Consolidating Specialty Acres Could Present Opportunities for Growth
Corporations like dealing with fewer large growers, rather than many small growers.
Published on: March 10, 2011
If you ever get the chance to hear Texas A&M’s Danny Klinefelter speak, you should definitely take advantage of it. I had just such an opportunity last week at his brother Skip’s farm in Nokomis.
Too often, some of us are guilty of narrowing our focus to exactly what is going on in our state, region, county or township. Danny does a great job of analyzing global and national factors and showing you how that may affect your farm.
Last week, Danny made a great point that is worth repeating. He was speaking about different sectors of farming. He sees a big change coming in specialty crop farming. For those Illinois farmers fulfilling vegetable or even seed corn contracts, sit up and take note.
Danny explained the issue from the standpoint of a corporation looking to fulfill X amount of supply with specialty contracts. As time goes on, some growers will drop out for whatever reason. Maybe they couldn’t meet the quality standards. Perhaps they decided it was too much work. Either way, corporations have smaller growers giving up more and more small contracts each year.
From the corporation’s standpoint, what makes more sense? Should you go out and find another small grower to take their place? Or, do you go to your best, large growers and ask them if they can take on a little more production?
As many of you already know, they go to the big guy and ask him to plant more acres. Why shouldn’t they? As Danny points out, the big growers have a proven track record. They know the process. Plus, the corporation has fewer suppliers to deal with.
For those with specialty contracts, I have no idea where you are in terms of your agreements. Just realize that more opportunity could lead to more opportunity. On the other hand, turning down an opportunity could put you on a list you don’t want to be on.
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