Canadian Farmer on Trudeau Resignation, Rising Land Prices, and Cattle Vaccine Shortages

Guest [00:00:00] Support for the Ag Tribes report comes from river.com, an online platform for buying Bitcoin in the United States. Use the affiliate link provided in the show notes to purchase Bitcoin directly from River to grow your Bitcoin investment and support the podcast river.com. Invest in Bitcoin with confidence and Legacy. Interviews, a video service that captures people as they really are, so the future knows who they really were. Here's Legacy Interviews guest Phil Bender on how the experience allowed him time for personal reflection and an opportunity to honor his parents.

Vance Crowe [00:00:37] What was the experience like of being interviewed

Guest [00:00:41] At this depth? Very rewarding, very refreshing. You know, you're just, your sense of interest and the depth of the questions was really impressive and you stayed present through the whole thing because I pay attention to that kind of thing. You were really, were walking with me through it. This is a keepsake for me, but also a great way to honor my parents. There are a couple things about my dad you drew out today that I don't know if, if I've said, said that to him. I think it's a moment in time to reflect, engage, deepen your perspective on what you've accomplished. I am reflecting on my version of what I saw, what I felt, how I responded to it. That is a legacy that's valuable. Welcome to the Ag Tribes report, a breakdown of the top stories affecting the culture of agriculture with your host, Vance Crowe. The report begins in 3, 2, 1. Let's begin.

Vance Crowe [00:01:53] Welcome to the Ag Tribes report. I'm your host, Vance Crowe. Each week I bring on a co-host that represents one of the many perspectives of ag and is a part of an ag tribe that collectively make up US and Canadian agriculture. This week with the resignation of Prime Minister Justin Trudeau, Canada, now operating rudderless, I had to have a Canadian on and I knew there were some characters that, you know, if you're a regular listener of the show that are Canadian. But I wanted to go out and find somebody that I didn't know what they thought. So I reached out to the Truth about Ag podcast and invited on half of their show. Mr. Christian Hebert of Hebert Grain Ventures and Maverick Ag Christian, welcome to the Ag Tribes report.

Guest [00:02:39] Hey, thanks for having me Vince.

Vance Crowe [00:02:41] So why don't we kick it off by asking you to tell us a little bit about yourself.

Guest [00:02:46] Yeah, I mean my, my 10-year-old daughter would probably just say I'm bald and try to be funny, but grew up in Mosman Saskatchewan, Fairlight Saskatchewan, which for American listeners is two hours straight north of Minot, North Dakota. Grew up on a small kind of family farm, typically, you know, went to school, ended up taking business farm wasn't big enough when I got home so I did my CPA, I'm currently a recovering accountant, is what is what I call myself. But came home farming full-time in about 2008. We were cropping, you know, 4,500 ish acres at that time. My, my dad had kind of started it on his own, farmed a bit with his dad, but more or less got it rolling on his own and, and yeah, so this year we'll crop 41 40 2000 acres and, and we started Maverick Ag, a consultanting company that works completely with producers, you know, government and and multinationals and kind of our pride of it is a, is a program called Farmer Coach, which is an education program for farms that kind of wanna turn their farm into way more of a business style than, than maybe a lifestyle.

Vance Crowe [00:03:49] Well Christian is being pretty modest here. If you don't know the truth about ag is pretty well known podcast up in Canada. They just had Ambassador Kip Tom on. Every time I see their clips it is of Christian spitting some truth that people don't often want to hear. I really enjoy it. So I'm glad you are on. Christian also spent some time last year in Dubai representing Canadian farmers with in for COP 28. So a very well accomplished, well recognized person. Alright, to this week on the AG tribes report, we are gonna cover Canadian farmers' reaction to Trudeau's resignation. We're gonna talk about expectations of Canadian land prices rising and what that will mean for profitability. Then we're gonna head down to the United States where we talk about the controversy surrounding the bangs vaccine and the mandatory RFID chips. There is some talk of shortages and this is causing some real problems. Plus we're gonna do the Bitcoin land price report. We're gonna hear Christians, Peter Thiel paradox and his worthy adversary and we're gonna try and do that in just 30 short minutes. While we jump into this, I wanted to mention that if you have a comment, you correct something that we've said, you want to jump in there with a question, go ahead and type it in on X, we will see that and it'll pop right in here. So let us know if you can help this discussion, otherwise let's get started. Okay, the first story, what do Canadian farmers think about Trudeau's resignation? Well, on January 6th, prime Minister Trudeau announced that he will be resigning from his position, but only after a new leader has been found for the liberal party.

Vance Crowe [00:05:28] The Canadians have this very weird system where he is both the prime minister and the head of the liberal party. Glacier Farm Media spoke with Keith Curry, the president of the Canadian Federation of Agriculture, who said many farm group and counterparts said they were expecting this and they don't think that the liberals choice of whoever they're gonna put in there is gonna change much for Canadian producers. But alternatively, the Canadian Laura Kennedy of the Canadian chicken farmers said the government has shown support for the chicken sector during her time in office and we're, they were grateful for the Prime minister and obviously the liberal government in terms of the support they've provided. Alright, so Christian, there seems to be some rather tepid statements from the public facing farm groups. What do your tribes think of of what's going on with Trudeau resigning?

Guest [00:06:21] Yeah, I think the majority of growers in Canada would say they were ecstatic when the announcement came out and approximately three minutes later when they found out there was gonna be three months of a leadership run and the government was gonna operate exactly the way it had for another 90 days, they were pissed off. Right. So it, it was in a, and it was an emotional rollercoaster for, for 90 for that whole, you know, the whole announcement of the whatever minutes he took. But you, I I think in general, producers are very excited. Keith put it right, this, this government really didn't have much time for agriculture. I mean, when I was at COP 28, to be honest, it never even got brought up from the Canadian tent and, and we had some of the best news releases you could for at a COP 28 conference, but it, it was just not a high priority for this government. And, and that was a problem for producers. Now, chicken farmers, so as you've noticed, and I'm sure we'll get into tr Donald Trump, he, he targeted dairy, lumber and, and automotive in his talk the other day, which is pretty specific, but dairy and chicken farmers are both supply management in Canada. So they were fairly heavily on, on government support and, and obviously that's where you see that comment coming up.

Vance Crowe [00:07:35] So everybody got to see Trump saying, well maybe Canada should become the 51st state. And that got a lot of reactions from people. But there's also, as Adam Les brings up, you know, the talk of the separatist movement, people wanting to break away from Canada up in places like Saskatchewan and Alberta. Quebec also has that is Trudeau's resignation, is that gonna change anything? Is that gonna make these movements, you know, more likely to happen? Less likely? What do you think?

Guest [00:08:03] Oh, I think that the next election will bring ca Canada a lot closer together than it has been in the past. There's some, you know, the, the overspending that I would say is happening around the world also was taking place in Canada. Right. I, I even, I think I'm even on tape once saying that a lot of bad ideas are, are brought up in the EU and then they jump on ships come across to Canada, down to St Lawrence and exit stage left in Ottawa. And, and we really did buy into a lot of the agenda that was coming out of the EU at the time. And I, and, and I think you could argue that the United States had too, some of it, right, maybe not as bad as Canada, but I think you'll see a lot more of, of the provinces coming together and, and working together 'cause it, we are proud of the country and, and to be honest, we're natural resource rich, which in this world is a pretty important thing right now.

Vance Crowe [00:08:49] What was everybody's take on becoming the 51st state? What do you, what's your read on that?

Guest [00:08:56] Well, if I was to give you my honest opinion, my daughter asked me and I said, if Donald Trump will convert everything at a Canadian dollar is equal to a US dollar and the fact my land would double in price overnight, it might not be that bad of an idea. But deep down, deep down, if you look at the trade deficit, if you take oil out, Canada's at like a $50 billion trade surplus with the US. I mean Donald, he always likes to leave out certain pieces. And, and the other thing is we make the US way richer. The majority of what we export is oil, wheat, canola, it's commodities lumber of which then you guys value add and sell around the world. So we we're actually good for your GDP. Now he's he's a master negotiator.

Vance Crowe [00:09:35] Yeah, I'm in total agreement with that. And I came out and said, look, what's good for Canada really ultimately long-term is good for the us which as you talk about, you know, the amount of dollars printed, this is coming from real agriculture farmers expect Canadian land prices to rise in 2025 despite their profitability concerns. Former guest and head of real agriculture, Sean Haney wrote the farm Credit Canada reported that farmland values rose 5.5% in the first half of 2024. But the annual increases over the past few years have been declining at, at a declining rate. Many farmers are concerned about profitability and the amount of farmers intending to buy or have potentially already purchased land in 2025 is 15%. For farmers that believe land prices will increase 44% see a 5% or less increase, while 47% predict a six to 10% increase. Christian, where would you fall on this survey? Are land prices going up? And if they are, by how much

Guest [00:10:39] I've been saying land couldn't go up much more for like a decade, right? It, it's just such a function of one interest rates which are currently dropping in Canada and two really where are people comfortable putting their money? And I mean, I think with the current volatility in the political environment, the stock market is, is scaring people. So specifically farmers if, and they've, there's been a pretty good run in Canada in the last two years have been dry, but I mean the last decades been pretty good. So a lot of these land price runs are, are by farmers. We have as a country, but specifically Saskatchewan, our land ownership rules are significantly tighter than in the US So the investors play a smaller role in land ownership up here. So a lot of the high prices are, are paid by farmers. I'm not saying investors aren't involved, but they're paid by farmers. So

Vance Crowe [00:11:24] That's really interesting. So what does that mean? It's harder to be an investor that doesn't actually farm the land.

Guest [00:11:30] So in Saskatchewan you have to be like base a 51 plus percent of the company has to be a Saskatchewan resident and then it then there's Canadian resident rules on top of that. So for instance, the endowment fund outta Harvard could not buy land in Saskatchewan. It's, it's impossible, right? And I just use the endowment fund outta Harvard as an example 'cause they own lots of land in the US but, and then the other provinces have their rules too. But it, it's, it's quite difficult for investors to participate if you're not at least a Canadian citizen. But then even Canadian citizens, it's difficult depending on what kind of fund they're operating.

Vance Crowe [00:12:07] And so how, how are commodity prices doing in Canada? Are you guys still getting hit as hard as you know, producers have been in the us?

Guest [00:12:14] Yeah, so I mean, one we're getting hit pretty hard compared to the last two or three years. Obviously commodity prices have been fantastic, but the one really good thing about having a bad prime minister and you guys being excited about our your economy is our dollars went from like 74 cents down to 69, 68 and a half and obviously the majority of our markets trade off yours. So if you take the wheat price and you divide it by 0.69, it's a lot better number than what American producers are looking at. So the, the exchange has been, the exchange helps us quite a bit on commodities. It is not so good for farm equipment.

Vance Crowe [00:12:48] Well, earlier this week I said on X that Bitcoin will one day demonetize farmland, meaning that it, it might help bring the price down to its utility value, whatever it can produce. And man I kicked a hornet's nest on that. What do you think you, you said you were surprised land prices keep going up. Do you think they go up forever? You think they go back down When at what time do land prices become the price of what the land can produce?

Guest [00:13:13] Well I've learned a long time ago that the two most dangerous words in our language are never and always. So there was times in the eighties, I know my dad has a quarter that he bought in 1982 ish that didn't get back to what he paid for it till about 2008, right? So there is volatility in the land market. I think the way the world operates right now when it comes to currency and the printing of money, it, it's gonna be a little different to see super, super high interest rates, which then keeps land prices Reasonable land is a finite unit. So I'm not sure I fully agree with you that I think Bitcoin will demonetize it. I think, I think Bitcoin might have to take out the s and p in gold before it starts attacking farmland. But I, I don't disagree with some of your philosophy either.

Vance Crowe [00:13:55] Well maybe we will come back to that. We're gonna go on to the third headline, which is the bangs vaccine forcing RFID chip issue with cattle ranchers. So this has been a long running issue, whatever it is, my world of of X always shows me what's going on with RFID chips. And yesterday cattle rancher, Kathy Fortune, out of the Badlands of South Dakota went on X to complain that her cattle vet couldn't deliver the critical bangs vaccine instead putting her on a wait list. Not because they didn't have the vaccine, but because they didn't have enough EID chips. Veterinarians are now required to put these EID chips into cattle when vaccinating and not enough tags means they have to wait to vaccinate. So the bangs vaccine also known as barus, I, I tried to say this about four times, I hope I got that right. Otherwise, Adam Jones is gonna gimme a hard time, which is used in cattle to protect against a contagious bacterial disease can cause abortion in pregnant cows, infertility and other reproductive issues. So when Kathy brought this up, ranchers across X took to the platform. Some of them telling, Hey Kathy, in light of the the tag shortage, you could just use an older ear tag. If you're not moving the cattle across state lines, it won't be a big deal. Otherwise other people were saying no, it's not the, the RFID chips that we have shortages of. We have plenty of those, we don't actually have the vaccine. So there are shortages of that. So it was all over the board.

Vance Crowe [00:15:26] The, I think though the best way for us to tackle this is I believe RFID chips are required up there in Canada. Christian, how much do you know about this and what do you think should US farm ranchers, you know, be waiting in line to get their vaccines in order to get that RFID chip put in?

Guest [00:15:44] Well, I think two pieces. So I, I grew up with cattle. We, we currently have all grain, but my brother has about, you know, 800 to a thousand cows and, and one of my good friends is one of the larger cattle guys in Canada and also operates in the US So I even touch base with 'em this afternoon. But you know, I, I think when it comes to cattle, pigs, chickens, et cetera, we would all agree that one of the biggest issues is, is health concerns and biosecurity. And in order to lock that down extremely quickly to be good for the whole country, I, I would argue that RFID is probably the way they have to go. And, and I think that's in general, now that it's been implemented in Canada, the feeling that most producers would say, you know, a vaccine being short. I mean, let's be honest, the one thing COVID really showed us is that our logistics and supply chain system has gone awful. Our countries are huge and they're hard to do that with. And then in this case, from the information I got, I mean the government's actually in charge of making sure there's enough of this vaccine for the vets to have access to. So I don't know if it's surprises you that the government would mismanage a supply chain of vaccines. It really surprises me.

Vance Crowe [00:16:47] Yeah, I mean and that's a a horrible thing. You got people that are trying to, to bring up the cattle herd. We all know this is a big problem. There aren't enough heifers out there, those that are pregnant if they get barus and, and abort, this is a terrible thing for the overall cattle herd. To be low on vaccines seems absolutely ridiculous. And I mean, I think you're right. If it's the government being involved in it, that's a pretty big deal. I think for Kathy, it was an interesting thing to say, you know, the vets are not putting out the vaccines. You're gonna go on a wait list until you can get that RFID chip in. And this is at the exact same time where a lot of cattle ranchers feel like this is a huge overstep that the government is forcing them to do this.

Guest [00:17:31] I mean, you're always gonna have the discussion of overstepping and what's right for the bigger picture versus what's right for your operation. Right? And I mean it's no, than on our grain farm we talk that our kind of our biggest and our only risk is policy. I mean, weather doesn't bother me. I can manage for that. People we're pretty good at, but I think in the livestock industry, they have to have a pretty good long look at biosecurity. And I mean, I had, my dad had cattle when mad cow when BSC hit Canada. So he had fats that were worth, you know, a buck 10 to a buck 25 and the next day were worth 29 cents. And there, there really wasn't that good of insurance for that. And so to contain that and, and it, we it, it lasted so long because it took so long to find a way to contain it and find it. There wasn't that many infected animals, but everybody got affected by it. And so that, you know, that, that, that's my one worry is that biosecurity is a huge risk for livestock. And you know, I would say in today's world, sometimes we do fight back against good things 'cause we get a little conspiracy theorist theory out, right? But in this case, if, if I'm a livestock guy, biosecurity scares me, like really scares me. And so what are the best ways to control it? And and like I said, I, I watched the financial, I was, I was a CPA at the time. I watched the cattle industry and cattle balance sheet just get decimated in Canada when it hit.

Vance Crowe [00:18:48] Well I've heard both sides of this argument. You're the first one that's been able to say firsthand, I've seen what can happen if you don't have it. So I'm I'm glad you brought that up, Christian. All right, that is gonna do it for the news section of the Ag tribes report. If you have news you think we should cover, go ahead and send it to me on x. I got some great stories this week. Any last words before we leave the news?

Guest [00:19:10] No, I think, I think it's gonna be more like a movie than news for the next nine to 12 months between our two countries. So it should be entertaining.

Vance Crowe [00:19:18] Alright, now onto the Bitcoin land price report. Christian, I'm not sure, do you guys have counties up there? Is it appropriate for me to ask how much does a land of or an acre of good land in your county cost?

Guest [00:19:31] Yeah, so our we rural municipalities are what make up the province and I mean it's probably the same as every county down there. It's huge varis from one side of a municipality to the other or even within municipalities. So I think I told you that, you know, I bought a bunch last winter for $2,850 in a seated acre and I've seen stuff trade anywhere between twenty five hundred and thirty five hundred in the last six months.

Vance Crowe [00:19:56] Alright, so we'll go with 3,500 Canadian. So last week the Bitcoin price was $96,971. And today, as of press time, we are all the way down to the fire sale price of 92,300, which means that it has dropped off 4.8% just in the last week. But if we were to convert the $3,500 Canadian per acre, that's $2,432 in US dollars that actually translates into 0.026 Bitcoin. So in other words, one Bitcoin would buy you 38.46 acres of farmland up where Christian is from Christian, how does that sit with you?

Guest [00:20:44] Well, there's always, you gotta always benchmark against something. So it's always, it's always interesting to hear, I don't think my land went down 4.7 or 8% this week, but it also didn't go up what it, what Bitcoin did this year either.

Vance Crowe [00:20:57] So where are you at on Bitcoin? Where do you think this fits in the world of, you mentioned you don't think it's gonna demonetize farmland. Where do you think it it fits?

Guest [00:21:06] Yes, so I mean, fundamentally do I think Bitcoin becomes, can become something significant? I mean we went from trading cows to trading gold coins to trading a piece of paper because the government said the piece of paper painted green was important. So I mean, let's be honest, that's all it actually takes to empower Bitcoin as governments to say that it's a valuable currency. And and you're starting to see a bit of that already, right? The US has even stockpiled it, whether they stockpiled or just confiscated it, I guess would be the question. But the, the more and more governments that say that it's a viable currency, it does the same thing as a, as a dollar and the benefit is it can't be printed right there. There's a finite amount. So there's a benefit to that for me personally, I mean because it's a finite amount, I think there's a unique circumstance for it, for it to be an investment that's every bit as good as land and, and probably has a shot at replacing gold and the s and p to be honest.

Vance Crowe [00:22:01] Wow, that is not a perspective I hear in agriculture very often. How did you come to that conclusion?

Guest [00:22:08] Well, I mean I like finite resources. Obviously. My wife says I'm not addicted to land, I just want to buy everything that touches every quarter that I have, right? And I, I guess the, the one big issue that we spend a lot of time on in our operation is access to capital. I think, I think agriculture as a whole does a really bad job of it, right? They, how they manage their money, how they manage their cash, how they deal with their financing. And obviously I explained some of the land ownership rules in Canada and how there's quite a bit tighter than down in the US And then on top of that, like our, we have oligopolies or monopolies for banks, right? There's only five or six banks in Canada, right? So there's not a lot of fighting for our business either. So on top of that we get pretty stringent rules. So I'm always looking for ways that I think capital could be freed up. And you know, I I have a bit of a conspiracy theory that if Bitcoin becomes front and center or, or accepted that it's a real easy way to, to access capital to buy more land and to use the two of them as a hedge, we'll find you and I'll relist to this in 10 years and find out whether I was really right and you were really right or whether we were going down the wrong path.

Vance Crowe [00:23:12] It does seem uniquely capable of being able to be collateral that is, you know, really liquid for, for a bank. You know, if you put up your house, the the bank doesn't want that house. They, they, because if they get it and they have to then turn around and sell it. And I know from having sat on a bank board and, and being a part of having to, you know, call in a, if somebody's collateral isn't that good, it makes you really reluctant. But if they had really good collateral that was as liquid as Bitcoin, all of a sudden you'd be like, all right, we'd be willing to take more of a risk 'cause we know we can turn this into money right away.

Guest [00:23:48] So I mean, you think about it, if, if a farmer invested heavily in farmland and in Bitcoin, the two, you know, once it's accepted and can be used as collateral and as liquid, the two things is you can borrow against those two things. So you can have an investment that you hope is going up in price, but at the same time you can go borrow against it to have op opportunity to utilize that cash within your operation, right? And, and so I think, like I said, cash you can, you can have as much equity as you want. And that's the big thing in agriculture. Very few farms are technically bankrupt. They have huge amounts of equity, they're just cash flow done, they have no cash left. And so those assets like land or like Bitcoin that you can borrow against, give access to capital and that's what makes the engine of the farm itself, you know, burn. And so I think the, the big thing we do is farms are two businesses, right? There's a real estate business and there's an operational business and they need to be treated like that. And then our argument is we actually take profits and we have a, we've started a family office that we invest outside of those two things and arguably Bitcoin might end up being a pretty big strategy of that third arm.

Vance Crowe [00:24:52] Well I am so glad you brought that up in the way that you did. I think when I came out and said that Bitcoin could demonetize farmland, it makes it seem very adversarial. But in truth, I believe it is something that farmers could be getting on faster, getting on early. And I do still think it's early and having that be a huge benefit to your overall operation. So I'm glad you brought that up in the way you did. If you've been thinking about Bitcoin, I have, I have a, an affiliate link with the company River. This is where I personally buy my own Bitcoin. It has been an excellent company and if you set up a a reoccurring buy, they get rid of all the fees, which is incredible. It means you can pretty much just buy for the strike price. Okay, now we are moving on to the Peter Teal paradox. This is where I'm gonna ask Christian, what is one thing that you believe that almost everybody in your tribe disagrees with you on?

Guest [00:25:46] Yeah, I mean I probably have two or three things, but I think the one, the one that probably creates some good discussion is I think consolidation in primary agriculture is a good thing.

Vance Crowe [00:25:57] Oh, and I have my, oh here we go.

Guest [00:25:59] I have my reasons for that. But I've heard you talk a fair bit so we could probably banter back and forth about it.

Vance Crowe [00:26:05] Yeah, tell me more. Tell me all about it. What do you think is the make the case?

Guest [00:26:09] So it f first of all, I'll go back to how I think governments kind of screw the industry with the utilization of stats. So, and Kip and I talked about this in a podcast not that long ago. Canada and the US are not much different. So they have a very low bar on what they deem a farmer. I think in Canada it's about 10,000 gross. I think Kip told me in the US it's actually as low as a thousand dollars of gross revenue, a farm revenue. So then when the government uses those stats where they wanna say, use the sustainability argument, how many farmers soil test, how many farmers do this? They'd use it by the farm, not by the acre. To show that as an industry we're not up to snuff, but the argument is by the acre we're really up to snuff. The problem is, is that most businesses, I mean if you searched it on Google, they probably say have a seven to 8% profit margin. We'd argue good ones want 15 to 25. So you need a million dollars of revenue to be something more than a hobby or a part-time job. It, I don't care how big you are if you're big acres or if you're a niche berry farm outside LA and you can sell it for way too much money. It's more about how many dollars of revenue and what is your profit margin that I kind of consider as consolidated in a farm because then you take profits and you reinvest it to make your farm better in innovation, in people, in more land, in Bitcoin, I don't care what it's, if your farm's just a part-time job or a hobby, like you're just worried about feeding your family. And I'm not saying that's not important, it's just not what agriculture is gonna be in 10 or 20 years. So that's why, you know, I think consolidation as farms have more and more revenue, more and more profit, they almost have to because we've let consolidation happen with everything above us.

Guest [00:27:42] Banks are consolidating, fertilizer companies have consolidated grain companies have consolidated accounting firms have consolidated. And if we're just small farms, we can't negotiate with them at all. But at the same time, I actually think it, it empowers the niche guys that are smaller because I, like I said, I know some niche guys that are phenomenal at what they do. I'm, I'm not a big organic supporter and yet one of the best financial statements I've ever seen was a, was a Turkey farm that had organic and rotated between alfalfa commodity and, and organic ground. And he, he made more money per acre than I've ever seen in my life. Right? But it, it allow, it empowers those guys 'cause they're not getting compared to hobby and part-time farms. And I, and I'm not taking anything against hobby and part-time farms.

Vance Crowe [00:28:24] So is ultimately your argument though, based on this idea of like, the numbers don't look right when we're counting because you're not really making the case that you think that these small time farmers are hurting you, it's just that the way that the acres are counted don't, don't look right. Is that correct? Is that a fair assessment?

Guest [00:28:47] 50 50? Yep. Yep. So that I, so a hundred percent on the numbers, it creates bad policy when it goes to small guys. They, they fall into two categories, really good niche, small, small guys or, or to be honest farmers that just don't like people and wanna do it all themselves, right? And, and they do a great job and make lots of profit. The the group of small ones that I struggle with are the ones that take 50 years to go bankrupt 'cause their grand grandpa was rich. So what I mean by that is, is when I was an accountant I'd, I'd sit with my clients and let's say they made $250,000 and land rent was a hundred bucks an acre and they owned, they owned 2,500 acres. They actually didn't make any money farming, they didn't pay themselves any land rent. Their grandpa left them all the money. So they were living on land rent. And so I would say to the operator when, because I'd say, you know, you maybe have a little too much equipment or maybe you should pick up some more acres. No, I don't wanna change. So I'd just say to his wife, why don't you just rent all the land out and go live in Hawaii and not work at all? You make the exact same amount of money. So it's, it's, it's the under utilization of capital that I, that I struggle with, especially when North America's getting thrown under the bus on that we need to be more productive. There's a lot of capital that gets underutilized in all areas.

Vance Crowe [00:30:00] Well this is a fascinating argument that you're coming from. I would say that so much of the reason that we have consolidation in all the things you were talking about, the the big biotech companies, the banks, all these groups is because as more and more regulation gets put on you, the only way that you can survive is just these giant economies of scale. You know, you gotta have your entire department that can fill out all the paperwork and you know, be ready for the audit and all of that nonsense. And I think the more and more that we get rid of that, then the more competitors you'll see in those spaces, particularly in places like banking and seed production. And then you can start having, you know, then the fractionalization, the decentralization is, is more powerful. Thoughts on that?

Guest [00:30:46] Yeah, so I a hundred percent agree with regulation. I mean it's part of why farms are getting bigger, right? You to have your own CFO and your own mechanic and your own agronomist is easier than wearing 50 hats all yourself, right? I'm, I'm not great at changing bearings, my mechanic's really good at it, right? So I guess my argument or my discussion back would be, I think there's a size where I said like, I'm not that good of a mechanic and I think I have to pay the dealerships too much. So I have a mechanic and I have a project manager and I have a CFO and I specifically grew to that size so I could have those people, they're be, they're way better at it than I am. And I think people are an investment. The other part of it was, I don't ever wanna be held ransom by my team. So if if, if it's you and one person and one person quits, your workload just doubled. If you have 20 people and one quits, life goes on, right? And and the third piece was if my kids don't wanna farm, I want my farm to operate forever and just pay dividends to the, to the, to the family forever. And I, and at a small size I couldn't do that. So now at, at 500,000 or a million or 3 million acres like some of these farms that you see in the acre groups in Brazil, 'cause that same argument holds hold true or are you right? I I might have a harder time arguing that.

Vance Crowe [00:31:57] Well I, I'm, I'm like, I strongly disagree with consolidation as a fundamental idea, but I gotta give it to you. You had a great Peter Teel paradox. I'm gonna give you an eight six that is a really strong showing on here. So now moving on to the last section, this is where we talk about the worthy adversary. So Christian, who is one person that you respect but strongly disagree with.

Guest [00:32:24] I thought about this one. So I I'm gonna give you credit, this is one of the better questions I've ever been asked and I do a few podcasts. I I had a hard time with it and I I couldn't narrow it down to one person. So I narrowed it down to, to two specific companies and you can tell me which one you want to talk about. So I, I said John Deere and Canadian Banks,

Vance Crowe [00:32:45] You decide That's fine with me.

Guest [00:32:48] Yeah. So I mean I, I'll, I mean I'll use Deere 'cause you can search my name and I'm in a bunch of Deere ads too 'cause I've done a lot with them. We run all John Deere equipment. I'm a huge fan of my operation center. What I struggle with is where corporate almost starts imposing their own regulation. So when I was an accountant, I, I think that all dealerships specifically Deere, get really worried about market share and, and force the wrong purchases or sell the wrong purchases to farms and equipment can equipment debt can cripple operations. And so I I don't believe there's a right size or doing the right thing for your customer a lot of time. It's just a new thing, right? I I don't believe in right to repair. Like I think as farmers we should be able to fix more and if and if it's too technologically advanced, that's fine Then, then tell me how I can send my mechanic to get trained to be able to do it right. And, and I'm I'm violently against per acre subscription fees. 'cause I believe, you know, our farm does a lot of work. We take pride in being around like a business. We're a lot less work than, you know, some smaller farms that would pay way less than us. So this theory of, of per acre subscription fees in the world of ag tech, in the world of equipment, it really, really frustrates me.

Vance Crowe [00:34:01] I'm totally with you. I I agree. I see your point of view and frankly I think this so many roads lead back to inflation is I think the reason these companies have become, you know, John Deere in and of itself is its own bank. It's its own financial institution. This is the same thing with e every car dealership, all these companies, you know, you go to buy software from Adobe and you can only rent it, right? Yeah. It's because at the end of the day, they can't make money producing a product. It is just too damn expensive because the inputs keep going up, the price of labor keeps going up. And so they're like, ah, well the way that we will do it is we will enslave people to this, enslaved is probably not the right word. We're we're gonna just suck 'em into our walled garden and it'll be so hard for them to leave that they can't. And then that is what we we'll produce. And so for me, all this bullshit these companies are doing is as a result of it's the only way to make money in an ever increasing inflated economy.

Guest [00:34:58] Yeah. Like, and like I said, I I highly respect Deere. We run all green stuff. My John Deere's the number one used app on our phone. We're heavy on data. I gotta joke that I want to turn farming into blackjack and I need to know the odds of every situation, right? So I mean we rely on it heavily, but at the same time it, it just frustrates me. But I mean your your points were all good. So I mean, let's be honest, I should be more pissed at government than I even should at the big companies. 'cause in most cases, red tape and regulation create inflation, right? Government spending creates inflation and, and what, what do private companies do? They find a way to survive and farmers don't really have a way to negotiate. So we have to take it.

Vance Crowe [00:35:37] Yeah, it's this constant in acidification of everything where like you start off making a great product, but then you can't make money just delivering that. You could in a world where your money was stable, you could continue to just, Hey, I'm gonna produce a product that I don't have to hope goes away after two years and somebody buys another one. You could make a really high quality thing because the money that people are exchanging for it, you don't have to put to risk. You could, you could be far more conscientious about it. So

Guest [00:36:04] I have the same, I have the same, you know, discussion around sustainability. It was why I was at COP 28, I mean specifically Western Canada, we've been, we've been zero till since like the early nineties, late eighties. And it's the number one thing on the regenerative checklist, right? So I'll, I always tell governments I'll believe in sustainability when you start writing me a check for doing something. Right? Right. We, we've been doing it for 30 years and they won't because guess what? Consumers want more but they don't wanna pay anymore. Right? They, when, when it was the one thing that we, I don't know what you guys saw in your grocery stores, but anything really expensive in COVID in the grocery store was still on the shelf. Right? All the premium products didn't get bought. Everything that, that you could conserve budget got bought. And so it, it's scary but follow the money, follow where consumers spend their money and and follow where companies spend their money and sometimes you gotta pay attention even if you disagree with what they're doing.

Vance Crowe [00:36:54] Yeah. And the wildest thing is even though people are paying at the grocery store more money for things like milk and eggs, it's not just that the farmer isn't making money, nobody is the guy at the grocery store. Now I know you guys up in Canada, Loblaw's got caught, you know, putting water in their, in their meat or doing whatever. But like on the whole, everyone is having their pocket picked, but it's by the government that's giving us attacks that we can't fight against. Or I can speak for the US I think the same thing is happening in Canada.

Guest [00:37:24] Well I mean that was, to be honest, so CO in Dubai was interesting there, there was some some great stuff and some of the most hypocritical stuff I've ever seen. But talking to some of the locals was some of the most interesting parts. And there's a bunch of stuff I don't agree with in the UAE but like this idea of like no tax let entrepreneurism thrive. Let's, let's build banks and tourism. 'cause if we control the world's money, we're pretty important. Oh. So sell all your natural resources to create a financial and tourism based economy and be really rich and then people pay attention to you. I don't, I don't know two countries do the US and Canada have much for natural resources? No. Yeah, we have lots and then we have horrible taxation it like it's backwards.

Vance Crowe [00:38:07] All right, well you have talked me into going way over the time, but that is because I have absolutely loved this. So if people have been listening to what you're saying and they're thinking, man, I'd like to get some more of this Christian Guy. Tell 'em a little bit about where they can find your show. Tell 'em a little bit about the show.

Guest [00:38:24] Yeah, so we have the, you know, the truth about Ag podcast, it's on all your normal Apple, Spotify, YouTube, my Twitter handle is at Christian Hebert and I tend to share it all, but Twitter and, and LinkedIn would be where, where I'm the most active. But you know, the other companies are kind of active on, on all social media. Hebert Grain Ventures is the Farm Maverick Ag is the consulting company and the truth about ag is, is the podcast.

Vance Crowe [00:38:48] Well thank you so much for coming on Christian. I also wanna thank the sponsors of the show. River is actually not a sponsor. I used them and found out that I could actually hook my listeners up with it. So in the show notes I will include a link if you would like to buy Bitcoin that will both allow you to buy from a great company and it will support the show. And also Legacy Interviews. If you have ever wondered how can I make sure that grandma and Granddad's stories are captured so that my kids and my grandkids know where they came from. Then go to Legacy Interviews dot com to find out more. So I'm gonna leave it right there. Thank you so much Christian for coming on and we'll be back next week with another Ag Tribes report. And as always, feel free to disagree. Ah.