Building a traditional farm for a modern world

Change Makers: Yesterday’s values can still guide their farm today, Jason and Laura Kehler are discovering, but only if those values are re-engineered for efficiency, and for a new business climate

Today’s farmers are change makers. Re-inventing our farms has become normal.

So Country Guide asked top ag journalists from across the country to interview farmers who excel at change, taking their farms in very different directions with an eye to finding their best opportunities.

Their stories start with our January 2017 issue and will continue through the winter. As you’ll see, our Change Makers are inspiring and insightful, and they are also gritty and determined. They’re young and old, from small and large operations, managing crops and livestock.

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These farmers push the boundaries, find solutions, and change negatives into positives, and they fill us with optimism for the future of agriculture.

Drive on.

Harvey Kehler had a measured way of making sure his son Jason was going to know the family business literally from the ground up.

At just 11-years-old, Jason got assigned to the potato line at Kehler Farms near Carman, Man., working the job that’s perhaps crudely but accurately called “picking dirt.” By 16, he was cultivating and discing, and at 18 he was operating the harvester.

And soon there would be more.

At just 23, Harvey decided Jason needed some skin in the game, and he turned over a 20 per cent share of the business to him. The year was 1998.

“He said you need some ownership,” Jason recalls, “so that’s where I started.”

Harvey seems to have known his son was ready, and Jason responded.

“That same year, I bought a semi-truck and started my own business trucking in the winter time,” Jason says. “I paid the truck off as fast as I could and saved up a bunch of money to put back into the farm.”

But one lesson of farming is that everything doesn’t always fit neatly with our plans.

Jason is a fourth-generation farmer, but only the second at the current farm, which Harvey and his brother Rob had purchased in the 1960s. (His grandfather’s original homestead was about 70 kilometres south, near the U.S. border at Rosetown, Man.)

Harvey and Rob had farmed together all along, but with little warning, at just the same time that Jason was getting his first taste of management, Rob decided it was time to pull out. “Rob’s abrupt departure from the farm was a real shock to us,” says Jason. “I had to grow up quick.”

“It was awkward being a young guy, trying to manage people who were older than me,” Jason says. “Looking back on it now, I realize how many years it’s taken me to get comfortable in my role.”

He wonders now if he was actually ready, but he also knows he wasn’t in a position to back away from the challenge, even if it was in his character (which it isn’t), especially one that was going to teach him to embrace change instead of fighting it.

In fact, it’s a trait that has helped keep up the growth of the 5,600-acre farm he now runs with wife Laura.

“Our philosophy is to always have an open mind about whatever comes down the pipe,” Jason says. “If you don’t embrace change, you’re not going ahead, you’re going backwards.”

Bigger, and just as good

Following Jason’s stepping into full management, the farm has expanded rapidly. Since 2013, they have increased total crop acres by 48 per cent, including a doubling of their processing potato acres. They’ve also purchased three quarters of land, and installed four quarters of drainage tile.

“I recognized that to maintain a spot in the potato business, we were too small,” says Jason. “We weren’t generating the revenue we needed to spend enough money on the business.

“My dad was always a precise farmer more than a volume farmer. It was important to him to have everything perfect. I think we’ve done a good job of maintaining those values as we have grown.”

We still want to be cutting edge… but I also want to be responsible, and start to pay down debt and set the farm up for the kids.” — Jason Kehler.

We still want to be cutting edge… but I also want to be responsible, and start to pay down debt and set the farm up for the kids.” — Jason Kehler.
photo: Sandy Black

Jason took advantage of the opportunity to purchase some equipment, storage, land and potato contracts from a local producer who was exiting the industry, expanding his potato production from three irrigation circles to five.

Again though, he had to be ready for change when the opportunity demanded it, rather than exactly according to plan. The following year, in 2014, another potato farm came up for sale. “You can’t always let these opportunities pass you by, so we decided to take it on,” says Jason, who secured contracts for the new production.

Jason and Laura admit they had a few sleepless nights as the business rapidly expanded and cash flow became tight, but took comfort in the support and backing of their banker and accountant.

“With such a rapid expansion, the numbers didn’t always look good but they had faith in us,” says Jason. “They knew we could do it and told us that. We needed that encouragement at times.”

Jason also gives credit to his father, who was a more conservative manager and had left the farm in a good position for Jason and Laura to take over and expand. “Our debt-to-equity ratio was good when we took all this on,” says Jason. “That was largely a result of Dad’s management over many years.”

His father also had the benefit that comes from time and perspective, and he remembers his father telling him something he’ll never forget. “He said, ‘It’s pretty cool to buy a combine when you’re 20, but once you’re my age, you’ll realize that you have to pay for it.’”

“I’m 40 now and he’s right, the romance of buying machinery is gone.”

Focus on sustainability

Originally from Ohio, Laura comes from a multi-generation farm family. She has a masters degree in food science from Oklahoma State, and worked for Tyson Foods and Nestlé before meeting Jason in 2007 and moving to Manitoba the following year.

Laura left her job as a food scientist at the Food Development Centre in Portage la Prairie to work full time on the farm after their second son was born.

Laura’s background in food science has come in handy, as the potato industry is subject to multiple workplace and food safety programs. These include the HACCP-based food safety program CanadaGAP, plus regulations governing chemical management, pest control, the Environment Farm Plan, the Potato Sustainability Initiative, Manitoba’s Workplace Health and Safety regulations, Workers Compensation, and many others.

Increasingly, food companies such as McDonald’s are responding to customer feedback with initiatives that require benchmarks and reporting procedures for potato producers to verify that they are using sustainable production practices.

“Sustainability for me is making my farm better, doing what I can to be efficient, and I want to do it for the betterment of the farm, and the land and the environment; that’s just who I am,” says Jason. “Politically, it helps us with our relationship with the McDonald’s of the world, but that’s not why I do it. For me it’s about being better.”

Workplace health and safety regulations take up a lot of time, as the Kehlers provide training for things like first aid and skid loader operation. They’ve also developed a safety team, plus written policies about everything from smoking in vehicles to working in confined spaces such as grain bins, and they hold quarterly safety meetings with staff.

These changes were costly to implement. “The first year that we initiated the Workplace Safety Program we spent almost $30,000 to implement it,” says Laura. “It doesn’t cost as much to maintain it but there are some ongoing costs, for example fire extinguishers are required in every piece of equipment with a cab — two in each combine — and in every building, and they all have to be tested annually and replaced every few years.”

Not that they disagree with the concept of safety. “It’s definitely made everyone more aware of safety,” says Laura. “As experienced farmers and operators, we may know how to operate equipment safely, but the rules are written in a way that makes you think about the least experienced employee you might have, which is good.”

Mostly, say the Kehlers, all these programs involve a ton of paperwork, but they also help them assess their practices and find new, efficient ways to do things.

Thinking outside the box

The Kehler family has a tradition of thinking outside the box. Jason’s grandfather was one of the first producers in Manitoba to grow sugar beets in the 1940s, followed by sunflowers and then canola.

Jason meanwhile was one of the first producers in his area to adopt variable rate (VR) fertilization, which he now applies to all his crops. “I did it out of a desire to get better,” he says. “We were always having quality issues in our potatoes. In the potato business, quality is by far more important than quantity. If you don’t have consistent quality, you can’t market your crop.”

Since adopting VR fertilization, the Kehlers have achieved more consistent, evenly maturing crops because they are applying different rates of fertilizer based on mapping of the different soil zones in the field. “We’re improving our quality and it comes from striving for a better bottom line, and to do a better job farming, but it’s also environmentally sustainable,” says Jason.

With all the soil testing they do, Jason knows they’re much more efficient in their fertilizer use, getting bigger yields while not increasing their fertilizer costs. “We’re getting a bigger bang for our buck and that’s a huge asset to our farm,” he says.

Next Jason is interested in exploring variable rate irrigation, which comes with a $30,000 to $40,000 price tag for each pivot.

The importance of a marketing plan

Another thing that’s changed is Jason’s mindset on marketing his crop. “We sit down every year and develop a marketing plan. You can’t make a marketing decision based on a one-week period,” he says.

The Kehlers understand that it’s crucial to know their cost of production on all their crops, and determine what their profit margin is, so they can make good marketing decisions. “Don’t get caught up in what you sold for last year. If you know you’re making money with corn at $4.25/bushel, sell some, maybe not all, and don’t worry about it,” says Jason.

Jason and Laura won the title of Manitoba’s 2016 Outstanding Young Farmers (OYF), and headed to Niagara Falls in November for the national finals. It was a surprise to learn it was their accountant who had nominated them. “It made us feel really good that he had the confidence,”says Jason.

OYF has been a great experience, the couple says, particularly because they have met so many other alumni of the program who are progressive farmers and strong advocates of agriculture, something that is important to them both. “I’ll do anything I can to represent agriculture in a positive light, whether it’s hosting a school tour or talking to a group, because it’s something dear to my heart,” says Jason.

“There’s such a small percentage of the world that is involved in agriculture,” says Jason. “For me the biggest thing is to listen to people’s viewpoints. That gives you the opportunity to explain the real facts about our practices.”

Setting up for generation #5

Although necessity catapulted Jason into a management role on the farm at an early age, his dad didn’t find the full transition process so easy.

“He came from a different place. He started with 80 acres and did an amazing job to build the farm up to 2,800 acres, and he had a different set of ideas that he worked with,” Jason says, admitting, “We pushed him pretty hard to finally get a generational plan going.”

When Jason was 30 and itching to take on more, his dad was 57 and was still in full gear. He wasn’t ready to let go. “I hope it will be easier for me because we had kids when I was older than my dad did, so by the time our kids are old enough to start taking over, I’ll be at the point where I’m ready to let go a little more,” he says.


photo: Sandy Black

The Kehlers have two children (Paisley, five, and Wyatt, three), and their goals are already shifting to include this fifth-farming generation.

“Through my 30s, my goal was just expansion, and now that I’m 40, I’m saying to myself this won’t last forever,” says Jason. “We still want to be cutting edge; we still want to be ahead of the curve as far as technology is concerned and growing techniques. But I also want to be responsible, and start to pay down debt and set the farm up for the kids. Up until now, I’ve been setting it up for me. Now it’s not about me anymore; it’s about the next generation.”

This article was originally published as “New again” in the January 2017 issue of Country Guide.

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Angela Lovell

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