Spray/Chemical Prices

Discussion in 'Tillage' started by marco, May 4, 2013.

  1. Sheebadog

    Sheebadog Well-Known Member

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    The supply chain is a cosy cartel. Always was.
    Clive is not taking on the chemical/seed etc companies, he's taking on the supply chain.

    Why discuss Clive?
    Why not discuss the profiteering of distributors and merchants?

    A small example. I was quoted €1600 for a set of liners for my milking parlor by my local suppliers. The exact same liners can be bought in Ireland sub €500. I had to route the liners through an Irish address for fear of the French suppliers putting a 'lean' on the Irish company. That's what needs to be discussed...
     
  2. Ugo Schtiglitz

    Ugo Schtiglitz Well-Known Member

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    I did this year. Didn't make a total cock of it. Supply chain here could defo do with a handgrenade dropped in it. So much politics and aggresive protectionism when you try to alter it. More power to Clive "ceriax" Bailye, as he's known down around schtiglitz towers.:lol:
    Very important point for discussion tho. How can we as farmers dirupt the pricing strategies of the market here?
     
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  3. Louis mc

    Louis mc Well-Known Member

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    Really....I thought be were basically on the same page just, opposite ends of it
     
  4. Louis mc

    Louis mc Well-Known Member

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    Clive is an easy target though, sure he has easy soils and loads of land and a few websites and 2 fendts and a big house, sure it's alright for him....
     
  5. Sheebadog

    Sheebadog Well-Known Member

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    The suppliers have two powerful tools. One is credit and the other is the illusion (as Blackwater boy alluded to) that you'll have no one to buy your produce.

    The Merchant credit vicious circle is the stranglehold that's on farmers...
     
    Last edited: Jul 28, 2017
  6. Louis mc

    Louis mc Well-Known Member

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    This

    Vicious circle indeed.
     
  7. Ugo Schtiglitz

    Ugo Schtiglitz Well-Known Member

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    I think credit provision is the main business to be honest. Increasingly unhealty for both parties. Chem prices are definitely fixed to a min sale price by didtributors. There is very little real competition for cash business I feel.
    On the sale of produce side, I think Comex and Halls have a little bit too much of an interest in low domestic prices.
     
  8. Sheebadog

    Sheebadog Well-Known Member

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    The big Ag industries (chems, fert etc) price up their products to the max that the market can take. Ireland would not be singled out by them as a separate market...most likely lumped in with the U.K. as with most other industries like retail...clothes, food etc. (Wasn't it Tesco that coined the phrase 'Treasure Ireland'?).

    Who's the main importer/distributor of chems in Ireland? Likewise fertiliser?
    Is there even an ounce competition? Or a cosy monopoly?

    There was a landmark case here recently where it was passed that I can now buy wormers etc wherever I want within the EU. The result is that the likes of a litre of Panacur (Fenbendazole 10%) has fallen from €77 to €22. Just a tiny example...

    As margins are continuously eroded maybe it's time to call out the industry?
     
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  9. Sheebadog

    Sheebadog Well-Known Member

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    Does anyone know who are the main importers/distributors of chemicals and fertilisers in Ireland?
     
  10. gone

    gone Well-Known Member

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    The chemical companies, import and distribute themselves in general, but the sellers have formed buyers groups. The fert is dominated by a small group of importers.
     
  11. CORK

    CORK Well-Known Member

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    Couldn't agree more. I've said before but the lack of knowledge / interest in crops and agronomy amongst many Irish tillage farmers is frankly sad.
    Just go to any Teagasc tillage walk and the evidence is there - probably 60% trade and 40% growers.

    Knowledge is power. Too many guys have become little more than tractor drivers.

    I speak regularly (once every two weeks) to a beef/tillage farmer in his early 60's. We discuss varieties, sprays etc. This man has farmed all his life, used to do a lot of tillage as well as spray contracting.
    When I first met him 6-8yrs ago, he was disheartened and losing interest in tillage.

    He commented the other day that through chatting and learning, his interest and satisfaction in crops has been really rejuvenated. His yields have increased too.
     
    Last edited: Jul 28, 2017
  12. Ugo Schtiglitz

    Ugo Schtiglitz Well-Known Member

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    It is high time to call out the industry. The CAP is not meant to be a mechanism for transferring money out of tax payers pockets back into Helmut Claas and BASF etc, but we have let it happen. There are far too many protected monopolies here and all riding on the backs of farming. From veterinary services to milk socks and chems, I find it desperately odd that there is a common market for labour, transfer of capital and so forth, but a can of generic azole or ctl has to be approved differently here. I think the PCS is to a degree protecting a monopoly because regulation means each product has to be seperately approved across the eu. What a load of shite. Layers of duplicated approval, for what? and in whose interest? Common market me hole!
    I realise that everyone has to turn a few euros, but when ag is in the predicament it is.....we should be first.
    A german friend comes over fairly often and we went in to Lidl to get a bottle of wine one night. She was rolling around laughing at the prices. The market here is priced to the point of what the customer will bear, and seemingly we can bear a lot.
    Gone makes a very good point as well. The pace of consolidation of power in the supply industry has not been near matched by any organisation of buying or selling power by primary producers. We have paid a price for misguided "competition" with our fellow farmers rather than driving at something that can really alter the game...consolidation of our own buying power.
     
  13. nashmach

    nashmach Well-Known Member

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    Can't add much to the above, but in the past year or two we have seen Major mergers and acquisitions in various supply companies (some of which were mentioned above).

    In all cases these were for eye watering amounts in the billions. Now you don't have to be a genius or done a degree in valuing companies, but we all know the price paid is mainly down to the value of future earnings......

    Corks point is very valid too. I know we can't talk here with our own setup but it always amazes me how many of the soil samples taken each year are suboptimal and these are coming in the main from those who are more progressive on it. I saw a graph recent that had just tillage samples and it was no better than the general samples which is startling really.
     
  14. gone

    gone Well-Known Member

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    The TFF initiative has hit a bump in the road already, Clive is a very able and driven man, has the backing of many big hitters and may still be able to get around this.
    I do not believe it is only local distributors and merchants that are profiteering, they don't set they price of CAN in Ireland or the price or the leading SDHI / Azole.
    There are good examples of good companies and reps that have tried something new and very quickly got put back in their little box, bought out or shut down.
    I know that I can come across as a bit negative on this topic, but that is because I have been involved and have seen a lot of similar efforts tried and there tend to be more failures than successes, that doesn't mean I that this one or the next one wouldn't be great brake through.
    There is great scope on here for sharing info on here, but @Blackwater boy is right, if the Irish tillage sector want to reduce their "price taker" dependence on the merchants, distributers and multi national manufacturers, they need to wean themselves off merchant credit and agronomy.
    Profits '16 approx
    Bayer $12 Billion
    Basf $7 Billion
    Monsanto $2.5 Billion
    Syngenta $2.7 Billion.
    I still think we should be going after the big profit takers more than the local merchant, but one doesn't have to preclude the other.
     
    Last edited: Jul 29, 2017
  15. Ugo Schtiglitz

    Ugo Schtiglitz Well-Known Member

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    I don't begrudge the local merchant a living and they do provide a service on slim enough margins. Across the business, one would expect not much better than 2-3%. However a system has evolved that retards the industry in some ways. I don't think we can compete at all on the lowest common denominator which is ruminant feed production. It appears that our brethren in livestock production are happy to buy imported shit to feed to their stock. So import it I say, and lets grow some crops that we can turn into something to export.The tillage sector here needs to move away from that feed dependence. It has suited the trade too well for generations.
    We need to become different. Why not be a european seed house? Why not move totally into human consumption grains and seeds and play to our strengths? I suppose the answer is we don't see them making us much more money for the hassle. Why aren't they worth more money to us? Because we don't own enough of the chain. Our co-ops have made some inroads in this, but they are still short changing us on human consumption products because they all have one eye on being divested at the moment. They can't make it look like too good a business for their growers.
     
  16. Always Thinking

    Always Thinking Well-Known Member

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    I've been saying for years Merchant Credit should be banned. It is ruining us. If you need credit go to a bank.. Its gives the supply industry a double handed grip on our business and as a result on our Liathroidi :sad2:
     
  17. Always Thinking

    Always Thinking Well-Known Member

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    I wanted to buy something once, and sourced it in Germany but they did not want to deal with me but put me on to their partners in UK, there was an issue with them as they did not want to deal with me as it may upset an Irish company they do some work with so they went through them, the Irish company did not deal direct with farmers so wanted me to price through a merchant who wanted a cut/handling fee also. What was a good product well priced was now over inflated and not value anymore. But at least the three middle men made a few quid! Feck sake!!! Lads, this is a very useful discussion i've no idea how its done but we need to get a grip of our businesses in order to make a bit !
     
  18. thefarminglad

    thefarminglad Well-Known Member

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    I wanted a new dromone hitch for my tractor, so rang Dromone who told me they dont deal with the public any more and farmhand supply them. So then i rang Farmhand who told me they dont deal with the public and i would have to contact my local tractor dealer. As i knew someone in the tractor trade i got a price off him( he told me what it cost him for hitch). Then i rang up my local tractor firm and got a price off them. Now all it takes is for them to make a phone call to Farmhand and order hitch and no hassle.

    I wont tell a lie, i got hitch off friend for nearly 400 euro less than what the tractor dealer wanted. Tractor dealer knew i was a cash customer but you can talk about overheads as much as you want but 400 euro extra profit on what i paid for hitch is just pure disgusting for someone who only had to make a phone call and place a order. Bit off topic but greed in the trade is a major problem. I have drove into a lot of merchant yards in County Wexford and the amount of new buildings and machinery in them is crazy when you see tillage farmers on there knees
     
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  19. Ugo Schtiglitz

    Ugo Schtiglitz Well-Known Member

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    That last point is a key one. The merchant trade has the volume to invest in storage drying etc. They are mostly working to produce animal feed. If you want to sell a load of milling wheat at harvest, most of them won't bother to quote because of the clean down/small batch drying. If you wanted to grow a niche product, who can handle it for you if the merchant won't. We could be growing mustard, oil for pressing, maybe pulses for human consumption....but if the man owns the store and dryer and the contacts and the market......He gets the cut. If farmers owned it, we might be better able and more willing to segregate for quality and niche markets never mind the feed hape. The cheque in the post has made us lazy and commercially ignorant about building linkages, finding out what high end markets need and supplying it.
    TAMs missfired completely for me because, the sensible thing would have been to promote small scale co-op structures to handle grain between a few farmers.
    Instead dangle the prospect of shiny paint in front of us and we all forget about anything worthwhile. It'll be rusted out and depreciated down to nothing and we'll still be having the same moan in 10 years time I fear.
     
  20. Ugo Schtiglitz

    Ugo Schtiglitz Well-Known Member

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    Just to add to this, one of the most heartbreaking things that happened me when I moved home to farm was when I (very young and niaive) asked the local co-op boss if there was anything that they wanted grown (me thinking seed/mill wheat/something for a market) He says "not really, shur we get enough of it".
    That's the attitude eh?
     
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  21. Sheebadog

    Sheebadog Well-Known Member

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    Excellent post Ugo.

    With Brexit on the cards and the strong probability that sfp will cease for the UK farmers, I think that it's sharpening their minds.

    If sfp was finished in the morning would farmers rethink their position in Ireland?

    In the grain prices thread I read some eye watering prices for green feed barley, is this the trade giving back some of *your* money that they've gouged from ye? Or do they know something that world markets don't?
    Just wondering...
     
  22. Ugo Schtiglitz

    Ugo Schtiglitz Well-Known Member

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    Couple of points in that.
    No grain could be grown in ireland without the sfp. At least not under current modes of production. Its that simple.
    I think a teagasc report on the quarter suggested favourable outlook for dairy in a stable cost environment out to year end and beyond. I am a cynic and I humbly suggest that we will see a gearing up feed prices. The trade might see it as needing to get some money back, throw 5% at grain growers to pay their bills and crank compound feed by 10% to take a little back out of dairy.
     
  23. Sheebadog

    Sheebadog Well-Known Member

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    It's possible I suppose.

    Insidiously if that is true, and the coops/merchants are robbing Peter to pay Paul, then market manipulation is afoot...therefore, can it be taken as possible (or probable) that they are also manipulating the market for inputs?
     
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  24. Ugo Schtiglitz

    Ugo Schtiglitz Well-Known Member

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    You think they don't? A former minister once said to me if you want to succeed in business in ireland, follow the eu money and decide how much of it you want to take.
     
  25. guest 1

    guest 1 Guest

    I grew grain for a number of years with no SFP. There would be a margin in it on owned land if borrowings were reasonable and you weren't trying to have bigger and fancier gear than the neighbours. There would be a margin on rented ground if conacre prices reflected that achievable margin instead of being grossly inflated by the SFP. That's based on my own figures and not something spewed out by Teagasc to suit another agenda, although I'm sure they'd never even dream of such a thing.
     

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