Canola offers Northern Plains farmers economic, agronomic benefits

2013-03-25T11:21:00Z Canola offers Northern Plains farmers economic, agronomic benefits Farm and Ranch Guide
March 25, 2013 11:21 am

There is greater demand now for heart-healthy canola oil in the U.S. than ever before, and with canola now selling at a 12 to 15 percent higher price over soybeans, it is something farmers may want to consider as planting approaches as it may provide both economic and agronomic advantages.

“Canola has been trading at a premium to soybeans for much of the last two years,” said farmer Rob Rynning of Kennedy, Minn. “This helps make canola very attractive as a rotational crop.”

According to Northstar Agri Industries, which opened a canola crushing plant last year in Hallock, Minn., regional growers get a 30- to 40-cent basis advantage over the trading price of canola due to local delivery and domestic use of the crop.

“The Hallock plant provides a better basis due to increased demand and also saves me transportation costs,” said Hugh Hunt, a nearby farmer who has grown canola for 25 years and plants a three-year rotation of soybeans, canola and winter wheat.

Moreover, canola in such a rotation can lead to more sustainable crops and profits due to less weed resistance and disease buildup. For winter wheat, canola stubble acts as a snow catch for the new crop, helping prevent winter kill while preserving moisture.

“Our farm started raising canola in the mid-1990s because of a severe disease issue in our spring wheat,” Rynning noted. “Canola helped save our wheat production at that time. Now we grow it ahead of winter wheat and no-till into the canola stubble. The winter wheat crop has averaged 12 bushels an acre better than our spring wheat since we have started using that practice.”

“I have kept canola in the rotation even in years of lower margins due to the benefits of planting winter wheat,” added Hunt, who averages 40 percent better yields with winter versus spring wheat. “An early harvest and high yields spread out the work load and increase profitability.”

Northstar is offering a 5 percent premium to farmers on the first 1500 pounds per acre for those growing high oil-containing and high-yielding canola varieties. Farmer delivery of the seed is easy with the crushing plant located in the heart of Minnesota canola country.

“Canola has helped diversify cropping and reduce financial risk on our operation,” Rynning said. “It has been very good for our bottom line. Last season, we grew the best crop of canola we have ever had (2,200 pounds per acre average) and also received some of the highest prices we have ever sold it for.”

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