Retailers know that making growers competitive offers them increased dividends as well. So as the farm economy struggles with low breakevens, retailers are stepping up to the plate with unique offerings that go above and beyond the typical way of doing business.

In Iowa, Landus Cooperative is providing growers with an “easy button” that offers a one-stop shop for grain and agronomy needs, says Matt Brown, a regional sales manager who oversees agronomy in the co-op’s southeast region.

This fall Landus launched the Start to Finish Program, which is used to help fund specific inputs for the 2018 corn or soybean crop. The producer receives reduced input costs in exchange for a potential sale of next year’s crop. Every 5,000-bushel offer locks in a discounted price for selected inputs, specific crop nutrients, fungicide, seed treatments or the company’s brand soybean seed.

Co-op goes big

Landus Cooperative is the new organization formed in Iowa after the West Central Cooperative and FC merger closed a year ago. Having 7,000 members and covering 25% of the state, it is now the seventh-largest grain company in North America. From an agronomic standpoint, it covers 1.6 million acres with 60 pieces of application equipment and five fertilizer plants along major rail lines.

Brown says it was crazy not to utilize the powers that exist with the size and scope of Landus Cooperative in order to bring the best value to the customer.

“It is in the growers’ best interest to forward-contract their grain, and at the same time this allows them to hedge some of their bet against their costs,” Brown states. “Some growers are going to bring us grain anyway, so this was a way for them to spread their risk out from a grain marketing perspective while helping along with the input side.”

Grain marketing struggles

Many farmers say they have problems marketing grain, says Tom Guinan, vice president of producer grain marketing.

“We realized we could do a whole lot better trying to utilize different tools to spread that risk out,” he adds.

The bushels are entered as a non-revocable offer, with a very specific expiration date. Offer levels should be above breakeven, and the offer expiration date is during early harvest.

A grain sale is triggered if the referenced futures month is at or above the offer level at expiration. At expiration, if the offer hits, the futures portion of the bushels will be locked in and farmers will need to set their delivery period (and basis).

If the referenced futures month settles below the offer level at expiration, no sale is triggered; however, delivery is still required. In the event that no sale is triggered, the producer may use any grain marketing alternative offered by Landus Cooperative at that time to satisfy the delivery requirement.

Guinan says participation is limited to 25% of the expected volume of corn or soybeans. “We want our growers to use a variety of strategies to manage their risk portfolio on sales and agronomy needs,” he says.

Individual-based solutions

Gary Sabolik, general manager at Barrett Farm Supply in southwestern Minnesota, says rather than trying to find a cookie-cutter approach to meet a grower’s needs, they’re taking a hard look at individual solution-based selling.

“There’s a lot of focus on the purchasing team to drive costs out of the model, as it’s become so important at the farm gate to lower costs per bushel,” Sabolik explains.

For a grower, taking a look at the issues can be overwhelming, so Barrett Farm Supply examines how to mix and match all the different chemistries, seed solutions and nutritional needs on a per bushel basis in order to make growers more competitive.

Take weed resistance as an example. It can be a very confusing space for a producer to determine what the best option is for the business. “We try to grind through that and offer several different solutions of basics bundled with seeds,” Sabolik says.

One grower might be partial to a particular seed variety or hybrid. He may pair that with a cheaper generic chemistry to save $2.50 per acre, but he’s paid more for the hybrid. Others may take a different approach if they can see end-cost advantages by paying less for hybrids.

Sabolik says Barrett Farm Supply works to ensure growers that the co-op has their best interests in mind.

“It’s difficult to develop that level of trust where you’re truly a partner, but that’s our goal and vision,” he says. “We want to deliver the best solution. Our culture is to deliver what we believe is the best value, even if it’s not the most attractive piece for our business. We’re in this for the long haul and want to create a real win-win mentality.”