Episode Transcript
[00:00:00] Speaker A: Hey, folks, welcome to episode 33 of the what the Futures podcast. This week we're talking to Nick Horeb with Harvest profit. We're going to talk Farm financials. He's a smart guy. Hang in for that one. I'm also going to give you a little bit of advice around how to sell the rest of your old crop grain. And then we're going to talk about converting contracts when you look at spreads in hard red spring wheat, talking about protein spreads, grade spreads, we're going to talk about that towards the end of the show. Check out each eating your veggies as well. We're due for a reset here. Episode 33 coming at you. Stay tuned.
Hey, folks, welcome to the what the Futures podcast, where we break down complex market trends into simple, actionable advice. It's your quick guide to better farming decisions.
All right, episode 33. Here we go. As per usual, each and every week recorded in the UPL studio, we're going to chat a little bit of rocksar fungicide later this episode. That's our next contest, so hang in for that one. Of course, what the futures is your weekly dose of clarity in the complex world of agriculture and crop marketing. We'll say, right? My name's Ryan Denis. I am your host of the podcast, and I've been working in agriculture for the last 1415 years. Something like that. I've been a grain buyer, grain marketing advisor, and an analyst as well. And taking the show on the road here with what the future. So thanks for tuning in this episode. We're gonna dedicate most of the time to a conversation I had with Nick Horeb with Harvest Prophet. That is a farm financial software, as it says on their website, cost and profit tracking software for savvy farmers who treat their farms as a business. So that's the bulk of today's show. But I've had a lot of people ask about what do I do in regards to selling the rest of my old crop grain. So we're going to talk about that in just a couple minutes. We'll get to that first. Money. Money. That's what we're going to call it. Of course, we have our winner of our hockey pool. We're going to give away another cool bucket cooler and Bluetooth speaker from pioneer seeds. You can see the bucket cooler here is actually just behind me. I'm kind of blocking it. And the Bluetooth speaker, this guy is a breakaway speaker. It's pretty neat. If you're watching on YouTube, you're going to be able to check this out.
But those all showed up last week. So we have a new winner for the month of June because it's already the last episode for June. Summer is here. Summer is happening. And yeah, we're here we go. If you are enjoying the show, you can stay up to date by subscribing to the YouTube channel or subscribing on your favorite podcast platform. That helps me out as well. So if you can go and hit a like button, a subscribe button, throw some comments my way. Let's have some conversation. I certainly appreciate it. Now, each and every episode of what the Futures is sponsored by John Deere. Well, I'm super excited for egg in motion.
Last week we were talking air carts and great conversation. I learned a whole bunch, just like today's episode with Nick. I just continue to learn, which is great.
But my brother sent me a message after listening to the episode, and he's like, dude, we use task manager all the time. He's like, I put all of our notes are in task manager on fields. So I think I fumbled that a little bit. A little bit last week when we chatted air carts. But anyways, we got John Deere operations on the farm. We got harvest profit keeping us organized here. And message from John Deere. You know, connections matter. Connections to family into your land. But what about your tractor or your combine with John Deere operations center? You can connect your machines and effortlessly stream your data into one secure place. Check it out at John Deere, Ca. I'm excited to also hang out with those guys at egg in motion.
Now we've got a little bit of housekeeping. So speaking of egg in motion, I am bringing with me. I don't have yet a stack, though, a stack of t shirts. I'm spending Tuesday and Wednesday of the show with UPL in their booth. They're even going to let me set up a podcast studio, remote studio. I was chatting with my editor, almost editor team. There's a few people involved in that team about making sure I had the right equipment for an outdoor setting. And I ordered some new microphones for that. And my marketing folks have helped me order some, some stuff as well. But we're, we've got a stack of t shirts coming, all sorts of cool colors. We've got kids sizes as well. And I'm going to give those away in the UPL booth Tuesday and Wednesday morning for like an hour each morning. Cause I have a packed show, okay. And what I'm doing is I'm looking for the coolest farmer at egg in motion. So come get a t shirt. I'll share what they are on social media right before the show. They're, I think they're pretty neat. So you come to the UPL booth, I'll set up some times for that. Grab a t shirt and we'll get to more details in the future. But I'm looking for the coolest farmer at the egg in motion, of course, hockey pool Willingdon Wildcats, Greg's team. He pulled it off. We knew he would, but he pulled it off and he won the 24 2024 NHL playoff pool. So we've got a little prize bundle for him. We've got prizes for elite, our round one winner, Causeway, who had the worst score out of everybody that participated. And then short sticks had a great round three. So we'll get those prizes out in short order. I've not been doing very well in shipping out what the future is gear. So I am going to do, I'm going to pick up my socks here, put in a great effort. I owe people on Twitter stuff I owe these guys stuff I owe. I owe stuff all over the place. I'm in debt. And what the future is, gear across the prairie provinces. I will do a much better effort this weekend and get things packaged up in, out the door. Get caught up here for July 1. All right? And last thing for housekeeping.
And again, it's a call to action from you. What the futures is looking to partner with an organization looking to raise some money for a community project.
All you have to do is email Ryan at what the Futurespodcast dot ca. We'd like to help you raise some money for that project. The deadline to get this submitted is July 1. Okay, so put it out there, send it to me. Let's have a look at it, and let's see if we can help you raise a few more dollars for your organization. Okay. I'm recording Wednesday night and it's a delicate balance. I've recorded this episode. This is the second time, the first time I had Internet issues. So we're taking another run at it here. And I'm on also on daddy duty while recording. So I got the baby monitor here and I am multitasking. So kids are sleeping. So far so good for episode 33.
Positive moments for this week. Well, I'll keep going with the kids. We went, we were camping here. It was my birthday, and my wife brought ice cream cake, dairy queen ice cream cake to the lake. And the effort to go and order that cake and put it in the camper freezer, you know, and bring it out to the lake. That's a pretty good effort on my wife's part. So that, that's one of my positive moments, having that ice cream cake at the lake. Of course, camping was great. Weather was really good for us. The kids had a blast. Now, switching over to farming here a little bit, and I know that Upl has fungicide, and we're going to talk about rocks are later on, but my positive moment is when people, when I talk to farmers across the prairies, and I know it's not perfect everywhere. There's still areas of drought and there's areas of too much precipitation, but there's a lot of talk about applying more, and it's fungicide is one of them. When I hear people talking about applying fungicide, I start thinking, hmm, there's some potential here. There's, you know, we're adding more, we're spending more, we're, we're going after it. There's good potential. That's a good sign. I also got a couple calls about top dressing, you know, putting on more fertilizer. That's a good sign. And so people are looking, they're making plans. They're trying to do everything they can to get more yield, and that's a, that's a good thing. We've got some good weather for a lot of folks out there, and we are setting up knock on wood. I don't want to jinx it on the show, but there's some dandy potential out across the prairies. My third positive moment, my final one, it's the calm and the time that has been bought by those of you listening that have done a bunch of crop marketing here in the month of April and May and maybe early June as well.
When I chat with farmers, you know, a lot of them say, oh, darn it. You know, I wish I would have done just a little bit more. Sure. But I talked to a lot of folks that have a good amount of 2024 bushels priced, and they also took a pretty good chunk of 2025 off the table as well. So when the market drops a dollar or so, you know, they sit here and they're calm. They bought some time and they're not concerned. And I think that's, for those of you listening, you might be sitting here shaking your head, saying, yeah, that's how I feel right now. I bought myself time, got a good start, and let's see where this goes. And that's positive to me. I think that's great. Okay, let's switch to the hot topic of the week. Let's do hot topic of the week. So let's do our next contest here for, with Upl for Rocksar. Then we'll bring in Nick. And then what? We're going to wrap up with the, the mail bag and eating your veggies. So that's how we're going to lay this out here for the rest of the episode. Now, my hot topic of the week, I'm getting multiple questions. Well, multiple farmers asking the same question.
What do I do with the rest of my old crop, grain? And I threw this on Twitter, you know, earlier this week saying, hey, I'm going to talk about what to do here. And it's the time of year where crops are, they're nowhere near made, so they're not made, but they are very well established. And for cereals, I would say that we have an understanding now of what that potential could be. Again, they're not made, but they are established.
So with that, we have people that, farmers out there that will, quote unquote, sweep out the bins, right. They've been holding something. And now that the crop is coming along and we're well into the growing season now, sweeping the bins is a term that you'll hear out there. Markets have dropped. Not all markets, not flaxen. I think chuck talks about canary seed hanging in yet, but wheat, canola, soybeans, corn, barley, oats dropped a little bit. A lot of crops have dropped. And there's also this convergence of or prices converging from old crop values to new crop. So they're getting lined up and it's old crop that's under pressure more than anything and new crops not really climbing. You know, you think about like a green pea, maple pea, green lentil, crops like that. And so here's my advice for the hot topic of the week. Crops that have a large premium today, this is the easiest layup. This is a no brainer. But if they, the crop, old crop value is much higher than new crop, just pick up the darn phone and get the deal done. Make the sale. Okay. I don't know what you're waiting for anymore, but if you're sitting here with like a green pea or a green lentil or maybe even a yellow pea, that's going down $2 a bushel by fall, new crop gets your sooner. I know crops are delayed, but new crop gets here sooner than you think. And don't be that, don't be that far. That, that waits too long. You can even look at it with basis on, canola and Wheatley. Now it's the end of June, early July. But as a, when I worked in the grain elevator, what would happen for us is again, you're getting two or, well, maybe it's different now, but we get two or three trains a month, usually three out of four weeks, we'd get a train and then head office would send us a plan and say, this is what we want you to fill with at harvest time.
This can's going to be canola, this can's going to be wheat. This can's going to be feed barley, whatever it was. They'd give us a plan.
And in between there we try to kind of ship out, empty out the elevator, most elevators, I think maybe all of them, probably all of them do some type of audit and wait. So you want to be as empty as you can be when you do your audit. You need space to move that stuff around and to do weights. And so you'd have that lull and then all of a sudden, you know, mid August would show up in my part of the prairies and sooner for other parts. But northern ish Alberta, central North Alberta would harvest was on, right. And you had to stick with that plan. So that's a long way of saying like the delivery window here for old crop, it's there and I'm not scared about it per se. But when you can get an extra dollar for your wheat today, you know, I would be making sure I have that basis locked in, which is holding that premium because we're off the same futures month now. We're off September or December or November. Canola.
So for Canola lock, get that basis established for a week. Get that basis established. Don't lose that into new crop. In fact, one of the things I used to like doing at this time, and it's a little bit sensitive, everyone gets a little sensitive over this stuff.
But there was, I'm going to go on a bunny trail here. I apologize for this bunny trail. But there were years where I'd phoned farmers up and say, hey, then it's not this year because crops are delayed. But hey, when are we going to harvest this wheat? Or what's the chances of getting something off in August? Because there was this big August premium and in canola as well, in early September, we'd get this, this premium and we go and grab that. And when I see prices that have the chance to drop just in basis a dollar a bushel, like wheat, for example, dropping a dollar a bushel by fault, I don't mind doing a little extra, you know, someone's going to offer me $8 for old crop. I darn it, I did an extra load or two. I'll get it to you in late August or early September. Now the grain buyers listening to this are going to cringe. They don't like that. But there's times there was years where I wasn't too worried about it and I'd get a little extra done anyways. So you gotta take advantage of crops that have a larger premium.
Today that's the easiest one. Just get that stuff done. Guys, quit messing around.
And like someone asked me, hey, I got wheat to sell.
Substantial amount, I thought, but I've got some wheat to sell. What would you do? Well, from a futures perspective, oh this disgusting to think about locking in a basis contract for old crop.
It makes me sick to my stomach. But then you sit here and say, well geez, aren't we going to get some type of bounce? Aren't we going to get some type of technical recovery? Isn't there going to be some fundamental event that happens that just rallies us a little bit? It might, it could happen.
But if I go back to a couple of reference years, 2014, I've talked about a lot on the show.
Spring Wheat July 1 to August 1 loses sixty five cents a bushel in 2009. It's dead even in between. There drops, but then it comes back but it's dead even in 2009.
Kansas City wheat, same thing. You think Kansas City probably has more potential because the US harvest is behind us, you know, by the time we get until mid July. But it was even as well in 2009. No gain. I, when I look at canola, they dropped $40 a ton in 2009, so there's no guarantee. And I think I talked about this last week or maybe the week before, but rallies, they're not going to feel like rallies unless it's a big India is importing more wheat than we thought or it's a big event. You know, I know a lot of guys are talking about the us heat and I totally understand a very hot summer is bullish. But with moisture events and heat, that bullishness may not come down until we get the actual production totals after harvest.
So what is that, a December report?
You see what I'm saying? It may not be instant here, but for me, I'm going to be disciplined. My favorite thing to do on canola, like today in central Alberta, Cargill cameras was at $14 a bushel, a 68 cent premium over their posted bid. I just take the 14. Thank you take the 14 and I'd buy a call. If I wanted to stay in this market and be bullish, I'd buy a call. If it was about trying to maximize revenue, well, then I'd sell the 14 and I'd buy a November or a January put. Like that's what I would do to turn 14 into 15. There was even, I was listening to a us analyst the other day and they're advising their clients.
Now, again, folks seek the advice of a professional. This is, you know, just for conversation.
But they're doing double puts. They're doing, instead of 5000 bushels, for example, they're doing 10,000 bushels because they're trying to get their, their clients to break even on soybeans. So they're doing double the amount of volume in puts to increase the value, try to increase the value, get closer to breakeven doing double what they are producing.
Like that is wild.
But again, if I'm trying to turn $14 canola into something better, my fear with a call option is that you're just, the money just blown away. It's just spent and gone.
So I'd rather see you put. And at least with the put, you can say, wow, that's a little hedge against new crop. That's a little hedge of, that's a little new crop I don't have to worry about. And at Vitera, at Cargill, you could sell it at whatever price you're, you're seeing and then add a put. And maybe that put makes you a bit of money down the road with wheat, I'd say that where basis levels obviously are worth grabbing, in my opinion, you get the delivery opportunity. But when you go to look at the future side of this equation, I know that we all want to grasp that hope and grasp that chance that futures are going to rally this summer.
But at this point, if you said I'm going to clear out, I'm going to shop around my volume, get my best net price, and any rally that happens in July and August and later on, I'm going to just focus on my new crop and on my 2025 crop, I don't think that's a bad idea.
Like why, why would you say, take a basis, stress yourself out all summer if it doesn't rally? Plus you probably don't have as much new crop sold as you want for 24. Maybe you don't have any 25 sold yet either. So you got three years that you're facing pressure on. Just end the bleeding on 2023. Move that along. Focus on 24 when the market rallies, and on 2025.
But I do think you got to act sooner than later here on some of these markets. Now, this is insane. I'm recording this Wednesday night, the eve of a stats can report, which can be a game changer, hopefully positive by the time we listen to this, but can also be negative. And by the time you listen to this, the USDA report is probably out as well.
So maybe next week I'll be saying, oh, you know, this, and this happened, and here we go. But no, honestly, folks, it's time to clean up and take action. Now, feed grains, I know, barley, feed wheat.
You could throw oats into the mix here as well.
I'm just seeing on the feed side, little spot opportunities. So, for example, smaller volumes extracting bigger premiums. So what I mean by that is, I went out with 100,000 bushels of feed barley to find a market for it. Okay, I got something in the $5 range picked up.
When I cut that down into loads of five, that price went up to 525, 528, and 530, because a few buyers were like, oh, I could take a. I could take five loads. I can't take 100,000 bushels, but I'll take 10,000 bushels. So that's something you can look at as well. Sometimes smaller volumes make more sense, but I think feed grains have to be sold. Guys, I don't know what we're waiting for on feed grains. On barley's feed wheat, you gotta just get that done. I think wheat, you got to move on from completely get it done.
Canola again, you can sell and buy a call. You can do the same thing on wheat, but I'm just worried you're blowing that money into the wind. And, of course, if it has a premium today, do not mess around. Get it done, get it sold. Don't let it fall further into new crop. All of you have a different situation, different cash flow needs, different business plan. Everyone wants to be do the best and succeed. Some of you can hold grain for multiple years. I never market based on that.
I think that that is the least common situation out there. And I always move green out in the. In the year. So I'm not a big carryover guy, you know, back in 2122-2021 more than anything, 22, I turned bearish in March. Right? So in 23, I was bearish, too. So anyways, you know, there. You can make a case there for some of those. But anyway, I'm not going to go down another bunny trail. That's it. That's my hot topic for this week. Hopefully that helps you make some decisions.
Okay, so I don't have a UPL guest for. For this week. Brock sar. It's what we're giving away here for the next two weeks.
So it's 80 acres per week. Okay. So nice volume there.
So, rockstar is a fungicide.
You use this on your wheat crop. And you've listened to the podcast in the UPL studio. I know you have. And I know that we sold wheat in the high eights, in the nines, in the 950s.
Heck, you may even have done a little bit of $10 wheat out there for winter of 2025.
Now it is time to protect that wheat with rocks are going to protect you against diseases like fusarium. Okay? Oh, man. I don't even want to think about the fusarium years on the farm. But anyways, the way to get entered for this week, let's do a crop rating. But let's. Let's use emojis. Cause you're gonna get a little upset with me if I ask you to rank your wheat crop from a one to five, five being excellent, some of you are gonna respond and say, ryan, you're selling this information to stats can. You're selling it to the government. I am not giving you my rating. I don't care what your rating is. I hope all your ratings are five and that your potential wheat potential is the greatest it can be in that you grow the biggest crop and that you sell it before the rest of the market realizes it. Okay, so what? Let's do this instead. Let's do an emoji. You can. You can tell me about your crop using an emoji. It can be what we call it, like the chocolate ice cream one, you know, in our household, the chocolate ice cream emoji. It could be a thumbs up. It could be a clown, a Christmas tree. It doesn't really matter. What it's going to do is it's going to give me your phone number and contact information so that I can put your name in a hat and I can draw for a winner. For rocks are 80 acres of fungicide for your wheat crop next week. So you have to get those into me by Wednesday. That's going to be what, July 3?
Get them in by noon on July 3. Text it. 1855-606-1889 your personal emoji, crop rating of your wheat crop. I will tally all the ice creams, all the thumbs up, all the gold stars, whatever emoji you send me, and I'll try to give you a ranking on the crop from. From those emojis. You can also email them to me if that's easier. Ryan, at whatthefuturespodcast dot ca. And if you say, you know what, man, I don't even know what an emoji is. I don't know what you're talking about. Well, then you can just say, hey, Ryan, my wheat crop looks dandy, or whatever you want to say. All right, so let's have some fun with this one. UPL has been giving away products here. We did battalion. We've done wave, which is still behind me on the desk here. And now it is rockstar time now, fungicide to use on your wheat crop. Okay, now let's turn it over to my conversation with Nick Horeb from Harvest prop.
I've got Nick Horeb. Nick, am I saying your last name right? I'm terrible with names. So is horeb the right way to say you are? Hey, there we go. Getting better. Well, welcome to the what? The Futures podcast. Nick. For those tuning in, you may have noticed over the last number of months and throughout my career, I've been focused on farm financials, using platform software to help you make those better crop marketing decisions. Harvest profit has been a part of the journey for our farm here over the last year and in the past as well. Excited to have Nick on the show. Nick, how's your week going?
[00:27:17] Speaker B: Week is going good. Yeah. Getting, you know, right at the beginning of the summer here, so we're. It was a pretty warm, you know, we didn't have much of a winter in our part of the world, so now we're, you know, just getting tons and tons of rain here in eastern North Dakota. But things are well, we're working on improvements to harvest profit and talking to customers and helping people with some rotation decisions. Given a later planting this year in big parts of North America.
[00:27:50] Speaker A: Yeah, 100%. I'm a little bit further north from you, but same thing. We had similar weather patterns, lots of delays this year. Some of my good friends still out there planting crops right now. You're a great follow on on X. I still like to call Twitter, but on x, and, you know, your range the last couple of weeks here has gone from. And I think it was today or yesterday you were talking about the Greeks. You know, I feel like I know you. We've never really had a conversation before. A little bit of email back and forth, but the Greeks, they actually caught my attention today. Can you just give me. Before we get into harvest prophet, just give me a little background on what that was all about.
[00:28:30] Speaker B: Yeah. So I've really. Well, just touching base on Twitter.
I'll still call it Twitter for the foreseeable future. It's been fun for me to share tidbits personally about harvest profit and then just about business in general. It's been a really good avenue for me and us to spread our vision, but then also to just try to put interesting, interesting tidbits out there. And so you're referring to a post I made today on, on the option Greeks. And where that came from is we have a neighbor at the lake who's a, you know, I would say near retiring. He's an aeronautical engineer and he lives on the west coast. And he really wants to, I get the sense he's quite interested in the business side of farming. And so I've thrown a couple problems or situations his way to think about calculating cost of production. And here's some prices for inputs, and here's what the usage rates would be, or the as applied rates. And how would you calculate that cost of production? He's just super into this analytical business of farming stuff. And he was talking, picking my brain recently about hedging and talking about, do farmers use options?
And so then I started telling him, you, a lot of farms use options, but there tends to be some frustration and maybe just a little bit of a lack of foundational understanding. And we started talking about the Greeks, which would be four different variables that help quantify what the value of an option is. And I've pretty much trained myself over the last decade that if anything interesting happens in my life, I kind of log it. And I'm pretty liberal about posting stuff on social media, things that can just provoke thought, get people thinking, and really trying to add value to people is what I've tried to abide by in my career, and it's been hugely beneficial. And sometimes you have some interesting conversations from time to time, but for the most part, it's been a big boost to harvest profit.
A lot of fun for me and people on our team as well.
[00:30:57] Speaker A: I definitely bookmarked that one today because I want to get back to it after and read it a little bit more because you had all the definitions and everything in there. So that was great. Or how it was all. How it all works. So anyways, I appreciate that.
Let's keep going on. Maybe your background a little bit.
Where did you start and how do you get harvest profit?
[00:31:19] Speaker B: Sure. So I grew up in northwest North Dakota, town of Williston. So our family farm is actually 1 mile east of Montana in about 30 or 40 miles south of Canada. So a very similar crop rotation to a western canadian farm. Spring wheat, durum, chickpeas, lentils, you know, some canolas becoming more prevalent, a little bit of soybeans, but really small grains and pulse crop. Heavy rotation. But I wasn't actually too involved in the farm growing up. My dad, my uncle managed. He worked more closely with the farm, and my dad took over my grandfather's construction business.
And my mom's side of the family, my grandpa farmed as well, and my mom's half brother took that side of the farm over. And so I would, you know, on my mom's side of the family, I'd go and, you know, pick rocks and do some little odds and ends. But really I was more of a little, you know, city kid that would come out to the farm and go hunting. And, you know, they probably saw my pickup drive up and thought, oh, no, here again.
[00:32:32] Speaker A: Yeah.
[00:32:33] Speaker B: And so then I graduated from the University of Minnesota with a degree in finance, like 1516 years ago now. And then I worked for a private equity investment firm in Minneapolis where called Shoreview Industries, where we would acquire businesses mostly from retiring entrepreneurs.
So somebody's ready to retire, you know, maybe they want to transition from a day to day leadership role to more of a chairman. You know, we would help come in and acquire a majority of the business, keep them involved.
[00:33:06] Speaker A: Okay.
[00:33:07] Speaker B: And through that, I got to see a lot of interesting businesses. You know, what traits did we look for? What would we avoid?
[00:33:15] Speaker A: I.
[00:33:15] Speaker B: And just got to talk to lots of entrepreneurs. So this is the late two thousands. So about this same time, the price of Minneapolis spring wheat rallied from $5 a bushel to $25 a bushel. And here I am thinking about both sides of my family. That farm had some friends that farmed and talking to friends and asking questions about what are you doing with your wheat, and how are you taking advantage of this?
I had an underappreciation for the complexities of the farming environment that I grew up around. And I quickly realized that, well, these are bigger businesses than what I had thought when I was real young. There was still a heavy prevalence of summer follow. So you'd leave half the farm. You'd only plant on half the farm.
As no till became more prevalent, that pretty much went away in our area. And so you had more cropping, continuous cropping. Revenues went up, costs went up, just more dollars flowing in and out of these farms. And I didn't realize how big of a business it was. And so I, being kind of the numbers nerd that I am, I dived in and started learning about, you know, well, if you wanted to take advantage of these wheat prices, you know, how far out can you go? Can you hedge? You know, then there's forward contracting and then the production uncertainty. Well, then I spent, you know, a couple weeks in the evenings understanding how crop insurance worked, at least in the, in the US, and, and then started talking to people I knew from college and back home. And there was just a general, I don't, I wouldn't say complacency is the right word, but more of they don't really know what to do. And as I was asking questions about, well, what's your cost of production and what are your crop insurance guarantees?
I quickly realized that a lot of the people that I knew that farmed had to wear, let's just say ten different hats on the farm, from operator to bookkeeping to hrtaine agronomy. And the business side of the farm likely wasn't the strongest link for many of those people that I knew who farmed in the northern plains. And so I stumbled across a group that was doing consulting in the I states. It's called market wise AG and I linked up with them and started doing consulting in western Minnesota, in the Dakotas, doing a lot of work in spreadsheets.
I quickly realized that the spreadsheets that we were working with, I tinkered with those and got them in really great shape. But as soon as the sun started warming up and the fields got black and the crop is ready to get put in the ground, those spreadsheets would tend to just gather dust until the following winter. So we put our budget in good shape, and then all of a sudden you get to the next winter and you'd realize, well, the rotation changed. I didn't contract as much. I bought more inputs, and this great budget we had would just be completely irrelevant by the time winter came.
I started tinkering with just looking at different software solutions and how are other businesses handling this? And realized that most farms using some sort of bookkeeping software in the US, Quickbooks desktop was the prevalent tool. Well, that gave you historical analysis, really no budgeting capability.
And then for the average, I know in Canada, accrual accounting is much more prevalent than it is in the United States. But in the United States specifically, you have transactions from three separate crop years that tend to go into one calendar year. You're pre buying inputs, you're selling crop from the previous year, and what farmers were showing on their financial statements just completely irrelevant to what was actually happening on a crop year basis. Even the farms that were doing accrual accounting and a good job of accrual accounting, still just looking in the rear view mirror, and it often doesn't get down to enterprise level and field level profitability. And so I started tinkering with harvest profit ten years ago now to try to find a tool that could help my consulting customers keep the thumb on the pulse throughout the year. Add in their sales, add in what they actually did in their operations, see how that impacted their cost of production and more of a live budget that morphs into actuals over time.
What I learned is, well, one, building software is harder than it looks if you don't have any experience.
So I taught myself a little bit of coding, quickly realized that for me to become an expert was going to be too hard and too much time, and maybe I just didn't have the patience for it. And so I stumbled upon finding a really good local development shop with one developer who was, you know, great at his job. And him and I really put our nose down for a few months and built the first version of Harvest profit. And that was in 2015, heading into 2016. And then by the end of 2016, launched harvest profit. And a year after that, we, you know, I think we had like 100 customers, and so it was enough, probably 102 hundred customers. So, like, self supporting. And I kind of had to make the decision that I was either going to have to go down the route of working on the software or working on the consulting. And it was just really fun to be able to build something, you know, build something with your brain. And so what our real mission at harvest profit is we want to give farmers better visibility into their crop year based financials, both forward looking and backward looking, and allow them to make more confident, proactive decisions. When I was doing consulting, the farms that were comfortable making proactive decisions, whether it's, geez, fertilizers, maybe it's the summer before the growing season and the fertilizer market dips, but there's still some weather premium in the market.
There's a number of farms that I worked with that would, you know, they'd lock in their fertilizer and they'd, you know, hedge 30% of their crop and they'd do it all in one day. And other operations, you would talk about that strategy and it was, they just had no confidence to do that.
I would say paralyze is a strong word, but I found it really difficult to make proactive decisions with all the uncertainty that's inherent to a farm. So really wanted to, we want to aim, arm our customers to have the financial visibility that they can be comfortable making proactive decisions during the times of the year when they're presented with good margin.
[00:40:34] Speaker A: Well, I think frozen might be a word that I would use there like that. You said confidence as well, that confidence in knowing your numbers, knowing what the plan is. But then when you don't know that, you could be a little bit frozen on what to do it. You might think that one side of that's a good decision, I should buy my fertilizer now. These are the reasons why. But how does the other side look? So I think growers, I don't know if this is the same in the US, but I think they've lost some confidence with how the markets have performed here the last year and a bit in this downward trend. And we're trying to build that back up. And that's where my opinion, harvest profit can help you get that done, get that confidence up. So great. Appreciate you giving us some of that background and some of your story there.
How has the business evolved? You kick this off in, you said late 2016.
How has it evolved here into 2024? What are the differences that stand out for you?
[00:41:34] Speaker B: We've kept a pretty small and lean team at Harvest profit.
We were acquired by John Deere in November of 2020, and we had some aspirations to try to remove as much as we can, to try to remove siloed data and to become more closely integrated with the central source of a lot of data that we were using, which was agronomic data. So seed, fertilizer and chemical.
So we had numerous conversations with the different players that were involved in that space and started really seeing the traction that John Deere was getting with operations center and how they were. The mobile app was changing really quick, and farmers were really gravitating towards what appeared to be a quickly improving product. And then our conversations that we had with people on the John Deere team were, I would say, like, much more deeper and intentional about, like, how do we, you know, if we bring in fertilizer usage from operation center, how do we match that to the product and harvest profit? Just a lot of thoughtful commentary on how we, you know, how we were working together. And then, you know, one thing led to the other, and offering financial tools to John Deere's customers were, was a common request from operation center users. I like to think of farm data as a three legged stool. You have operational data, agronomic data, and financial data management.
Without one of those legs is a pretty wobbly stool. And so we could help bring that functionality to John Deere customers.
Lots of people in the industry that you raise money and you get acquired. And the one thing that John Deere and its dealers wanted to emphasize, we want a tool that can be here for our customers and be around and be available for the long term. That was the opportunity that they saw in harvest profit.
As far as the product we added, the first version of harvest profit was really centered around this p and l statement, crop level, field level, and all the tentacles that touch that. We added grain inventory tracking probably four or five years ago now, and we've just continued to improve on that. Last year we released profit maps. So we have enterprise crop level, field level, and now subfield level profit maps.
And then we're working on a few other things regarding looking at the financial statistics around the equipment side of the operation. So building some calculators around the equipment side, but really just trying to keep a modern UI, there's wrinkles in the user experience, like trying to flatten out those wrinkles.
The product as it sits today, it really doesn't have any glaring feature gaps. We used to handle multiple entities in a really clunky way. We fixed that.
There's always going to be opportunities for improvement. But I would say having a solid foundation with being a wholly owned subsidiary of Deere, combined with getting access to all the APIs that we need, some that are public, some that are internal APIs, is a huge advantage for us. And then just continuing to make small but impactful improvements to the software to make it as easy as possible to use.
[00:45:23] Speaker A: The relationship with John Deere Operations center for us was big to set up our crop plan to import that data, honestly, like nothing's ever perfect. But it was smooth. And when John Deere Operations center was, when everything was, was good in there, like for example, my brother kind of takes care, takes care of that side, and I set up our crop plant in harvest profit in like it felt like seconds and it was just really smooth. I had another farmer I was chatting with, his operation center was just needed a little bit of help, a little bit of tweaking to get caught up. Once that was done, smooth sailing to get harvest profit set up as well. So yeah, I gotta say that's one of my, has been one of my favorite things so far. You mentioned profit maps real quick, what are we talking about there? For profit maps.
[00:46:18] Speaker B: So we bring in seed fertilizer chemical, the as applied maps. Then we take the yield map, and we create a standard pixel size that pierces through all of those layers and calculates what the gross profit is and what the net profit is on those using those standard pixels. It looks a little bit different than what a yield map would look like, just because we have to. The header width isn't matching, the sprayer width, isn't matching the plant or the drill width. So we have to create the standard pixel size. And in all reality, there's a lot of correlation with the yield map, given that yield is the driving factor in that profit calculation.
But you can do some interesting pieces of analysis. Like, if you have different tests on your farm, you can use a profit map to quantify that. It helps show if you have a field that needs some drainage work, but it's something that you rent and you don't own, you can quantify, you can help sit down with a landlord and say, look at the profit potential that we're missing out on this salty third of our farm that is consistently wet. Compare it to the profitability on a field that's maybe tiled or has better drainage or the same thing for irrigation.
You can start to quantify those subfield decisions and add a financial lens to what is typically just an aggregate.
Obviously, there's lots and lots of focus on improving yields and minimizing expenses, but bringing that all together into a profit view is something that we've worked hard at doing. It's a much more computationally heavy process than what harvest profit in its initial state was. We've spent a lot of time just setting up the infrastructure to handle all that data coming in and process it in a timely fashion.
[00:48:32] Speaker A: Okay, cool. Excellent. Appreciate that.
Let's just talk about the platform itself now for a few minutes, if that's all right. I've got a whole bunch of notes here, and I might get a little bit scattered at times. But when it comes to the platform itself as a typical grower, what do you view as the time commitment required from that farmer to get set up? How do you guys look at it from your end?
[00:48:58] Speaker B: A goal that I've had is if you spend an hour or two in the winter, you can get a pretty thorough, detailed crop budget set up. And then the goal that I've shot for is a cup of coffee once a month to. To update your records and have a budget that is continuing to move along and reflect what is actually happening.
As we're ingesting more data from operations center and more agronomic data on that side of our p and l.
For some farms that have a lot of fields, it's maybe a couple cups of coffee and maybe a cup of coffee and a beverage in the evening. But we're trying hard to make the process as seamless as possible, but yet not turn it into a new job. And that's probably the biggest challenge that we have, is we get lots of amazing feature requests, but we constantly are walking this tightrope of giving our customers everything they want, but not turning it into this complex beast of a software that somebody will go in it the first time and. And just be completely overwhelmed with it. So that's probably. I'd say the biggest challenge is because we can do most anything, but you have to. You have to say no to a lot to keep it from just ballooning into this complicated. If you ever use tools like a Photoshop, I mean, even excel, like, just so many features that given that we focus on a. A niche that we can say no to, you know, unfortunately, the reality is we have to say no to keep the ship sailing and keep us from turning in.
We're maybe not a jet ski anymore, but we're still kind of a speedboat. And to keep the product from being this giant ship that's just so hard to turn and so hard to navigate is what we're really focused on doing right now.
[00:51:02] Speaker A: Yeah, that's definitely that tightrope walk or that fine line. And I know when I get into a platform that is massive, you know, you get a little bit frustrated and you say, well, I'm going to come back to this another time. And sometimes it takes you a while to go back to it because it was frustrating.
[00:51:19] Speaker B: Yes, exactly.
[00:51:21] Speaker A: Yeah. Harvest profit.
I know I found it user friendly on my side, but my favorite thing about harvest profit, if I may add this in here, is, I was going to say that was easy to use, but I'm not going to say that because everyone has a different level of experience and it's different for everyone but your support team. When I have a question, a strange question, something weird, you know, it's Ben or it's been Jared or whoever, like, gets back to me very quickly. We can jump on a call real quick if we have to. I don't know if that's the norm that you set over there, but it's the support team, so that it doesn't just sit there for weeks on end. If I'm. If I'm caught or. I have a question. Your team has been very quick to help me out and get me going in the right direction. So that's my favorite part.
[00:52:14] Speaker B: Yeah. Well, thanks for that feedback. You are. Tech is maybe a little different than some of the tool. Well, then a lot of the, I would say, like traditional precision ag tools. And that we, it's just not completely objective.
There's some subjective analysis. Like, people have different situations on their farm. They might have, there's parents and siblings, and you farm some things together, and then you have some different relationships with landlords. And so understanding those, just how the farm works is something that, it's somewhat of a challenge because we know sometimes there's maybe little tricks or how to set things up. And so we handle all the support at harvest profit and we tell dealers, we would love for deer dealers to be fully up and running and be complete subject matter experts on harvest profit, but there's a lot of nuances to a farm and a lot of unique situations. And so we say, hey, you know, we'll take it all on. You know, we have a, we have a couple of our team members that are, you know, watching support, but not only just helping explain what the software is, but, you know, also kind of understanding how the farm functions so we can help people set up the real world situations they encounter.
[00:53:41] Speaker A: Right. Yeah.
[00:53:42] Speaker B: What's your, what's your least favorite harvest profit feature? Something that's an area of improvement.
[00:53:47] Speaker A: I'm going to nitpick a little bit here because I've been involved in crop marketing consulting and advisory for a long time. It's going to sound a little bit nitpicky, but we have different grades and protein levels that we contract or spring weed at. And there's times more often than not actually, where we are doing different. We might do a number, 213 or 13 five. Or, you know, a grain elevator will come out with some special. On some low protein offering, which actually happened the other day. We have a bunch of weak contracts, but within those week contracts, they have different specifications. So there's a comment section in there. But if I could label those in more detail would be great.
[00:54:32] Speaker B: That's. Yeah, that is great feedback. Chew on that a little more. Because we, you know, we've had to set up some unique stuff around grain marketing in regards a situation would be a farmer wants to look, they want to view their irrigated corn and non irrigated corn as two separate crop enterprises.
And when we first had harvest profit, okay, you could do that. Then you have to contract them separately. Well, that's not how it works. You contract it all as corn. So we've built some logic to be able to have different custom crops, market them together.
But then the reverse of that is having the one crop, but then marketing it in different channels. Like, you see with canadian spring weight is. Yeah, that's good feedback.
[00:55:21] Speaker A: I noticed the crops that you have listed, though, like there's just every. I was scrolling through the list like, there's a lot of crops out there that I didn't recognize. So you got a lot of list.
[00:55:33] Speaker B: Yeah, we've tried to. You can add custom crops, too. So if you. Anybody can add a custom crop. We have some people. I mean, there's been, there's been watermelons, there's been cattle, there's been all sorts of fun crops that have been added to our crop list over the years. So one thing that I, a pretty big point of pride for me is there are very few breaking edge cases. We can handle lots of different custom situations now that, you know, three or four or five years ago, that wasn't the case.
[00:56:07] Speaker A: Yeah, fair enough. Yeah. That. I got a few guys that will definitely look at adding a cattle crop in there for sure, but that's cool. I was going to ask you, do you, do you have currently with harvest profit, do you have a, like a pain point? Something that drives you bananas on the platform or anything that kind of sticks out that you're, that's on your mind?
[00:56:29] Speaker B: So when we import data from operations center, it goes into a, it goes into a queue.
Just because we've, we don't auto import it into your p and l. You have to, you know, accept the as applied data into the p and l. And, you know, for farms with a lot of fields, you know, you have to do it on. It's done on a field by field basis. We've tried to make the user experience as quick as possible, but as we've been looking at that recently, there's some wrinkles there that could likely be improved. And we've done a good job of having bulk actions sprinkled throughout the software. So, like your crop plan, you could click on 15 fields and then you set the crops. You don't have to do it 15 times. Or you can create an agronomic template. So you say, this is my spring wheat template, my canola template. You can just automatically apply that to all your crops instead of having to do it over. There's an opportunity, and we've thought a lot about it, and it's not an obvious to do yet, but there's an opportunity for us to make the importing of field operations easier and more seamless. So that's really the, I would say, top of mind for me at the moment. And then in addition, is just this overall bigger picture. So that's a pretty micro issue. A macro issue would be how can we start to give some insight back into the UI of operations center. So do it in a way that doesn't get overly complex because, you know, working across teams and across, you know, APIs and multiple orgs, so there's a lot of irons to wrinkle out there. But I would say, I would say a macro opportunity or a point of frustration to me has been just, you know, there's an opportunity for us to do more by pushing back into op center. And the vision is there, but, you know, it's, it's a, there's a few more dots on that map that you gotta, you know, you gotta connect those dots versus, you know, adding something solely in our interface.
[00:58:48] Speaker A: Yeah, definitely, definitely. That's something that I'm always thinking about is how could that look in the future? If we look and try to picture five or ten years down the road, how could that look pushing back into operation center? So, yeah, awesome. So one of the features that I used this year, more than in the past, of course, we had a big bull market run in 21 and 22, market drops off in 23. But land rental values, those contracts are coming up for some farms every year, there's contracts coming up. So land rental values across the prairies skyrockets here over the winter. And as a landowner, you know, I understand prices improved a whole bunch, margins improved a whole bunch. But in reality, some of the higher price expectations or rental expectations, they were just, wasn't really jiving with the economics. So I was looking separating out your landlords, those entities, and showing the numbers just based on that entity, if we agree to this deal. These are the numbers that I'm looking at. And in many of these cases, they were negative margin numbers by quite a bit. And it really brought around that conversation about, okay, let's get together and try to make a plan on how this could look moving forward. This is how it looks for us for 2024. Maybe there's somewhere a meet in the middle situation. And I found that really, really helpful.
[01:00:23] Speaker B: Yeah, that's, I would say, land decisions. And I, in conversation with landowners is definitely a core use case of harvest profit.
In our P and L Tab, we have this sub tab for analysis. And so what this, basically, it's like x versus y type of analysis. So you can view your total farm in column a, and then you can pick apart certain things to show in column b. So you could do something like a crop budget for your whole farm in column a, and then you could pick the p and l of a specific landlord in column b, and you can start to show those comparisons. And you can also.
You can go and archive a field and, like, do a hypothetical for, what if I just remove this farm or this field from my operation? Like, how does the bottom. Like, what does the bottom line look like? And so I would say, for the most part, our average grower is looking at opportunity, like, looking at growth opportunities. But there's been some pretty powerful stories of customers that they maybe farm in a big, huge geographic spread, and they've kind of come to a point in their farm where maybe we let that north field go. That's long ways away, and the south farm go. And what if we bring things closer to home? We can store more of the crop. We can. Maybe it's a little bit easier on labor. And so doing that scenario analysis is a core use case of harvest profit. We have some farms that have done tons and tons of different scenarios on adding land, letting land go, you know, looking at going from, you know, many combines to you many to fewer x nine combines, and what would the labor look like? And analyzing those different scenarios is something that harvest profit shines at.
[01:02:35] Speaker A: Again, land is a very emotional thing, right? It's very emotional.
And so you're taking away some of that. Bye. Putting down the numbers. I know I bug my dad all the time about his hobbies, and I'm like, okay, dad, so just so you know, like, on this quarter of land, you're losing x amount of dollars an acre, and it's been happening the last number of years. I'm like, you really have to love your hobbies. Like, what are you talking about a hobby? I'm like, well, wouldn't fishing or golfing be cheaper? Like, it's got to be a hobby if you're losing money going across it, right?
[01:03:07] Speaker B: Yeah, yeah.
[01:03:09] Speaker A: Anyway, all right, so we're just about out of time here. Appreciate you coming on the what? The futures podcast. Is there any. Just two quick ones. Is there anything, any differences you see between your us farmers on the platform and your canadian farmers? Are the conversations the same?
[01:03:28] Speaker B: Yeah, I would say the conversations are very similar. Like you said, there are. We do run into instances where you have the multiple grades of crops, or, you know, sometimes you. You sell crops in a different increment than in a different unit size than what you might, you know, quote unquote farm them. And so some of those conversations. But for the most part, it's, you know, I would say that the farms in Canada, just the nature of the market is they're, you know, a little bit bigger. You might have multiple stakeholders that are working in a farm wherever. You know, we work with farms that are anywhere from 100 acres to, you know, big, really big. Tens of thousands of acres, if not more.
[01:04:13] Speaker A: Yeah.
[01:04:13] Speaker B: And the canadian farms, it's more. You might have somebody in the office that's doing it versus your. Your average us farm is a little bit smaller, where the farm owner themselves is the one that's driving harvest profit. And so when you. When you have multiple stakeholders working in one account, sometimes we maybe spend a little bit more time training up the staff of a customer when it's a bigger operation. But for the most part, we handle.
Two years ago, maybe we brought in canola futures. There isn't nearly as much canola in the US. And then farmers in Canada price it different in the US per pound candidates per bushel. And so we had to, like, basically.
[01:04:59] Speaker A: Take these clearly labeled speeds and like, yeah, yeah.
[01:05:02] Speaker B: We had to chop the we to basically build our own API to handle it how customers want to see it. So for the most part, I would just say bigger operations that have a bit more complexity around unit sizes. But that's. Yeah, for the most part, I consider, you know, there's a lot of similarity between a, you know, an Iowa corn and soybean farm and a, you know, a canadian small grain and pulse crop farm. Even if there's a lot of annoyance around, like, coming from western North Dakota, you know, you. You would think that spring wheat isn't even a crop when you, you know, pick up a farming magazine. But right outside of that, a lot of similarity.
[01:05:41] Speaker A: Awesome. And just one final one for you. Are you keeping an eye on these grain markets? Do you have some thoughts around corn and soybeans and what's happening over the last couple of days here and into the summer?
[01:05:54] Speaker B: You know, I guess, my, my, yeah, that's a tough question to answer, obviously.
[01:05:59] Speaker A: Yeah.
[01:06:01] Speaker B: One of my biggest observations or pieces of advice is that we, as humans, tend to take what's happened over the last, you know, two weeks or the last few days and extrapolate that out over the next few months or few years, and that's recency bias at work. And so I would. My advice is always expect the unexpected. And just about the time that we have no hope is when we get surprised in 2019, if you would have told a farmer that 202-020-2122 we were going to enter one of the most prosperous eras in farming, you would have got laughed out of a room two years ago if you said 2024 was looking like it was going to be rough. Maybe there's a bit more realism about eventually the good times we'll have a downturn, but at the end of the day, I tend to just expect the unexpected. And typically grain markets will fluctuate around cost of production and take advantage of weather premium when it comes and try not to panic when it's on the other side of the coin. That's a long winded answer to really tell you nothing. But that's my go to answer.
[01:07:21] Speaker A: I was throwing a wild one out there for you. But the way that I'll bring it back here just to end, is that we established very early on, late last year, our cost of production for spring wheat would be $9 a bushel Canadian for this growing season.
We sat and we sat and we sat and waited. And we have done a tremendous amount of selling in this rally because we knew when we got to profitability, we had to take advantage. And again, bringing it back to numbers, I don't know what's going to happen tomorrow. I don't have a crystal ball myself either. I wish I did, but just knowing the numbers and making a plan and yeah, our farm's feeling pretty good about where we're sitting today.
Keep up the good work. Nick, I know that you contribute blog posts. You're, you're on Twitter, you're all over the place doing great things. Keep it up. You're doing some great work. Thanks for joining the podcast here once again. And hey, hopefully we could check in in the near future as well.
[01:08:20] Speaker B: Thank you. Appreciate you having me on.
[01:08:26] Speaker A: All right, great conversation there with Nick. Always learning something as I chat with these folks. Okay, folks, we're just about at the end of the episode. Let's switch gears now. We've got the mailbag sponsored by pioneer Seeds. We're giving away an igloo, three gallon bucket cooler every month. There's one behind me here, and I got them all now. So we got one for May, which went to Jason. We've got one for June, July 1 for August.
This month's winner is going to be Scott Phillips. I actually don't know where Scott Farms, but Scott asked a question about tying fertilizer decisions and crop marketing together for 2025 or for the next year. And so, Scott, appreciate the question, you're the winner for this month. So I'm going to figure out where you farm, dude, and, and get this to you. But a great bucket cooler, I'm going to fill it with a couple of diet Cokes and we're going to get the tunes going on your bluetooth speaker. Now the mailbag was a little quieter this week. I only have one question. That's a great one. But I think growers. Last week, air carts, I got messages from growers, like, about how cool it was to listen to that episode. So I know you guys are equipment nerds out there. And anyway, so this week's question was our protein premiums expected to be higher or lower this fall?
Now this is a great question. Not in the sense that I can tell you what the answer is going to be on this one, but it's giving me an opportunity to let you know that you can convert grain contracts at some of your local line companies. Some of your local grain companies. Okay.
So you're thinking, Ryan, what, what are you talking about? What do you mean?
So let's say you've sold, I don't know. I love $9 wheat, right? So let's say you sold some $9 wheat and you decided to sell it as a 113 five.
You could, with some companies, let's say you catch wind that the protein premium has gone from a penny a 10th above 13 five. Maybe it's 13.5 to 14 five. It's gone from a penny a 10th up to you decide that that is a good value. You could phone the line company and say, hey, convert my contract from a 113 five to a 114 five instead and they will convert that and capture that premium for you. Capture that extra two cent above what you had committed to.
I don't know if everybody knows that or nothing. It's a pretty cool thing. The other thing that you can do, and the companies usually only let you do it once. Right. But let's say you, let's say the discount between a one and a two here is, let's say it's fifteen cents and from a two to a three is another $0.35 or $0.50 from a one to a three. Let's say you catch wind that that discount from a one two three has gone for fifty cents to ten cents because these things, they don't move a bunch. Protein spreads and grade spreads don't move a whole bunch until you're getting into harvest and then they get pretty wild. And we've helped farmers in the past, man, if I gave Brittany a call and we talked about, you know, stuff we did in 17 1819, like advisors out there keep an eye on all this stuff, and all of a sudden, you know, you pull off a 60 bushel wheat crop and you figured out a protein grade play and you made an extra $0.50 like it. It adds up. Those advisors are definitely making their keep on some of these plays. But you could convert that contract. You say, one, two, or three is only a ten cent discount. Turn mine into a three instead, I'll take the ten cent discount.
It's pretty neat, folks, and it's something that we don't have a handle on yet. But we will as we get into August. Now, for protein premiums, I look at us, winter wheat harvest and soft red is currently coming in 1% higher than last year for protein. So you kind of look at what's going on in the US on the winter wheat crop and what's happening with protein. But even though it's higher there, I look at tight supply, like tighter global supply of milling wheat, high protein, milling wheatley, and also the unknown to this canadian crop here.
But I think it has very good potential to be a big crop. It wouldn't surprise me if our protein levels came in a bit shy across the prairies.
It wouldn't surprise me if tight global supply plays a part as well. And maybe there's someone listening that has more scientific research behind this or statistics behind this. But as I sit here today, I wouldn't be surprised to see protein premiums increase this fall. Yet. I think that's a real possibility if you produce a good crop, bigger crop, usually protein comes down a bit. Could see the same thing in the US with all this moisture. We'll see. Time will tell. I'm just leaning towards here in the impossible call at the end of June, that protein premiums, to me, could tick up just a little bit because of a couple of these factors.
So, good question. Again, I wanted to talk about it because I wanted to let you guys know that you can keep track of these spreads and convert your contracts. Not with everybody, but remember, you're the customer. The customer is always right. Flex your muscle out there a little bit. And if the green company you're dealing with doesn't want to dance with you on this one, well, there's others that will. Right? So flex your muscle on that one just a little bit.
Okay. Prices, I'm going to kind of skip that for now. I've been looking at a lot of fuel stuff and a lot of fertilizer. The urea market, nitrogen market is, it's a gong show out there. You've got, well, you kind of had a market at out there, 280 00:46 it kind of balanced out at, is what I would call it. There's outliers from that. But China, it sounds like they might restrict exports again. Even Josh Linville with Stonex, you know, they're listening to him. There's a few things going on that folks are trying to figure out here on price direction.
Yeah, it's kind of weird out there right now. When things are a little bit weird, I tend to just sit back. Okay. And, yeah, that might be different than what I said the last couple of weeks, but I'm just trying to figure where this is going right now and doing more research. Okay. All right. For eating your veggies, of course. This is brought to you by the lunchbox crew. If you want your meat and potatoes, come join us at the lunchbox crew this fall. You can head over to Ryan, Denis, CA and check that out.
Okay. I just one thing on the lunchbox crew. Can you imagine starting a consulting offering out there on June 1 in a year where the market is going to decline every single day after you launch?
So if you can imagine, this is me in video one. I'm going to play some of these in the future, these clips. But in video one, it's June 1. Welcome to the one, welcome to the lunchbox crew. You need to sell some grain. And I know we haven't been formally introduced yet, but thank you for joining. And here you go. I'm like, sell, sell, sell.
Video two, I'm like, we're getting uncomfortable here, folks, but we're selling more. Here we go. It's been like that all month. And just, I don't know if I want to call it, I'm not going to call it bad luck, but an interesting time to launch.
And yeah, I know it's been like, it's been awesome and rewarding for me. And I've seen a lot of farmers make some cool decisions here. Yeah. Even one on the weekend. You guys could contract grain on the weekends now, right? Don't forget that Sunday we were doing some wheat contracts and, geez, from Sunday to Friday, well, I guess it's Wednesday night, but it's already $0.40 in the good. So anyways, folks, it's been really, really interesting over at the lunchbox group, okay. Eating your veggies. My only one for this week is just a reset, okay? It's a mind reset. It's a market marketing plan. Reset.
I need you to look forward and not backwards.
And I had the same message for you. I think it was between Christmas and New Year's and right at the end of 2023, but you have to look forward now.
And don't get caught about what yesterday's price was. Don't get caught about what last month's price was. Don't get caught in that. What is it going to do tomorrow? What is it going to do next week? What is it going to be by the time you need to clear the bin out, generate cash flow, whatever it is you have to cut or reset your mind, your thinking, and even sit down with your crop marketing plan and see what you've done to date, how you've done according to your plan.
And I, we all wish we had a little bit more sold, right. But I, as I sit here and do my reset, the reason I'm resetting is that I've executed the first part of my plan and it fell in line with my expectations.
Okay, I've bought time.
I'm feeling okay. I'm feeling good about the crop marketing plan. To be honest with you. I'm feeling good about it. Now I'm going to sit here and say, okay, July 1 to early August, what is my next phase? What do I plan to execute on over the next four weeks? And those four weeks I'm talking about, you know, what happens with weather, what happens with seasonal patterns for price, what happens to move this market one way or the other?
I'm not panicked to do much of anything right now, but I also realize, or want to realize, that if we see something happen, what's my plan with that? I'm also looking at what do I have for fall movement? What do I have for storage right now? Adjusting yield expectations.
I'm also looking at cash flow and when's my next gap for cash flow and when am I going to fill that in? So anyways, I think a reset's important right now, and I think making your plan moving forward is very important for you. And I hope you take time to do that. I know it's hard to do that in season when you're super busy, but I hope you take time to do that.
In closing, folks, thank you again for hanging in there. This is a long episode. We had Nick on for 45 minutes. I'm doing my usual rants. I know this is probably our longest episode ever. If you've made it this far, thank you. And if you found this episode useful, please share it with a friend, a neighbor, a colleague in your local farming community. Spread the word, my friends, about the what? The Futures podcast. Don't forget, come see me at egg in motion. Get yourself a cool t shirt. Lastly, prices can change.
Like I said, I'm the fool. Recording this before two major reports on a Wednesday night. If you want to be a guest of the show, email me. Head to the website Ryantine cA. If you want to sponsor, that's the spot you go to as well. Thank you so much. Have a good, great weekend.
I'm out.
