Eyes forward with a few glances back

EVERY YEAR AT THIS TIME, THERE’S A COLLECTIVE EFFORT TO LOOK BACK ON THE GROWING SEASON that was and cast a glance toward the days, weeks and months ahead with a mix of cautious optimism, anticipation, and apprehension.

WELCOME TO DECEMBER

The 2024 growing season in Ontario will be remembered as a contrast of wet weather at the beginning and yield forecasts heading to harvest that were sizeable, perhaps larger than expected just a few months earlier. Yet, as with most years, there were the behind- the-scenes factors that influenced growers’ decisions throughout 2024 and may continue to affect them well into 2025.

Ontario Grain Farmer spoke to four individuals, Jennifer Doelman, Crosby Devitt, Don Kabbes, and Neil Hemingway, and asked each for their perspective on what was learned from 2024 and what’s ahead in 2025. All agreed that this past year started with a wet spring, challenging growers in their efforts to get corn and soybeans – and other crops – in the ground and then to navigate a wetter-than- normal mid-season. However, what further confounded operations were ongoing job actions, emerging trade issues, and supply chain disruptions.

JOB ACTIONS

The effects of strikes across Canada in 2024 weren’t necessarily devastating, but they were enough to hamper most farmers’ operations in one way or another. Cargill went on strike at the end of May and affected beef production in Ontario to the extent that producers had to continue feeding animals ready for market that weren’t shipped. That delayed those buying calves and moving things through that value chain.

At roughly the same time Cargill went on strike, Viterra workers did the same, affecting oilseed crush facilities, including one in Quebec, which directly affected Jenn Doelman, a farmer from Douglas in Renfrew County.

“They’re our main buyer, and they were on strike until September, so we did not have any way to ship our pre-contracted canola during harvest,” she recalls. A subsequent rail strike meant harvested product couldn’t be loaded, putting a premium on local trucking, which instead was called on to ship canola meal, usually delivered by rail. “Normally, we trade our straw for manure with a local trucker, and this is usually done in that August window so that we get manure on our fields. The manure wasn’t available for transport because the trucks were needed to haul.”

Although the rail strike was relatively short- lived, a port strike in Vancouver and a similar action later in the fall in Montreal was one more combined labour action that affected Ontario farmers, particularly the Montreal strike. According to Don Kabbes, general manager of Great Lakes Grain in Chatham, the impacts of these types of events aren’t always well understood.

“The challenge with the ports is that a one- day labour disruption adds three to four days of backlog for the system,” he says. “Any disruption can lead to product outages and impacts further along the supply chain. And it appears the job actions are happening more often in our industry.”

Kabbes also believes growers are increasingly aware of the implications of job actions. Delays in harvest for export shipping are immediate, while inbound fertilizer has a huge impact, with much of the product shipped “just-in-time,” making it difficult to source fertilizer off-shore in a narrow time frame.

HARVEST

Considering how wet the growing season began and how it stayed wet through much of mid-summer, the harvest season for Ontario wheat, soybeans, and much of the corn turned out surprisingly well.

For Neil Hemingway, market advisor with Broadgrain in Stratford, those yields may be a welcome boon to growers in the short term. However, in the long term, it’s going to be a challenge, especially given production outlooks in other regions of the world, resulting in lower commodity prices.

“We have increased supply, more than we expected, and the demand has been cut because of those high prices of recent years because people find alternate buyers, end- users find alternate products to use that takes a while to come back,” adds Hemingway.

The advantage for North America is the ability to store grain; growing areas like Brazil and Argentina must move their production at harvest, which typically is the lowest price point in a marketing year. If growers in North America aren’t happy with prices, they store it, says Hemingway. The world knows North America is always here with a “warehouse of ag commodities,” so with geopolitical issues, they’ll go elsewhere and come back here to top up their needs.

Kabbes has a similar assessment in terms of the markets and the effects of the harvest. He says commodity corn, soybeans, and wheat are well supplied throughout North America, and the U.S. will be close to having record corn and soybean yields, leading to large carryouts. “It feels as if large crops get bigger, and this year seems to be the same,” says Kabbes, measuring the outcome against conditions earlier in the year. “Many growers were unsure of the amount of crop planted and the condition of that crop to forward contract as normal.”

MARKET DEVELOPMENT

With the potential for yields in Ontario to reach new heights year-over-year, the need to expand the reach for corn, wheat, and soybeans (as well as oats and barley) is a focus for many, including Grain Farmers of Ontario. Crosby Devitt, CEO of Grain Farmers of Ontario, was part of the trade mission to the United Kingdom and the European Union in mid-October and returned with a renewed sense of purpose. He says demand from the EU and U.K. continue to grow, and soybeans and grains’ importance is solidifying and expanding.

“In roundtable discussions with the U.K. and Ireland, the talk was about Ontario and our supply,” recalls Devitt. “It instilled in me how important our crop is to them. Our logistics are good, going over there, getting corn into those markets; 10 per cent of our corn is going into the U.K. and the EU.”

The attraction of Ontario was another point of discussion during the trade mission, with the war in Ukraine affecting its viability for moving commodities. In that respect, Ontario becomes a more enticing trade partner.

GEOPOLITICALLY

It’s enough that Doelman is a delegate with the Grain Farmers of Ontario, a Certified Crop Advisor, a local director with the Renfrew County Soil and Crop Improvement Association, and an instructor at Algonquin College’s Agri-Business program. But she’s also one of the Canadian canola farmers affected by China’s anti-dumping investigation into canola seed exports from Canada. While trying to juggle concerns about local trucking and getting her canola harvest delivered, she’s a board member of the Canadian Canola Growers Association and is one of a group of farmers across Canada who has been providing their own farm’s financial information to lawyers and accountants to provide concrete, farm-based information on Canadian canola’s cost of production as part of this defence.

“All this has to be done with very tight timelines because the Chinese Ministry of Commerce only gives a short time for evidence to be submitted, and everything has to be translated,” says Doelman. She’s concerned Ontario – and Canada – will see more of this kind of weaponization of food despite claims of the need for global commerce.

“Even with great trade relations, our customers depend on reliable delivery of quality product. If our supply chains are tied up in labour action and mismanagement, it doesn’t matter how good the product is, it’s not going to get to where our customers are.”

Devitt echoes Doelman’s contention about the overall effect regardless of which countries are embroiled in trade disputes. Trade relations do have a direct impact on Ontario corn, wheat, or soybeans.

“But it’s a risk factor in the market, and we can’t anticipate or mitigate what’s going to happen,” adds Devitt. “We’re part of the same big family in commodities. It’s about how farmers can be competitive.”

2025 OUTLOOK

In the coming year, the focus is on staying the course in the face of lower commodity prices and doing the “little things” to be sustainable and profitable.

On a North American scale, Devitt points to the U.S.-Canada relations in the wake of the presidential election on November 5, followed at some point by a federal election in Canada. That will have an impact on a new Canada- U.S.-Mexico trade agreement.

Kabbes believes that as agri-businesses get larger, they can offer more technology services that individual businesses may not be able to provide, including smartphone apps, satellite imagery, record-keeping, and sustainability programs.

From Hemingway’s vantage point, lower prices are here for the short-term unless something significant alters global production.

“Global buyers will buy from North America, but the price needs to be competitive with other regions of the world,” he says. “In the past three or four years, marketing by procrastination has paid huge dividends to some growers.”

Farmers should watch how non-agricultural investments react to commodity markets in the year ahead. Every time the managed money gets excited, reward the rally. •