About This Episode
Sam and Chad Dykshoorn are fourth generation farmers at Foremost in southern Alberta, about three hours north of Great Falls, Montana, on ground their great-grandfather reached in 1907. They run a mixed operation of beef cattle, small grains, alfalfa and other forages. Their father began moving away from cereals only in the early 1990s, adding yellow peas, lentils and later chickpeas for disease prevention, spread risk and the health of the land. Six crops is a normal rotation locally, but mixed crop and cattle operations keep disappearing.
Sam puts the reason plainly: cattle are largely a lifestyle choice, and there is often not enough revenue in them to justify the extra labor. The brothers have started selling part of the herd direct to consumers to find margin where they can. Chad expects Canadian margins to tighten toward what US producers have faced for about five years, and flags farm debt as the issue Canadian agriculture will have to work through. The carbon tax shows up on utility bills and gets passed along through fuel and logistics.
On trade, southern Alberta is tied directly to US markets on cereals, and being close to the Montana border gives them a marketing option that can pay a premium on the currency exchange. Chad wants USMCA finished and calls the end of Canadian canola exports to China entirely political rather than a quality problem. Both brothers argue farmers have to take information to consumers rather than wait to be asked, through grade school programs and open farm days, and stay open to changing their own practices.
“We can't just tell people, trust us. We have to earn their trust a little bit too and prove that we're doing everything in our power to provide them with a safe, healthy product.”
— Chad Dykshoorn
Key Takeaways
The farm runs cereals, yellow peas, lentils, chickpeas, alfalfa and forages plus beef cattle. Sam says an average area farm grows about six crops, but very few still keep cattle alongside them.
Cattle numbers have dropped over the past decade because the revenue does not cover the added labor, which is why the Dykshoorns are testing direct-to-consumer beef on part of the herd instead of the whole herd.
Chad names debt as the coming pressure point: Canadian farms took on more of it during good years and now face margins similar to what US producers have had for roughly five years.
Canadian government support is thinner than what they see from US members of their peer group. Aside from crop insurance there is little to draw on, and the new carbon tax adds cost across purchased inputs and freight.
Canola exports to China ending softened markets across Canada even for growers like the Dykshoorns who do not plant it, and Chad reads the cutoff as political rather than quality related.
Their area is semi-arid shortgrass prairie farmed with zero till, and new local processing, including a mustard processor, is opening dryland market options that did not exist before.
Full Transcript
Shay
Foulk: And it all comes down to this. 2 on, 2 out, bottom of the 9th. The Farmers lead by 1. Full count. Here comes the play at the plate. And it's the Ag View Pitch! Welcome back, everyone, to another episode of the Ag View Pitch. And we're up here in Canada today. Unbeknownst to us until yesterday, it is National Canadian Ag Day. And I know the special guests that we have here today know all about National Canadian Ag Day. So we're going to jump into that. But I was wondering if you guys could just you know, give us a little background on who you are, where we are today, and kind of what your cropping operation looks like here in Canada.
Sam
Dykshoorn: Yeah, Sam Dykshorn and my brother Chad Dykshorn, uh, we're fourth-generation farmers in southern Alberta. Foremost is the town. We're a mixed operation with beef cattle, and grain crops, small grains. And then also we put up alfalfa and different forages.
Shay
Foulk: Great. And, you know, we talked a little bit offline here about diversity, you know. So how long have you been involved kind of in each, each one of those entities, looking at the differences on, on the crop side and then the cattle as well? You know, how's that kind of changed over the years here on the farm operation?
Chad
Dykshoorn: I guess the diversity started quite a few years ago. Dad started that in the early '90s, switching away from pretty much only growing cereal crops to including pulse crops like yellow peas, lentils, and then adding chickpeas and stuff like that later. We've just kind of grown from that. We like to keep a real good mix just for disease prevention, spreading risk out. And stuff like that, and the health of the land. And then on the cattle side of things, I guess we've just more recently been moving to using, using different polycrops and annuals for grazing as well. And then diversity within the beef business as well, going with the direct-to-consumer beef business just to try and add some profit where we can find it, not on the entire herd, but just starting to do it with some of the herd. So.
Shay
Foulk: No, that's great. And looking at that diversification in crops, you know, people listening are thinking, you know, they're trying to add and they're running out of hands to count how many different crops y'all are running on there, which is a phenomenal thing. And with the part of the world that we're in, you know, we see it in the southern United States of a lot of times they'll have 4 or 5, 6 different crops because they have double cropping capabilities. It's part of their, their rotation. And then you move up into the Midwest and 3 crops is a lot looking at that rotation. So with the, with the diversification in this area, it's a little bit of a whole different world. And with the shorter growing season, the challenges with growing some of these crops are, are pretty huge.
So diversification was probably in some sense, a necessity, and then also looking at the profitability margins associated with that. You know, how long has that been kind of common practice here? You mentioned in the '90s some of this was implemented, but is it, is it common in this area, or how does that look as far as the number of crops that we see here on your farm operation?
Sam
Dykshoorn: I think it's common to be diversified, maybe not quite as extensive as we are. I would say an average farm probably is growing, yeah, 6 different crops, but there's not, definitely not a lot of mixed operations, fewer and fewer that have cattle also. And yeah, I would say probably in the last 10 years there's been quite a few that have kind of dropped out of the cattle.
Shay
Foulk: And why do you think that is? What's the reason for that lack of diversification with livestock and crops?
Sam
Dykshoorn: I think it's a lifestyle thing mostly, actually. There's not enough, probably not enough revenue from the cattle operation to justify the extra labor.
Shay
Foulk: Interesting. So that kind of ties back into the topic of the conversation here, looking at, you know, Canadian agriculture, um, with the challenges presented on that end. How is Canadian agriculture changed here in the last couple of decades? What shifts have you seen in the operation aside from diversification? You know, what is the— we just had the State of the Union in the United States. What's the state of Canadian agriculture from your perspective right now?
Chad
Dykshoorn: I think Canadian agriculture has come off some really good years and we can still, still find profitability where we're at now. But I think our trend is going to be definitely tighter margin, probably something similar to what the U.S. has been dealing with for probably close to 5 years now as far as profitability. One of the biggest things with Canadian agriculture is there's a lot of debt. And I think that'll be something that'll be addressed, you know, in the future here is how on tighter margins, how our farm operations are going to deal with the higher level of debt that they've taken on. I guess some of the other things in Canadian agriculture is that Canadians have dealt with is more continuous cropping, less chem follow, larger equipment to cover broader acres and try and control costs that way, even though there's challenges within that as well.
Shay
Foulk: So let's steer a little bit more towards the government side of things. And it's a touchy topic anywhere in the world when you start talking politics and government and Everybody has it worse than everybody else based on where you live. But, you know, what, what are some of the challenges associated with government involvement in agriculture? Maybe what are some opportunities or strengths that you see as part of their involvement? And then maybe a little bit, you know, you guys are involved with the peer group that we have, majority of the producers are in the United States there. So what differences do you see, you know, with government involvement on the agriculture side as opposed to here in Canada?
Sam
Dykshoorn: I think from what we've learned from our peer group especially is that there's a lot less involvement in Canada than there is. There's a lot less programs. Aside from insurance, there's not a lot of programs that, that our government offers that you can dive into and use right off the bat.
Chad
Dykshoorn: Yeah, no, I'd agree with that on the— definitely on the crop insurance side of things. The other involvement that the— on the Canadian side, the government has initiated that's going to be an added cost to farming operations is definitely the carbon tax that we've had introduced. So that's going to drive the cost of a lot of things up. There is some exemptions, but still across the board, that tax is going to be added into products we need to buy and stuff like that.
Shay
Foulk: What does that carbon tax look like?
Chad
Dykshoorn: The exact details, I don't know off the top of my head, to be honest with you. But it's right on our utility bills. And it's built right into, you know, gas prices and and stuff like that as well. And then that has to be passed on, especially for companies involved with logistics and stuff. They're going to definitely have added expense, so they're going to pass that on and somebody eventually has to pay for it.
Shay
Foulk: So let's talk a little bit about the trade side of things. Obviously a little bit going on here the last 6 months or so, looking at trade between nations and then even worldwide trade. And, you know, there's some areas in Canadian agriculture that I know have had huge benefits as a result of some of the trade shifts that have gone on and some areas that are maybe suffering a little bit more. How do you feel about the trade outlook, what's going on here in the country and maybe what that looks like moving forward?
Sam
Dykshoorn: I think it's— we're tied so directly to the U.S. markets, especially in our cereals. Everything is off of the U.S. and As you guys have your struggles, or depends if you consider it a struggle or not, but with the trade talks and everything, it directly affects us, I think. Yeah, as far as the future, it kind of depends on how it pans out for you guys, I think.
Chad
Dykshoorn: The USMCA is definitely one that Canada needs, needs completely. Completed. And, and, uh, you know, NAFTA was always good for us. It's— it— especially us in southern Alberta, we, we have— we're close enough to the U.S. border, we have that as a marketing option to, to sell stuff, uh, down into— for us it'd be Montana usually. And, uh, and we can get premiums, especially with using the dollar exchange and stuff like that, uh, to our advantage. It doesn't always work, but definitely opportunities there. One of the biggest challenges right now, US looks like they're heading a little better direction than Canada has, is their relationship with China. We've had some crops cut off because of circumstances like our canola exports to China has basically ended. And that is something the government has to resolve because I think it was entirely political.
It wasn't the quality of the product or anything.
Shay
Foulk: And when did that occur and how's that, you know, affected production in this area?
Chad
Dykshoorn: That, the canola last fall, or last spring already, yeah. We don't grow canola, so we don't pay quite as much attention to it, but it's one of Canada's largest crops produced, so it's a huge deal for a lot of producers in Canada and I don't know exactly how it's affected them directly, but we know the market has definitely softened because of it.
Shay
Foulk: So. Right. Now, one thing that I want to kind of squash here is a lot of times when people that haven't been to Canada or haven't been much farther out of their backyard, they think, oh, Canada, well, it's cold up there. You know, I mean, everybody, for whatever reason, if you get below Minnesota, everybody thinks that Canada is just this wintry wasteland. And it's not, you know, the amount of agriculture up there. Out here is phenomenal on a scale that I don't think many people actually realize. If anyone's driven through Kansas, Oklahoma, just the stretches of wide open land, it's really what it looks like out here in some instances. And there's huge agriculture. But to back up maybe 100 years or so, what we see here today was nothing like it has been in the recent past.
You know, 100 years ago, if I understand correctly, your family homesteaded in this area and worked it up to the scale where you are today. Can you just speak a little bit about, you know, how drastically that's changed in the last 100 years and, you know, how that's affected your family here today?
Sam
Dykshoorn: Yeah, like you say, 1907, our great-grandfather came here and yeah, it's— every generation has seen immense changes as far as size of farms and the technologies that come with it. The development of this area between the railroads and the access to market we have being so far from Port, it really has made all the difference.
Chad
Dykshoorn: Yeah, this was— The area that we farm in is a shortgrass prairie country. It's actually classified as a semi-arid climate, so it is a drier climate, but the technology that's been adopted over the years, you know, it started back with just even using strip farming to prevent wind erosion and stuff like that, to now zero-till practices and stuff. And then just north of us, we don't have any irrigation, but the huge irrigation development is has brought huge economic returns to Southern Alberta, and Saskatchewan is developing that as well. So it's a lot of labor in really, in reality, a short period of time has developed the agriculture industry in Canada.
Shay
Foulk: With that being said, are there any major changes on the horizon, you know, for this region or agriculture as a whole in this area that you think is going to have huge impacts on how we operate day to day or, you know, the products and quality of things coming out of this area?
Chad
Dykshoorn: That's a good question.
Shay
Foulk: If we knew the future, we'd probably be betting people, right? Yeah. Wouldn't it be in farming?
Chad
Dykshoorn: But I think the biggest thing, like newer things, is processing in that has come in directly to our area. We've seen a lot more in the, in the irrigated crops like potato processing facilities and stuff like that, but also even just recently a mustard processor has bought into the area, and those are the type of crops that can be quite successful on dryland operations as well. So it's exciting to have another player in the market right here On the dryland side of our area, most of what we grow is for export markets. So it's more maintaining those relationships with the other countries and making sure that politics don't get in the way of good business.
Shay
Foulk: I want to shift gears a little bit to a discussion that we were having here at an awesome lunch, just looking at how the political perception, as you put it, or also just the social dynamics of some of what we do as farm operations, that's not restricted to certain areas. I mean, people are having the same conversation, conversations with GMOs, antibiotics, and how we conduct our marketing. And looking back a little bit at the responsibility that we as farmers and producers have, you know, we can't just blame the consumer all the time. We have to actively advocate for agriculture. We have to actively educate those who are purchasing these products. You know, looking at the beef side, or, you know, with the products that you're growing here in the fields, what do you think is being done well in that area?
You know, how do you think people are positively impacting that change for Canadian agriculture and agriculture in general? Is there anything in your mind that kind of sticks out?
Sam
Dykshoorn: Kind of as we were talking at lunch there, just that girl from our community that's part of Nutrien and the amount— the program she's developed for, for grade school classes and stuff. If you can start educating sooner like that, it makes a huge difference. I think between— well, through our beef business, we've learned that The only way is just to communicate directly with them. They don't— it doesn't seem like the public is going to search out this information unless you kind of go to them with it. And a lot of the big companies are realizing that now. We might be 10 years behind the ball on that one, but it's better now than never, I guess.
Chad
Dykshoorn: Yeah, and some of the things that, that are happening more locally, and actually my wife Tanya, she would like to even do this on our operation, they have open farm days. So we actually invite people to come in and you show them around and just be real on the challenges and the benefits of how we do things and A lot of that has had to be a mindset change for myself and I think all of us, that we can't just tell people, trust us. We have to earn their trust a little bit too and prove that we're doing everything in our power to provide them with a safe, healthy product. And, but also opening our minds up that we can make changes within our own operations that help those people be okay with how we do things too. We can't always be closed-minded to new ways of doing things.
Shay
Foulk: Right. And all those are great points. Well, you know, I think, I think we hit on a lot of topics here. And I think it's important just for, you know, this perspective piece on looking at how agriculture is impacting people all over the world. And the differences or the challenges and struggles that we see in the United States are the same as Mexico and Argentina and Canada. There's differences there, but we're all going through this together. And I think there's opportunities for us to learn from each other. So, you know, appreciate you guys taking the time for the conversation today. Are there any last thoughts that you have on Canadian agriculture or what you all have going on in your area that you think is a good note to end on here?
Sam
Dykshoorn: I just think it's exciting, the, the new technologies and the way the industry is going. In this area and anywhere you go across North America or anywhere, I think the leaps we're making in a short time in the last 5, 10 years is, is really exciting for the future.
Shay
Foulk: That's awesome. I think we'll end it on an optimistic and positive note there. Thank you guys very much for taking the time to have this conversation today and appreciate you guys giving us a little insight into your world here and Canadian agriculture. So thanks a lot, guys.
Chad
Dykshoorn: Thank you.
Shay
Foulk: Thanks for having us. And for everyone listening, we will catch you next time on the Ag View Pitch. Thanks for joining us on today's episode of the Ag View Pitch. As always, you can reach out to us at cbarron@agviewsolutions.com or duanel@netins.net. We'll catch you next time on the Ag View Pitch.