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HomeMy WebLinkAboutThe Times Advocate, 2004-12-22, Page 12Crossroads 12 Wednesday, December 22, 2004 Exeter Times Advocate Growers hear about a variety of issues By Mary Simmons TIMES -ADVOCATE STAFF EXETER — Approximately 40 pro- ducers gathered at the Exeter Masonic Hall Dec. 17 to attend the winter grower's meeting hosted by Borland Farm Service. To begin the meeting, financial adviser Jeff Young of the Norshield Financial Group spoke to the group about investing in hedge funds. He said the company's Olympus funds are among Canada's largest standing hedge funds, which were originally designed to remove market risk from investments. Young said hedge funds now include any invest- ment strategy other than traditional buying and selling of stocks and bonds. They offer absolute returns, long and short terms, moderate regula- tions and low correlation to the markets as well as often using derivatives and incentive fees. Young said the compa- ny's investment strategy offers different ways of making money by bring- ing together unrelated investments in a fund, resulting in less volatility. He also spoke to the group about how the markets go through bear and bull phases. "Stocks are trading rela- tively dear at the moment," he said. "But we think prices are going to come down. We think we're going to see a real compression." Young said it looks as though the economy is going to resemble the 1970s in the next few years. "Passive money sitting in indexes is not going to make people money," he said. Young also spoke about the strength of the Canadian dollar , which is good for travellers but bad for the economy since we are a trade -based nation. He said the U.S. dollar is getting stronger in the short term because they are raising interest rates, but it appears it will weaken in the long term. This could lead to prob- lems since the U.S. is the world's major buyer. "Everyone is selling to the U.S. but the U.S. does- n't have the money to buy because they're not sell- ing," he said. He added 70 per cent of the world's savings go to finance America's $8 tril- lion debt. With the U.S. dollar heading down, gold is going up and Young said it is better to be in on the gold market then out of it. However, he also cau- tioned against including gold as a big portion of a portfolio since it is a volatile market. Young predicted China will be the next economic superpower. Next on the agenda was Mery Erb who spoke to the group about what it will take to survive as a cash cropper in the future. "Everything looks real- ly, really bad," he said, adding the present situa- tion is like having a house fire and when the fire truck comes there isn't a hose to pump the water. "If hard times make us smarter then we should all be geniuses," he said. Erb went on to say that although he doesn't like the idea, the only way he sees cash croppers mak- ing it is to become like the big corporations who squeeze their suppliers and know their costs. "When you get out of bed in the morning, ask yourself 'who am I going to crap on today?" He said land is one of the major costs of the cash cropper and it needs to be brought under con- trol. Erb said farmers have become more efficient, but haven't seen a raise in pay for 25 years. "We're constantly pro- ducing without a real price increase," he said. Mike Ondrejicka of Ondrejicka Elevators said the bumper corn crop this year will be talked about for 50 years. He said the best hope for the 2005 season is to cash in on marketing opportunities for corn. He advised producers who will need cash within the next three months to go ahead and sell their crop. "If you don't have a cash flow problem, you may be rewarded if you hold it back," he said. Agronomist Dave Townsend spoke to the group about the 2004 growing season and the importance of genetics when it comes to planting a crop. 'By using the right genetics on the right fields, you will get results," he said. Townsend also demon- strated the role starch and water play in the maturity of corn. As the starch goes into the ker- nels, the water goes out and the ear reaches maturity. The amount of starch is Financial adviser Jeff Young discusses equity market research during a power point presentation at a grow- er's meeting at the Exeter Masonic Hall Dec. 17. Below, agronomist Dave Townsend demonstrates how water and starch levels affect corn maturity. (photos/Mary Simmons) affected by sunlight, frost, corn borer, drought, dis- ease and fertility. The evaporation of water is affected by sun- light, temperature, the thickness of the pericarp, the husk cover, ear orien- tation, humidity and starch type. He said roots equal yield and soy bean roots are dying when you most need them. "What you do to the roots is key with soy beans." He said August is the key month for soybeans while July is the key month for corn. He also pointed out that five to 10 bushels of crop can be lost within a seven-day drought peri- od. NK Seeds territory rep Eric Richter said although yield is important market- ing has a huge impact on the bottom line. "Take advantage of market opportunities," he said, adding a portfolio approach to planting is important. He said to avoid the "hot hybrid syndrome," opting instead for core hybrids which have a proven three to five year record. Neil Maclean of Farm for Profit said his organi- zation can help farmers with soil and compaction issues. "We can give soil a shot in the arm and reduce compaction," he said.