The company is building two new product distribution centres.

The warehouse in Brandon is scheduled to open Sept. 1, 2025, while the one in Grand Prairie, Alta., will begin operations on Jan. 1, 2026.

Follow all of our Ag in Motion coverage at the Western Producer.

Those are two big growth markets for FBN. The company had been working with third party warehouses but decided to take more control of product distribution.

“We think that we can grow the business on our own faster and better by doing it ourselves,” FBN general manager Breen Neeser said during an interview at Ag in Motion 2025.

FBN has a big warehouse in Saskatoon, another in Yorkton and one in Langley, B.C. that it is in the process of selling.

The two new distribution centres will stock all FBN’s agricultural product line.

Neeser said the expansion is not related to competitor AgraCity announcing that it was having cash flow problems, but it hasn’t hurt the project.

“We’ve been able to hire a couple of their former salespeople,” he said.

FBN is also in the process of expanding its crop input offerings beyond agricultural chemicals.

The company recently launched six bulk liquid fertilizer products.

FBN had already dipped its “toe in the water” with its Pro Ag fertilizer products, which were distributed through the Langley warehouse.

However, this is a new venture with a Saskatoon company that manufactures fertilizers for pre-seed and post-seed applications.

Neeser said it is way better to be working with a company in the heart of the Prairie region than attempting to do it from a distance.

“The fertilizer business is freight sensitive,” said Neeser.

“You can only go so far on a truck before you market yourself out on cost.”

The company is selling both nitrogen-based and phosphorous-based products.

“They’re all blended fertilizers,” he said.

Nigel Buffone, senior director of crop protection with FBN, said the company has not forgotten about its core business, launching 10 new crop protection products and co-packs for wheat in 2025.

FBN is attempting to provide farmers with the closest thing to pre-mix products by using its manufacturing facilities to package products together in case sizes such as 40, 160 and 320 acres.

Those co-packs are designed to make life easy for growers, eliminating the math.

Buffone said the company is identifying successful herbicides and bringing those products to its members.

“I think in the cereals market, we will have a solution for every acre next year,” he said.

Neeser said the next venture for the company will be livestock products.

“We’ll probably dip our toe in the water this fall and get into some of those,” he said.

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“AgraCity has experienced some cash flow issues and has been in a process to refinance our business,” the firm said in its message to farmers.

“The process has unfortunately taken much longer than expected and has resulted in product availability issues this spring.”

As a result, the firm will be unable to deliver outstanding product to its customers in a timely manner this spring.

“All outstanding product orders are being cancelled and being converted into a product credit,” AgraCity told its customers.

“We want to inform everyone that the sales team worked tirelessly to the best of their ability to meet the needs of their customers and was caught off guard, as we all were, by the delay of the refinancing efforts.”

Orders not delivered

A farmer from the North Battleford, Sask., area, who requested anonymity, told the Western Producer that he prebought $54,000 of glyphosate from AgraCity that was supposed to show up on his farm during the winter months.

It did not.

“I got calling my representative in the spring and there was no chance of any glyphosate showing up,” said the grower.

“They were hoping for new crop chemical, is what I was told.”

He also purchased $27,000 of glufosinate from the company in the fall of 2024 that never arrived, he alleges.

He has given up on receiving any of the herbicide that he ordered and paid for.

The farmer is speaking to a lawyer about what steps he can take.

A scan of the Better Business Bureau website shows this isn’t the first time customers have claimed the company left them high and dry.

An anonymous complainant says they ordered $34,000 of product from AgraCity in April 2022 and then immediately cancelled the order.

“The product was charged to our credit card and has yet to be reimbursed,” the person stated in the complaint.

AgraCity responded to the complaint, saying that it was in the process of issuing a full refund.

The complaint status is listed as “unresolved” by the bureau.

‘Portfolio of lawsuits’

AgraCity is owned by James Mann and Jason Mann, who are listed as equal shareholders in the company, according to court documents.

The two brothers are directors and officers of AgraCity, with Jason responsible for the day-to-day management of the firm.

James is also the sole registered shareholder of Farmers of North America, although Jason claims to have an ownership stake in that firm.

The two companies are intertwined because AgraCity sells agricultural crop inputs but historically has done so only to farmers who are members of FNA.

The Court of Appeal for Saskatchewan says the two brothers and their companies have been embroiled in a “portfolio of lawsuits” against one another dating back to 2017.

“Most parts of this litigation have yet to reach a conclusion, whether through trial or otherwise,” the court stated in a March 5, 2024, decision.

Stopped deliveries news to Mann

In a statement released June 8, James Mann said he learned on June 6 that AgraCity had stopped delivering prepaid product to producers.

“By court order, I have not been in charge of AgraCity since 2017. Since that time I have been concerned about various issues with the management of AgraCity and have been fighting these issues in court,” he said in the statement.

“In April of last year, I brought an application to have a neutral third party manage or inspect AgraCity’s finances. This application was heard on March 13 of this year, and we are still waiting for the court’s decision.

“I want to assure our members that Farmers of North America will do everything in its power to protect and help them.”

Awan Khurrum, a Regina lawyer who has represented AgraCity, said the litigation between the Mann brothers remains before the courts.

He is not aware of any receivership or creditor protection proceedings against AgraCity.

AgraCity has been operating for 20 years and claims to have saved farmers millions of dollars a year on their crop input bills.

Jason is also the president of Genesis Fertilizers, a company that is proposing to build a nitrogen fertilizer production and distribution plant in Belle Plaine, Sask.

—Updated June 9 to include comments from James Mann.

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Darwin Sobkow was announced Jan. 6 as the company’s new chief executive officer, effective Jan. 10 with the formal retirement of Curt Vossen, the company’s CEO since 1995.

Sobkow served as chief operations officer since 2020 for the Winnipeg-based, privately-held firm, an arm of family-owned James Richardson & Sons.

The company’s ag industry holdings include a network of 55 Prairie grain elevators; port terminals in B.C., Ontario and Quebec; canola crush plants at Lethbridge and Yorkton; oat milling facilities in the three Prairie provinces and one each in the U.S. and U.K.; several further-processing plants; and 93 Prairie ag retail outlets supplying seed and crop inputs to farmers in the region.

During a nearly 30-year stint as CEO, Vossen oversaw much of that expansion, including the acquisition of more grain elevators, mainly during other Prairie grain handlers’ mergers and divestitures—as well as acquisitions such as U.S. durum miller Italgrani USA and the U.S.-based Wesson cooking oil brand.

“Under his leadership and bold vision, Richardson International evolved into a world-class organization with expertise across its vertically integrated agribusiness and food processing operations,” the company said in its Jan. 6 announcement.

Richardson noted Sobkow, who started with Richardson in 1999 as executive vice-president for agribusiness operations and processing, was “instrumental” in those acquisitions and integrations.

His “operational expertise and deep industry knowledge will guide Richardson International into its next phase of growth,” the company said.

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The poll of 858 producers from coast to coast determined that farmers rank climate change as their No. 1 concern.

“When farmers and ranchers were asked an open-ended question—at the very beginning of the poll—about the top challenge for the agricultural sector for the next decade, climate change was the number one answer,” says Farmers for Climate Solutions, a group, that as its name suggests, is focused on climate change mitigation and adaptation within Canadian agriculture.

The organization hired Leger, a market research firm, to conduct the survey.

It was done by phone from Aug. 8 to Sept. 8.

The headline question from the poll asked farmers to identify the top challenge for the agriculture sector over the next 10 years.

The results?

• 17.9 percent said climate change.
• Input costs were 17.2 percent.
• Government policy and regulations, 11.5 percent.
• Market uncertainty/price volatility, 9.8 percent.
• About 5.8 percent of respondents ranked severe weather as their No. 1 challenge over the next decade.

Brent Preston, president of Farmers for Climate Solutions, said the poll result was unexpected.

“I was surprised that climate change was right at the top. I thought it would be a concern for most producers, but I didn’t think it would be the number one concern,” said Preston, a vegetable grower from Creemore, Ont.

Farmers for Climate Solution decided to pay for a poll because it wanted information on how farmers feel about climate change and related issues.

He said it’s important to have this sort of data when meeting with federal and provincial officials.

“We’re hoping it will give us ammunition when we talk to politicians and policy makers,” he said.

“We can now say, ‘look, this is an issue that’s top of mind for producers and we’re hoping governments are going to do more to help up adapt.’ ”

East-west split

The poll suggests that Canadian farmers are anxious about climate change, but the details within the 37-page report tell a more nuanced story.

Eastern farmers are concerned about the climate, while western producers are less so:

• 116 farmers out of 450 respondents (26 per cent) from the East ranked climate change as the biggest challenge over the next decade.
• In the West, 38 of 408 respondents (9.3 per cent) said climate change was the biggest challenge.
• Nearly three times more farmers in Quebec, Ontario and the Maritimes are worried about climate change.

The gap between East and West is striking, Preston acknowledged.

“There’s a very clear difference in perception or attitude,” he said, adding that farmers across Canada have some concerns about climate change.

“Everywhere in the country, climate change is in the top three.”

In its report, Farmers for Climate Solutions noted that Prairie farmers are less concerned about the issue.

“Input costs and government policies are seen as the top challenges (in the West).”

In more detail, 21 per cent of western farmers said input costs are their top challenge. About 16 per cent said government policy and regulations. Around 12 per cent cited market uncertainty and nine per cent said climate change.

The poll received responses from 858 people across Canada, including 247 farmers from Quebec. That’s nearly 29 per cent of the total for a province that has five per cent of the country’s arable land.

Comparing the total number of poll respondents, 450 out of 858 were from Ontario, Quebec and the Maritimes. The remainder, 408, were from the West.

A critical piece of data that could be missing from the poll is the opinions of large-scale farmers.

Of all the producers who responded, about 50 percent said they have farm revenues of zero to $500,000. Only 7.6 per cent in the survey had revenues of $3 million or higher.

More large producers are likely needed in the survey to paint an accurate picture.

“You might be right. We may have over-represented small farmers,” Preston said, adding it was difficult for Leger to acquire lists and contact information of producers.

“The sample is definitely not perfect…. We’re not going to use these results to say that definitively, X percentage of farmers think (this or that) … but we think the sample is good enough to make some broad inferences.”

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“Lower farm revenue this year and next will reduce the demand for crop inputs,” wrote Leigh Anderson, senior economist with FCC, in analysis posted Aug. 28.

Record U.S. corn and soy yields are pushing commodity prices down. If Canadian farmers have average yields, lower prices could result in negative net returns for some farms, Anderson wrote.

Portions of the Prairies struggled with hot, dry weather this summer. Between July 29 and Aug. 11, more Prairie farms made more than 1,600 hail claims, with the heaviest damage in Alberta, the Canadian Crop Hail Association reported.

Chemical prices have eased, Anderson said. Prices of key active ingredients have fallen, and inventories of chemicals like glyphosate have increased. Agricultural chemical sales are expected to decline by 14 per cent in 2024 and another four per cent in 2025 due to lower prices.

Fertilizer prices have declined throughout 2024. Demand, particularly for nitrogen, has been lower globally. Prices could rise before next year’s crop, Anderson said. China’s export restrictions, paused production in Egypt, and other issues are keeping prices high.

However, “if global crop prices keep falling, it could lead to even lower fertilizer prices,” Anderson wrote.

Demand for domestic fertilizer is a concern. The amount of land used for specific crop affects demand, and fertilizer use also changes on profitability, moisture and soil nutrients. Recent profitability and moisture levels could result in farmers using less fertilizer.

“Soil testing and planning crop inputs are just as important as marketing plans for profitability,” said Anderson.

FCC predicted farmers will spend 3.6 per cent less on fuel next year, though prices tend to rise and fall on global market conditions.

Commercial seed sales are expected to rise five per cent because of higher prices for hybrid seeds like canola, soybeans and corn. Prices for pedigreed seed should be stable.

The post Pressure on farm income could push input prices down says FCC economist appeared first on Country Guide.

Logistics, opportunity costs and strategy

Logistics also come into play. The ideal agronomic plan won’t be executed if cash flow, labour, machinery and technology aren’t available. Execution needs to happen in a tight window. Precision agronomy and farm expansion sometimes clash for this reason.

Is your farm’s strategy to increase economies of scale or to increase margins on existing acres?

And, is bigger better? Chick-fil-A founder Truett Cathy and his board were wrestling with new competition that had big expansion plans. In response, he is quoted as saying, “if we get better, our customers will demand that we get bigger.” Similarly, in farming if you get better, your balance sheet and stakeholders would demand that you get bigger.

Opportunity costs are part of the planning phase of building crop budgets. A cropping option will prevent you planting something else. Another may be eliminated due to constraints such as acres and rotation, or people and machinery. Gross margin analysis is the best way to evaluate different cropping options.

Gross margin analysis

The costs that can be accurately and efficiently assigned to specific cost centres (crops) should be included in the gross margin analysis. Typically, this means seed, fertilizer, chemical and crop insurance. Other variable costs exist on the farm but aren’t usually included. Variable costs are costs that change with acres farmed. Machinery and labour costs are examples. The problem is they’re not easily assignable to a specific crop. For labour, time sheets would need to be used; for equipment, engine hours, yet many crops see similar amounts of machinery and labour used. Few farmers see enough value for the time it takes to assign other costs such as machinery and labour to cost centres. Budget-to-actuals are helpful for all farm expenses, but farms should start with a budget-to-actual at the gross margin level.

Budget-to-actual

Producers should be preparing a budget-to-actual on inputs but in many cases, it’s a challenge just to get the bookkeeping and financial statements done. During your budget-to-actual review, billing or application mistakes could be found. Other benefits include improving the budgeting process for next year. Predicting insecticide and fungicide for the upcoming year is a challenge but a good opportunity to practice your forecasting skills.

A budget-to-actual requires assigning actual input costs to specific crops. Some bookkeeping software allows you to tag expenses to certain crops. This is more practical with a farm owner who knows what inputs were used on what crops, while many farms use third-party bookkeepers with limited agronomy knowledge.

Bin-run seed is a common issue. If it isn’t recorded, it will be buried in the grain inventory adjustment and hide your accurate seed expense.

Cash flow

More collaboration between farmers and agronomists on price points and budgets would be helpful, as most don’t have unlimited budgets for crop inputs. Credit lines should be in place early and be able to absorb contingencies like fungicide and insecticides.

Some farms pay all their expenses in cash while others finance their crop 100 per cent. A good benchmark for working capital-to-expenses for your farm is 50 per cent, i.e. you have cash to pay for half of next year’s expenses and need operating credit to finance the remaining. It’s advantageous if the agronomist is up to date on input prices. With deferred payments and zero per cent financing you can put cash to work elsewhere including land, technology and people investments.

Fertilizer is a commodity that should be managed like grain marketing. Sometimes it’s purchased early for tax planning reasons. If nine years out of 10 it’s cheapest in the fall, maybe there’s no issue. However, recently it became the top line item on farm income statements, surpassing machinery expense. It deserves more agronomist and financial management attention.

Crop shares / joint ventures

Crop shares and joint ventures can complicate crop budgets if some inputs are reimbursed in the budget while others are not. Agreements should be in writing to reduce issues. Open-ended agreements may cause issues later with audits requiring accuracy.

Craig Macfie, CPA, CA, PAg is a chartered professional accountant who specializes in providing fractional CFO services to growing farms. He can be reached at craig.macfie@springcfo.com

– This article was originally published in the February 27, 2024 issue of Country Guide.

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“We wanted to create a way to promote our proprietary products that was different and fun for our customers,” said Derek Flad, agronomic innovation manager for the Southern Alberta Division of Nutrien Ag Solutions, in a release.

Flad is co-leading Nutrien Ag Solution’s Hometown Yield Challenge with Shelby LaRose, Crop Nutrition Product Manager for Canada.

Nutrien launched the program on February 2, and they are inviting farmers across western Canada to enroll in the challenge. The submission deadline is Friday, March 1.

The challenge will run until November 2024, when harvest totals will be tallied and the two top-yielding growers will be awarded $20,000 to go to a local organization of their choice. The three second-place winners will each be awarded $5,000 to go to a local organization of their choice.

“Competition always gets people fired up, but creating a benefit for the communities that our growers live and work in will not only engage our growers but their neighbours as well,” said Flad.

Growers participating in the challenge will have to seed at least 80 acres and will be required to use a number of proprietary Nutrien products, the details of which can be found on Nutrien’s Hometown Yield Challenge web page.

In a media release, Jesse Hamonic, Nutrien Canada’s vice president and country lead, said programs like this, which put a focus on community, are an important component of the work they do.

“While Nutrien Ag Solutions is a large, global company, we really pride ourselves on our focus and commitment to connecting with the communities where our employees and customers live and work,” said Hamonic.

For those interested in following along, farmers will be invited to post photos throughout the challenge with the hashtag #NutrienHometownPride.

—Don Norman writes for the Manitoba Co-operator from Winnipeg.

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The Indianapolis-based company also forecast higher net sales in 2024, falling in the range of $17.4 billion to $17.7 billion, banking on demand for grain, oilseeds and biofuels.

Though global crop prices have fallen from last year, they remained elevated compared to historical averages, leading to farmers harvesting more to cash in on elevated crop prices.

Corteva, spun off in 2019 after a merger of Dow Chemical and Dupont, reported net sales of $17.23 billion in 2023, staying in the $17-$17.3 billion range that the company had forecasted.

Net sales were at $3.71 billion for the quarter ended Dec. 31, compared with estimates of $3.62 billion, as per LSEG data.

Sales from seed business were $1.64 billion, down 0.6 per cent due to lower volumes, with farmers delaying purchases due to unfavorable weather in Brazil.

However, this was offset by higher seed prices led by North American and European markets, and increased corn acres in North America.

For the crop protection segment, Corteva’s reported net sales were nearly 5 per cent lower on both falling volumes and prices especially in Latin America, and channel inventory destocking.

Brazil’s drought caused farmers to delay fertilizer purchases for their corn-planting season, denting sales for global fertilizer suppliers including Corteva, which had to sell its Brazilian stock at a discount due to tepid demand.

In 2024, crop markets may face tighter supplies due to adverse El Nino-related weather effects, export restrictions and higher biofuel mandates, analysts said.

Shares of Corteva were down 0.8 per cent after the market closed yesterday.

The operating core profit was 15 cents per share, compared with average analysts’ estimate of 6 cents.

–Reporting for Reuters by Seher Dareen in Bengaluru.

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Potash prices have been falling after shipments from Belarus and Russia resumed. These exports had been significantly restricted last year following Western sanctions imposed on Russia in response to its invasion of Ukraine.

Demand for fertilizers was also weak during much of the year, analysts have said, as farmers waited for prices to settle down.

Potash prices averaged $250 per tonne during the reported quarter, the company said, compared with $633 per tonne a year earlier (all figures US$).

The company’s U.S.-listed shares fell three per cent after the bell.

Nutrien said potash sales volumes, however, climbed 23 per cent on strong sales in North America.

Fertilizer inventories in the U.S. had been running low which should result in relatively robust demand, BofA Global Research analyst Steve Byrne had said ahead of the earnings.

On an adjusted basis, Nutrien reported earnings of 35 cents per share for the three months ended Sept. 30, compared with the average analyst estimate of 64 cents, according to LSEG data.

Nutrien, the top U.S. agricultural retailer, also narrowed its adjusted earnings forecast for 2023 to a range of $4.15 to $5 per share, compared with a range of $3.85 and $5.60 earlier.

The company forecast fourth-quarter fertilizer demand would be up five to 10 per cent year-on-year.

Nutrien added it was lowering its nitrogen sales volume forecast due to the unplanned outages in the third quarter and pull-forward of a planned maintenance outage at its Borger site in the current quarter.

— Reporting for Reuters by Sourasis Bose in Bangalore.

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Samuel Taylor, a New York City-based farm inputs analyst for RaboResearch Food and AgriBusiness, delivered a presentation on the fertilizer market during the firm’s Fall Harvest Outlook webinar on Oct. 25.

Taylor presented a fertilizer “affordability index” which is measured using global fertilizer prices against global crop prices with a baseline of zero. Last September, the value was 0.01, down from around 0.25 in July. By comparison, the index had fallen to minus 0.65 in Jan. 2022, its lowest value since the Great Recession of 2008. Despite this, the index, and the worldwide affordability of fertilizers, are expected to improve into July 2024.

Separated by fertilizer type, potash had the best affordability index value at 0.32 (historical average at 0.11) in September, followed by phosphates at 0.07 (average at 0.11) and nitrogen at minus 0.19 (average at minus 0.04). Taylor predicted global nitrogen prices to increase by more than five per cent, while global prices for potash and phosphates will remain virtually unchanged.

RaboResearch Food and AgriBusiness also estimated a three per cent year-by-year increase in global fertilizer usage in 2023 and further projected a five per cent rise in 2024.

“Since (the Russian invasion of Ukraine), we’ve seen a rationalization towards fundamentals. A lot of the price action was built on timing and also capacity of supply and demand,” Taylor explained. “There’s a little bit of clarity there and a little bit more re-establishment of supply chains.”

In North America, Taylor added that year-by-year, prices for ammonia will be down 50 per cent, potash retreating by 44 per cent and phosphates pulling back by more than 10 per cent. In addition, prices for herbicides will be cut 50 per cent, fungicides 40 per cent and insecticides 25 per cent.

“From a cost-structure standpoint, there are some positive elements that you can point to,” he said.

However, Taylor warned the ongoing Israel-Palestine conflict could cause additional issues. In 2021, Israel produced 3.96 million tonnes of potash and 1.07 million tonnes of phosphates — seven and two per cent of global market share, respectively.

“As far as we’re aware, (Israel is) functioning as normal,” Taylor added. “However, within the context of quite a large mobilization, there is the risk in the future that there could be some disruptions to logistics, to manufacturing. But there is nothing to report on (now).”

— Adam Peleshaty reports for MarketsFarm from Stonewall, Man.

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