A year after widespread crop disaster, the Federal Crop Insurance Corporation extended provisional coverage to canola for 2007. Although insurers tinkered early with the yield guarantee, Matt Gard, Fairview, Okla., farmer, believes the result is a workable safety net in most cases.
“Eighty percent of the typical wheat yield is more than fair,” Gard says of the coverage. “Typically the first or second year of growing canola, you get an 80 percent crop comparable to a typical wheat yield. Yields improve as farmers get comfortable growing canola.”
Eventually, a track record of reliable crop production history should lead to a permanent program. Gard, who is also a seed dealer and certified crop advisor, would like to see that happen.
For now, an area's average historic wheat yields will influence canola insurance. Those who consistently raise wheat for grazing rather than grain will face yield guarantee restrictions. Gard believes farmers in Southwest Oklahoma have as much opportunity to grow canola successfully as those further north but concedes that insurance coverage will be hampered by “wheat yields not what they should be.” Areas of the Southwest have also been hardest hit by drought, while the panhandle has become the state's unexpected “garden spot.”
Gard was one of the first farmers to jump on the canola bandwagon after attending a meeting in Kansas four years ago.
“I saw possibilities with canola and what it would do for local farmers, even if they rotate it on just 10 percent of their acreage,” he says. “This will help clean up wheat fields and that benefits the grain elevators so they can pay more. Plus, a farmer will typically get a 15 percent increase on next year's wheat harvest because he rotated to another crop.”
Farmers have several strong canola varieties available. K-State's Sumner is the only one that can be planted following wheat treated with sulfonylurea broadleaf herbicides (such as Glean, Finesse or Maverick). Farmers have “Round-up Ready” or conventional seeds.
There's some evidence that canola will work as a winter forage, too, although more research is needed. “I got along great grazing it for two years,” Gard says. “But one year it got too wet and the plants were badly bruised, which resulted in a yield loss of 10 to 15 percent. Probably the best money for a producer is not to graze it and go for the yield.”
Local canola prices have varied widely since the crop was introduced, when bids of $12 to $14 a hundredweight were widely quoted. Last summer, elevators were offering around $9 a hundredweight and, Johnston Enterprises in Enid, one of area's leading canola merchandisers and handlers, is forecasting prices will be $10 to 10.50 per hundredweight next summer.
Canola follows a similar production cycle as wheat, with harvest in June.
As of December, Johnston wasn't taking old crop canola. Due to its high oil content, it's a difficult crop to store on-farm, particularly with Oklahoma's warm climate, Johnston's Joey Miebergen said.
Another obstacle hindering prices is transportation. “If you have to ship it to Velma, North Dakota, that eats up too much freight,” Gard says. ADM operates a large crushing plant there and is building an adjacent biodiesel plant.
Gard and other industry leaders would like to develop more local end-users.