of the property, which means he sold it, which means that there's going to be a capital gains bill in that sale. The brother with the two kids, AKA the nieces and nephews, they might not be able to afford to pay the tax bill on a farm they've been farming for 30, 40 years already, right? So the nieces and nephews, that farm will be cut in half, right? And it'll break down. Because as you know, farm is not a pie. You can't cut it up and divide it.
So it wrecks the farm. It can tear the family apart. It wrecks local communities because now there's less people going to the dentist and no frills and buying groceries and shopping and stuff. So it decreases agricultural food security.
It decreases rural communities. It's just. It breaks down the fabric of Canadian society. Because the Tax act has not been updated for God knows how many years. Back in the day, when there was 10 or 15 kids popping out, you had 10 or 15 choices for who wanted to farm today. Let's say there's no children that want to farm. Those nieces and nephews lose the farm for no good reason.
All we're saying is if you could update the tax act to reflect modern society, which is people are having two to four children, not 10 to 15, right, we could keep that family farm, in this case the brother bachelor brother with brother, with nieces and nephews together, the nieces and nephews would inherit the 500 acres. It doesn't cost the government anything, right? There's no cost. It just rolls over as if they were sons and daughters. So from an advocacy standpoint, I've been glad, I've been fortunate and blessed to be in this country for just on 20 years now, farming here. And if I could help Canada and Canadian farmers, of which I am one of those, to, you know, change the Tax act and to update the tax act, that would be phenomenal for Canadian farmers because we would save, literally save farms from becoming unviable. So that's what section 73.3 of the tax act is. And that's what I'm trying to do is to speak to as many politicians and more importantly on this podcast, if you are a farmer that has a nieces and nephew situation or know of any farmers, please contact me because I would love to chat to you about it. The more voices we can get heard, the more voices we can get onto television. If you want to go on TV or local radio or meet your local member of parliament, anything like that. Any advocacy where we can get rural voices to help us get the nieces and nephews added to the tax free rollover would be. Well, it's great for Canada, it's great for a rural community and it's great for your family. So that's what we do.
[01:06:33] Speaker A: Even in my own family, that is a scenario, right?
My brother's been farming for his whole career and, and you know, no kids and we, who knows? I don't know if Finn's going to be a farmer yet at 3 years old, but we play farming every day. So anyways, yeah, okay, cool. How has the momentum, how's momentum been in, in this? Cause like, are you finding some wins out there? Are you finding some ears that are perking up a little bit more? I don't know if that's a fair question, but yeah, no, it's a great
[01:07:05] Speaker D: question now for sure. We've had actually great uptick because this is a win, win on both sides of the aisle, right? Doesn't matter whether you're Red or blue, it's okay because we're not asking for money. We're not asking for a handout. So if you're a liberal that is not that well represented in farming, you can take a win for the farmer as a Liberal. As a Conservative. Well, it's an obvious win. So we've had discussions with my local mp, his name is Alex Ruff. We had a discussion with Charles Sosa, who's the Ontario Minister of Finance. We've discussed people at the cra, I forget their names and a bunch of other people. So everyone is open to listening. I actually this morning I was on the Hill Times, so I'll send you that link. But I was on the Hill Times is the newspaper. Hill Parliament, Hill, Hill Times, whatever. All the politicians read about it. So I was in that newspaper today, which was great. I was on CTV national and then I was in Saskatchewan Global as well. So there's people listening. People are starting to take notice and I think that we will get this through.
I'm. I'm quietly confident and so far no one's been negative because I don't see anyone losing here. There's no loss. It's not like we take from one to give to the other. This is just a win win for Canadian food security, for Canadian economy, agriculture, rural communities. Win, win, win. So thankfully it's not, it's not contentious.
So with a bit of luck, it's going to be.
It'll go through, I'm hoping this year or next.
But yeah, it's, it's. It's been well received. So thank you for asking.
[01:08:43] Speaker C: Good.
[01:08:44] Speaker A: Well, good on you and you know, I, yeah. Appreciate your, your efforts and, and determination to continue to voice and I'm sure it's not easy some days and I, and I frankly, I won't even know where to start myself. So good on you for taking the initiative.
[01:09:01] Speaker D: Thank you.
[01:09:03] Speaker A: All right. Now, of course I got to hang out with you in Moose Jaw, but where can people, they want to get to know Darren a little bit more and in your team, Martin and Jenna as well, you get a bunch of great folks there that, that you're working with every day.
Is there anything, any events going on or any way you know how? What's the best way to get a hold of you folks as well?
[01:09:25] Speaker D: Yes. So easiest, obviously just go to my website.
It's called 337ca. So 33 the number 7s e v e n the word CA33,7. Or just Google my name, which you can see at the bottom There I'll pop up.
We do have a very cool event. It's called Harvesting the City where we do an entire full day of going on site tours and go to the office and working out all the logistics and how we build apartment buildings. So currently we have 89 buildings that are all owned by myself and farmers and our partners. We have 616 tenants. So we explain to you how to build real estate as a wealth accumulation device as well as an estate equalization for on farm versus off farm.
So that's on March 31, Tuesday, March 31, which will be great. And then we're watching the Jays game on the on April 1st.
It's not an April Fool's joke they actually are playing.
Whether they play like fools or not, that's up to them. But there is a Jays game and we have lots of tickets. So if you'd like to come and check out Harvesting the City and how real estate can help farmers in those areas, March 31 and April 1, you can either reach out to yourself or me. And we'd love to host you guys.
[01:10:40] Speaker A: Awesome. Appreciate it. Darren, thanks for coming on the show.
I heard you were doing a little touring here the last few weeks. You spent a little bit of time down in Maricopa hanging out with some of my old pals, Derek Square. We in one of them. How was Maricopa?
[01:10:56] Speaker D: Maricopa was great. I was with DX Squire and with Rob Psych and I went to the Agri Trend House, which I know you've been to.
[01:11:03] Speaker A: I have, yeah.
[01:11:05] Speaker D: We hung out there. We went on a Harley Davidson tour with a whole bunch of great folks. And I spoke at the Canadian with a Canuck Day at the Maricopa Arizona University Conference Center.
Spoke there and then we went Harley Davidson riding, which was really cool and saw wild horses and all sorts of interesting like little gear monsters and stuff. Those were cool.
So we did that. And last week I was in Regina. So I miss Saskatchewan a lot. I love Sasky. It's literally my favorite province in the whole of Ontario. Don't tell anyone else.
I was in Regina. Then we went to Yorkton and Gerald and I stayed in Esterhazy. So that was cool. So that was last week. And then on Friday I go to Manitoba in the Elkhorn Resort for the oif so the outstanding young farmers, Manitoba. I'm speaking there at the Elkhorn this weekend and then after that back to Toronto. I mean back to the farm for a couple days and then to my house in Mexico. So it's a Pretty sporty March.
[01:12:02] Speaker A: Awesome. Well, that's good stuff, Darren. Thanks for taking some time to hang out with us. And you know, you were so gracious in Moose Draw to buy pizza for the bar the one night. Is that something we can look forward to in Brandon as well? Is that, is that one of your. One of the perks of having you at the event?
[01:12:22] Speaker D: I tell you, I wouldn't miss Brandon for the world. And because the Brandon has one word, it says unhinged.
I think pizza is below the bar. I think I'm gonna go for something a little bit more spectacular, maybe unhinged. So we'll see.
[01:12:35] Speaker A: Sounds good, man.
[01:12:36] Speaker D: It's something unhinged in Brandon.
[01:12:39] Speaker A: Sounds good. Appreciate it. Well, have a great rest of your rest of the month here of March. Have a wonderful event there on the 31st down in Toronto. And yeah, we'll talk real soon.
[01:12:48] Speaker D: Thank you very much for having me. It was great to chat. Always a pleasure.
[01:12:54] Speaker A: Well, I have no idea how he's going to pull this off with the honey badgers, but stay tuned. Of course, if you're looking to join us in Brandon Manitoba, you can get tickets at Ryandeni Ca. It is open right now. It's a long ways away. But hey, if you want to get it done and get a spot as I believe it's going to sell out at some point this fall. Always a great time with. With Darren there. All right. The show couldn't go on without support from great companies like me, Brett Young, of course, we talk canola seed most of the time, but we're here towards the end of March and I do need to shed light on Brett Young's forage establishment guarantee.
It's got a deadline coming up by, let's see, April 1st here, 2026. Order your seed and enroll in the program by April 1st.
And seed without a companion crop to qualify for 100% coverage on replacement seed.
Enroll in the program by April 30th. Seed without a companion crop to qualify for 50% coverage on replacement seed.
So if forages are your thing, there's an important deadline coming up here with Brett Young. And I am excited to have Mark join me on the show. Next week. We're going to talk a bit more about forages.
Pasture cattle markets are fun.
And not that we'll talk cattle, but let's talk about the feed side of that equation. All right?
Okay. Okay.
Now we've got one more guest. We've got Tyler Uramchuk to go here. So let's.
Let's do Tyler After Tyler, I'm going to talk about what's interesting for me and crop marketing right now.
And then that will be how we end episode 115.
So let's get into it with Tyler Yuremchuk and talk all things hockey.
All right, I got Tyler Uremchik joining us here once again. Tyler, man, it's Friday. How's your week going?
[01:15:03] Speaker E: My, My week is going good here. We're post trade deadline in the hockey world. So that means, you know, there hasn't been a chance of me having to like, fire up a stream at 8:30pm because the Oilers make a trade or something like that. So I'm relaxing now.
[01:15:16] Speaker A: I'm chilling, cruising motel playoffs. Good stuff, Good stuff. I want to obviously get your take on the war in the Middle East. You know, why don't we start with half?
[01:15:26] Speaker E: How's it affecting the global markets? You're the only guy I know who can explain these things to me.
[01:15:32] Speaker A: It's chaos. It's absolute chaos. The price of crude oil last, you know, Sunday night just spikes like crazy.
It. It makes a move that we have never seen before, ever. And that's how strong of a move it made. Just that one night, then the next day it completely falls apart. And then we. We gained, I don't know, momentum all, all week. But, you know, you drive down the road, you see the price of fuel right at the, at the gas station like that. That ain't going away anytime soon.
[01:16:03] Speaker E: So that's not ideal.
[01:16:05] Speaker A: Yeah, so it's gonna be. It's gonna be expensive. And until they get this little waterway opened up, the Strait of Hormuz, until they can actually open that up and, and get more oil flowing and more fertilizer and energy products.
Yeah, it's. It's tough. It's. It's gonna be expensive. So it's for my, you know, the farmers listening to this pod, like, there's pain. The stuff you buy to farm is more expensive, but the stuff that we're growing has also gone up in value. So it's actually been probably slightly beneficial overall.
[01:16:39] Speaker D: So.
[01:16:39] Speaker A: Yeah.
[01:16:40] Speaker E: Anyway, so hopefully hockey can. Can be a necessary distraction then because the hockey's getting good. Like, it's crazy. The deadline happens and then it's like, boom, we 20. Less than 20 games to go for all these teams. Like, the stretch drives on.
[01:16:52] Speaker A: Like, I've needed something to decompress at night and so like people like, why don't you just read? Well, I'm reading about middle, like war in the Middle east shit. Like about what happened in Iraq in this year I ran in 1977, I'm like, wait a minute, I got to do something different. So anyways, hockey Talk is a great start.
What are your trade deadline? Like, who was your winner when it was all said and done, when the dust settled? What, who's the trade or the team that won the trade deadline for you this year?
[01:17:24] Speaker E: So I, and I really don't like giving like Fence City kind of answers. But the weird thing about it, and hey, we'll talk about the hockey market now. The hockey market was in a really, really weird spot because there weren't that many teams who were true sellers and the teams that were true sellers. You know, you look at St. Louis, who was shopping around the Parecos and the Robert Thomases, Jordan Kyros of the world, all the guys St. Louis was shopping, were shopping. They all had term on their deals, which means St. Louis was under no pressure to just dump them. Like usually what will kickstart and fuel the trade markets in the NHL is a really strong rental market. A bunch of guys who are pending free agents, who bad teams are just looking to offload to get something for. A bidding war comes and then boom, you end up getting guys getting moved for first round picks. But like the rental market was so weak this year that all the focus was on guys with term and the teams who had these guys were holding firm on their asking price. So what we got was a ton of inactivity around the league. The only real big, big names that moved, Nazem Kadri right at the end. It was actually an hour after the deadline. We heard about it. He went to Colorado and it's hard not to like that for Colorado and call them one of the winners. They're, you know, I won't say far and away the best team in the NHL, but they're the clear number one.
When you look at the way the season's unfolded, the fact they added him and Nick Waugh is such a, you know, they have a glut, a glut of riches in that forward group. It's crazy how good they are. So the abs are an obvious winner. I liked what the Islanders did. Going to get Braden Shen again. He comes with term as they move into this new competitive era with Matthew Schaefer on their blue line. Hard not to like that. Getting a guy who again is a good vet who's going to help you for a couple of years now, good Saskatchewan boy as well. And honestly, not to be like a homer, I kind of Liked what the Oilers did too. They went and addressed an area of need. They are struggling defensively. They're struggling to keep pucks out of their net. It's too late for them to fix their goaltending again. So get guys who are going to help you prevent high danger chances. Jason Dickinson, Connor Murphy, they do that. The Oilers paid a lot to do it, which is why I'll stop short of saying they're winners and that I love their deadline. But they added in an area of need and didn't just add flashy pieces so that they can puff their chest out and say, look at these. This 25 goal scorer, we got like, they got guys who fit specific needs. And I always think that's a smart strategy this time of year.
[01:19:45] Speaker A: Yeah, I hope those defensive style players, I hope that kicks in a little bit more here because last night was rough. So any big, any big losers out there where you were like, what the heck? Why didn't you do anything? Was there anybody that really surprised you?
[01:20:02] Speaker E: Vegas made some moves earlier in the year, like picking up Rasmus Anderson, which is a trade I didn't love. And then all they did was add Nick Dowd at the deadline. A fourth line center didn't love what Vegas had cooking up. The other one that was confusing for me was, was Minnesota, just because they're in that Central Division. And earlier this season they made that all in move to go get Quinn Hughes from the Vancouver Canucks. So you push all these chips in the middle to go get Quinn Hughes. You have Caprizov and Boli and Ericsson, Ek and Faber. Like their goaltending is good. They are. They would be leading every division in the league except for the one that they're in and they're in third place. And they're kind of a distant third place team compared to Dallas and Colorado. But they were in the market for a top six centerman. And if they would have gotten a top six centerman, I would have said, hey, they're now in the conversation with Dallas and Colorado. They didn't do that. So I think Minnesota fans have a reason to feel a little. Have a bit of a sour taste in their mouth. Like, oh, we went all in in November and then we didn't make that next necessary move to truly push ourselves into the elite conversation. And the other team who's the big loser is Detroit. Last year, Steve Iserman, their gm, he got called out by Dylan Larkin for not doing enough at the deadline and everyone kind of pointed to them and we're like, all right, if they don't make the playoffs this year, Steve Iserman is getting fired. Todd McClellan is getting fired. We knew the internal pressure from their captain, Dylan Larkin. He made one move. He added Justin Falk, didn't add anything to their forward group. And now you're sitting here. They are going to be without Larkin for two weeks. They're going to be without another one of their forwards, Andrew Kopp, for two weeks, the former Winnipeg Jet. And they're only two points up on Columbus for that final playoff spot in the East. And Columbus has a game in hand. Detroit has fallen flat on their face, and I think it's pretty, pretty easy to point to like that locker room lost all its momentum when their GM once again didn't properly add to the team. So Red Wings fans I think have good reason to be like, legit pissed at how this deadline unfolded.
[01:22:01] Speaker A: All right, fair enough. Now, is there a team outside right now, outside of the wild card spots that you look at and say, all right, yeah, they're out by three, four points, but they're coming, they're going to squeak in on this thing. I see Ottawa. How does Ottawa always fall out of this wild card picture? When I refresh my screen, what's going on over there? Anybody in the west where you think they've got a chance to, to run here and get in
[01:22:28] Speaker E: Ottawa? Ottawa was starting to piece it together, but goaltending let them down earlier this week. They're five points out, they're six back at Detroit, but they have two games in hand on Detroit and they have a head to head game still against each other, I believe. So I'm not going to, I'm going to say Ottawa and Columbus are the last two in the east who have a shot. I'm not a believer in the Philadelphia Flyers, so I kind of like the vibe Columbus has had since their coaching change. They've been one of the best teams in the NHL. They have a little bit of that, like, youthful energy, too. So I'll say if anyone can knock out a Boston or a Detroit, I'm going to say it's Columbus. I think Ottawa's goaltending is going to sink them. And the funny part about the Western Conference is just that they, they're sitting here and no one wants it. Like all the teams who are chasing.
Winnipeg only has four wins in their last 10. Nashville, Louisiana. Seattle, only three wins in their last 10. San Jose has gone 4, 4 and 2 in their last 10. And they have gained ground on everybody like no one wants it in the west. It's pretty. It's pretty crazy. Like, earlier this week I came to. I kind of made a big point that, like, I think the Winnipeg jets can make this thing interesting and outperform a Seattle or a San Jose enough down the stretch to get back in the mix, but then they go and lose back to back games to close out the. The work week. So it's like, I don't know, no one wants it. That's another good thing if you're an Oilers fan or if you're even a Golden Knights fan. Like, you're sitting here being like, well, thank God no one else wants it because Edmonton and LA and Vegas continue to sputter, but everyone below them has been just as bad. So I think if you, if you go kind of gun to my head, who's going to get that eight seed? I'll say San Jose, just because the math favors them right now. But it's. It's a bit of a pillow fight.
[01:24:10] Speaker A: And they're kind of fun to watch too, right? San Jose is fun to watch. Anaheim's fun to watch. I know Anaheim leading the Pacific at this time.
All right, is there like an overrated team for you? Like a top team that you sit there and say, these guys don't belong. When we get into the first round of the playoffs, they could be in trouble. Does anybody stand out right now?
[01:24:33] Speaker E: I always want to be a Carolina Hurricanes hater just because, again, their style of hockey is very good in the regular season, but in the playoffs, I really don't enjoy it. But analytically, they've been a bit of a darling this year. So I have a hard time finding a way to hate on Carolina.
I'll throw a little bit of shade towards the Anaheim Ducks right now, who everyone's kind of pointing at and being like, they're young, they're up and coming, they have all this skill, but a lot of their flaws are very similar to the flaws of the teams that they're going to have to play early in the playoffs. Like, everyone points to Edmonton's goaltending, everyone should be pointing more at Vegas's goaltending. Over the last six weeks, Anaheim's goaltending has actually been just as bad as the two of them. And while a positive for the Ducks is that they're the only team in the Pacific Division who's won more games than they've lost this year, they aren't a team that's just racking up loser points like Vegas. They're also the only one out of Vegas Edmonton and Anaheim. The Ducks are the only one with a negative goal differential this year, so I just think they struggle to keep pucks out of their net. I think they're going to run into one of Edmonton or Vegas early in the playoffs, and I think the experience factor is just going to be too much to tip the scales the other way. So Anaheim's kind of the one where they're a great story. Maybe another team who, if they would have went and got a cadre or another big piece at the deadline, they got John Carlson. He'll help the blue line. Yes. But if they would have gotten another piece up front, a veteran piece, I'd believe in them a little bit more. I'm not a big believer in the Ducks.
[01:26:02] Speaker A: All right, fair enough. And it looks like I was just checking the point spread between the Habs and the Oilers. 10 points now between them. Habs with 82, Oilers with 72. My dad continues to lead that.
Yeah, he gets to gloat a bit more now. One last one for you, Tyler, before we let you go. Blue Jays, it's obviously spring training or whatever they call it, Grapefruit League or Orange League or whatever it is.
How you feeling about the Blue Jays here? Because I think we're not far from the opening game of the season. Right. We're getting close.
[01:26:37] Speaker E: End of March, exactly two weeks to the day. Friday, the. Friday the 27th is. Is the day things kick off for the Toronto Blue Jays. They open their season at home with the Oakland days. They're really, really good again. Like, last year was kind of like the, whoa, wake up call for the rest of the. The major league. And I know they lost Bo Bashette, but they added Kazuma Okamoto from Japan, one of the top Japanese free agents on the market. This year. They signed Dylan Cease, who was the best free agent pitcher on the market. They were trying to do some other things, but early on in spring training, there's been some really, really encouraging signs. Dalton Varsho, their center fielder, he's in a contract year. He's looking like he's made some swing improvements. Addison Barger was their breakout youngster last season. He is looking like a beast in spring training. Like, this guy legitimately might hit 30 to 35 home runs this year based on how he's looked in the spring. Vladdy at the World Baseball Classic has been crushing baseball. So Vladdy looks like he's ready to have a good regular season. That's something people forget about. Last year, Vladdy had a really bad regular season. He didn't hit a home run in the last month of the regular season, then went absolutely scorched earth in the postseason. So there's a lot of reasons to be really positive about the Blue Jays, but baseball is honestly one of those sports. It's the hardest regular season to predict. Like the Dodgers, I'm sure are going to be good. But even last year, the Dodgers were a super team that couldn't win their own division. So baseball is very unpredictable. But what I like about the Blue Jays, they went out this year and they signed a whole bunch more pitching depth. They brought back Max Scherzer. They signed Cody Ponce, who was the best available pitcher out of the Korean Baseball League. They signed Cease. Like I said, they. They have a really good pitching staff and that's usually enough to carry you through whatever inconsistencies your batting lineup can have.
[01:28:19] Speaker A: All right, sounds good, man. Do you have any trips planned for this spring to go see the Jays or is that kind of a summer thing for you?
[01:28:25] Speaker E: I did up the first time today with my wife, but I'm also, as you know, a big Buffalo Bills fan and they're opening their new stadium next year. So I'm looking at one of those weekends in September to maybe do a Blue Jays Bills trip. And it's another great reminder why I love my wife. One of the many reasons why I love my wife is because she's just as excited to go on this trip as I am. So, yeah, looking for that. Maybe in September when the baseball means a little bit more, you know.
[01:28:49] Speaker A: Well, have fun in Vegas. That's coming up for you right away. So have a good time in Vegas and appreciate you taking some time for us this week.
[01:28:55] Speaker E: Yeah, we'll chat with you again in a few weeks. And, and you know me, I will find a time. I will find a way to have a good time in Vegas.
[01:29:01] Speaker B: 100.
[01:29:02] Speaker A: Take care.
Well, my Oilers have strung together a couple of victories here lately. So we are, we're cruising, we are cruising into getting into playoff mode here in Edmonton. Crop marketing.
There's one thing here now I get, I'm going to do. I'm going to present to some farmers on Thursday of this week. So by the time you listen to this, I will have been in front of these guys. I've presented three years in a row to this group, so I'm excited to do it once more. But there's one thing that just lingers in the back of my mind and that is this blow off top. I've been talking about this with the lunchbox crew. But on that Sunday night where crude just skyrockets to 120, we have this big, huge gains that night.
And for all intensive purposes, looks to me like it's a blow off top.
I don't know what the exact definition is, but it seemed to make sense when I googled it.
I looked at past events, past blow off top events and like Canola specifically, and I didn't like what I found when it came to, you know, looking for a higher market above that. You know, if canola hits 760, for example, you know, how long did it take for it to go higher than that? So I look back, there's like the 2008 example, which was a bit strange because then there was the banking crisis. And so Canola dropped a pile. I think it was like 150 bucks a ton in five sessions or something like that.
There was a couple other events. I don't have the dates in front of me right now, but I was looking at all this and I couldn't find an example where the market went higher.
In One example, that 2008 when it just fell off kind of a cliff and didn't recover.
Another example we had was, was 2022 and it gave us a lot of chances like it, it kind of blew off, dropped and then it rallied again and we had a few chances, but never higher than that point.
And so I sit here and I, I read and what everyone else is reading about the Middle east and the war and maybe more troops and boots on the ground and bigger targets, bigger infrastructure being impact. I would think that energy has more room to go and to climb and that will bring Canola with it. But this blow off top, man, like I don't know if you had a chance. If you're listening and you looked it up and found like a counterpoint to mine, I'd be curious to see it because I kind of marketing like I don't know if we make a higher level than that 760. I hope we do. I got a lot more to sell. But there is still some weather stuff going on. Wheat got excited. Well, kind of exciting, right? So there's some weather stuff going on, some dryness in the western winter wheat belt, some terrible crop conditions in Oklahoma and Texas as well.
So that's certainly catching my attention.
Anyways, the spliff top is definitely here on my mind.
All right, folks, I appreciate you hanging out this this week.
We'll be back Tuesday with cup of coffee. That's been fun. And I also have got a couple new analysts joining the mix here.
I. I'll hold off on those announcements, but a couple new analysts coming into the mix here at what the Futures A Cup of Coffee, which is always exciting to get some additional perspectives. I think that's it for this week for the what the Futures podcast. My name is Ryan and I'm out of here.
SA.
