Our Mission Revisited: Why Direct-Sales And Containerized-Deliveries?

With the release of our new portal last month, we turned a new leaf in PGP’s mission – our focus is now on reaching to grain-buyers in overseas markets. Many of our followers had the benefit of reading the articles we have been posting, almost 50 of them so far, but in the coming months we will shift to short blogs promoting grain exports. For the sake of our new followers from the Prairies as well as overseas, however, we are still going to post occasional short pieces on the nature of our mission, why and how we are trying to generate interest in direct-sales.

Canada has been known on the world stage as a primer source of grains for more than a century. We have been exporting grains all this time, now more than half of what we produce. But most end-users may not even recognize that they are processing grown-in-Canada grains, let alone know anything about the virtues of the Prairie grain-economy where they can buy a huge variety of high-quality crops directly from grain sources and get them delivered to their doorsteps in container-loads.

Our grain-industry has been stuck in a time-warp, consolidating near production-sources, what we call country-elevators, transporting by unit-trains to coastal-terminals, and shipping to end-markets in bulk-vessels. This in turn imposes the mirror-image at the receiving end, requiring coastal-terminals and multi-tier inland-distribution systems before the grains get into the hands of end-users – crushers, flour-millers, food-processors, bakery-chains, maltsters- brewers, etc.

Conventional wisdom is that bulk-systems are the most efficient and least costly way of moving grains, but this is a delusion. There are significant cost-savings to be had by bypassing the bulk-systems, thereby eliminating the need to consolidate at the production-end and distribution at the receiving end – savings that buyers and sellers can share through direct-sales channels and container-deliveries. What has been achieved in North American trades through corporate procurement practices can now be accomplished in overseas export-trades in containers.

This is our portal’s mission www.prairiegrainportal.com – facilitate direct-trades, help overseas buyers procure from multiple production-sources, make all the service-arrangements (clean, grade, test, etc.), provide logistics-support to containerize and ship grains to final destinations.

What’s in it for grain-producers? Prairie producers at large are happy with the outcome of trade-liberalization across North America. In a competitive environment, they get fair market value for their crops, including quality-premiums where they are warranted, while buyers are happy to be able to buy direct from producers, thereby reduce their costs by eliminating trade-intermediaries.

From what they sell into bulk-export channels, however, producers barely cover their costs. To begin with, our grain-exports through bulk-tenders do not yield value commensurate with high quality crops we grow and export. Producer-margins are further squeezed because they are captive to bulk-systems, with no option but sell to nearby grain-elevators, which are owned by a handful of grain-companies with too much market-power over them. Thus, producers are eager to sell direct to overseas buyers as long as they can avoid trade and logistics risks.

What’s in it for grain-buyers? We are the world’s 5th largest grain-exporter, but more than volume we stand out for the quality and variety of what we grow and export – not just different types of high-grade wheat and barley, historically our staple crops, but the new varieties we have added to our export portfolio, including canola, soybean, lentils, peas, and many other coarse-grains, oil-seeds, cereals, and pulse varieties. Also, if you need specialty crops or mixes (whether breakfast-cereals or animal-feed) we can help you source.

Canada stands out for grain classification-grading systems, arguably the most refined in the world. You can find exactly what you are looking for to achieve the end-use attributes you want – whether in wheat, barley, canola, soybean, or anything else. Moreover, we have the most reliable quality-assurance systems – sampled, tested, reported, and approved by you when the grains are loaded and sealed into containers. All the pieces are in place, with oversight and enforcement functions, including the most comprehensive identity-preservation regulations.

All you have to do is tell us what you need by crop type and grade, and the volumes you require at each of your locations. We in turn present you with procurement, servicing, and shipping plans with cost estimates and delivery schedules – you make the choices and decisions, but we are here to support you in all aspects of project execution and management.