Welcome back to the War Against Weeds Podcast. I'm Joe Ikley, extension Weed Scientist at North Dakota State University. My co host today is Sarah Lancaster at Kansas State University. Sarah, what is going on in Kansas?
Just a beautiful fall day. We finally got some rain in the weeks coming
up, rain. Ah, we're, we're transitioning to the more
Thanks. Thanks for having me today. So like you solid stuff falling from the sky this week up here, at least at West, you know, one of our, one of our guests, is just south of me. Was shaking his head vigorously, no, but it's saw it out west, at least on on some pictures from our end, on stations this morning. But that's not why we're here. And we're not just here to talk weather, just because that's
what we do in agriculture. But so we have two guests on today, and we're going to basically discuss some some things around or details around the herbicide supply chain. And so for that, we got a couple of good guests on today. We're going to let them introduce themselves, who they work for and what they do. said, Jeremy Safranski, Senior Director of our product And so we're going to start with Jeremy Safranski. Jeremy, welcome.
portfolio, crop protection product line. I work for CHS, leading global agribusiness cooperative based in the United States. We're a diversified supply chain company within the energy, agronomy, grains and food segment business.
All right. Thank you. And our other guest today is Mike Bjertness. Mike, welcome to the podcast.
Thanks, Joe. Thanks for inviting me as well. My name is Mike Bjertness. I'm with CW Valley Co Op based inWolverton, Minnesota. We are a locally owned Co Op operating right along the border of North Dakota and Minnesota. And Minnesota in southeastern North Dakota and west central Minnesota. Strive to be a full service Co Op. We have agronomy, crop nutrition, grains, fuel. Try to be, try to be full service and offer all inputs needed for our our patrons,
All right! And yeah, so some of the reasons we wanted to have, kind of both of you guys on today is this whole supply chain thing was probably not in our daily, our daily lexicon, until, really 2020, or 2021, and then kind of came to a point then when we started having some issues, and that's we're not going to discuss the issues of that year here, but figured it'd be good to kind of go through what this looks like
on a daily or annual basis. And you two are both heavily involved in at least a piece of that, with different businesses and what you do at work.
One thing to note when it comes to similarities in our answers is that if you envision the product supply chain, maybe in four pieces, tech and manufacturing, manufacturing, distribution and logistics on Jeremy's side, or CHSs side, myself as a retailer, and then the end at the farm gate, the end user is the farmer. We're the middle two
connected sections. The conversation would be quite a bit different if we were talking between manufacturer and myself, a little bit different between Jeremy and maybe the end user. If, if we had varying levels of of varying degrees of of connection, we probably noticed different answers, but we work very closely with our supply chain, including CHS, they're very valuable supplier of ours, so I think we're pretty in tune.
Yeah, that's kind of the reason we had both these guys on at the same time as we we have episodes where we talk to the manufacturers and how does this product look? How do you try and position this product? And we, we just talked about research and development of products recently. And then
we have farmers on and kind of the decisions they make. So these, these two are we, we've had the conversations with the the other two groups involved, as Mike kind of divvied it in four different categories, and these are the conduit, the connectors. You know, how do we get from that discussion with manufacturers to trying to kill weeds? In our case. What I'm kind of thinking of how we'll kind of go through this today is maybe we'll start with what a typical calendar year looks like
on the distribution and retail side of things. Of maybe we'll just start, we're recording in early November, so you know what's happening right now and what does the next 12 months look like. And we'll start maybe Jeremy with distribution, what just what happens in your World.
well, with what's happening right now, there's a lot of ordering going on and forecasting modeling for what we're seeing with everything going on today. So we're making sure that we're trying to on the off patent side of things. We have to make sure that we get technical on vessels
before Chinese New Year happens. Chinese New Year this year in 2025 is January 29 that's about two weeks earlier than it was last year, and normally to have it shipped over to the United States, shipped inbound, told and produced in the United States, and basically shipped out to all of the retail facilities in time for use season. It would have to be shipped out before Chinese New Year. So that's what a lot of
our suppliers are in process of right now. And we're we're in that process right now of forecasting, making sure we're modeling, trying to get in front of everything ahead of time, to get in front of this market and see where we could see next year's crop being, and if we're seeing any shifts in markets and so forth.
Sarah, you looks like immediately, you had a follow up
Don't take me to Vegas, because I have no question. poker face (laughs) so well. First off, I was wondering about the Chinese New Year thing, but I assume that's just things kind of shut down for a while, and if you don't get it before, then you won't have it in time?
Yeah, so normally, Chinese New Year is a very big celebration in China. Of course, it's about a 14 day celebration. Everything is basically shut down there. So they shut down. They have that large celebration by the time they get back. When you talk about a 45 day lead time to put it on a vessel, ship it to the west coast or the East Coast, depending on where they're going. Get it shipped inbound to an inbound tolling facility within the United States. You
got to add another 45 plus days to ship inbound. Get it told, get it, you know, shipped to another retail facility that just normally get past that window of use season for us. So that's just normally a rule of thumb that we've used for quite some time.
What kind of things are you modeling and forecasting acres for different crops? What else?
Yeah, so we're definitely modeling acres for different crops. What that shift is, we're also modeling the different uses for the different over the top soybean treatments. With the loss of Dicamba over the top soybean treatments, we're going to look at what glufosinate and the potential increase side of glufosinate and enlist would be for that over the top treatment of soybeans. So that's going to be a big key player for that going forward. As well as last year wasn't as
big of a soybean pre as we were expecting. How big of a corn pre also did we have for, you know, during our corn fill timing, which would have been, you know, summer fill timing. So how much actually got filled in the tanks out in the country for bulk fill and, you know, basically reverse engineer that reverse engineer that backwards to see what we think we have left to come in. So
Sarah and I just get busy modeling what weeds are going to be an issue that's a whole another level that we don't have to think about.
Yeah, there's, there's going to be a pretty big, drastic change in what we're seeing. We're seeing the market with glufosinate alone. We saw two years ago be about 12 million gallons of total glufosinate usage. This last year, we're estimating that it got up to about 17 million gallons. And in 2025 our predictions are that it's going to be somewhere around 22 to 23 million gallons of glufosinate usage. So another 25 plus percent growth, especially with the loss of Dicamba usage.
Oh, it's going to be a lot of Product to Ship around and move and get out onto the field.
Yeah.
so, so Mike, what about on your end? So you know, this time of year, I'm you've kind of said you're full service Co Op, so I'm guessing you're wrapping up the year and starting to think about next year. But want to hear it from you.
They always kind of run together as we switch gears as seasons change. So we're wrapping up harvest. We're still doing fall fertility. The rain that we got recently is
freed up some of that sort a little more. But on the management side, we're going to mirror pretty closely to what Jeremy was talking about, except in in a little different realm, because we're trying to anticipate crop intentions for 2025 we have a pretty good handle on the weed pressure and what to expect, but we're also trying to meet farmers and develop preliminary agronomic plans and what products they
plan on using. So. Doing some forecasting there, and then going out and and procuring as we need to and and as it's advantageous. Obviously, keep in mind that it needs to be early enough that logistically we can get it in. But then there's some other factors there too, providing flexibility for, say, unknowns, pre plant or preventive plant, different
weather conditions and market changes. You know, every year we see some some acres, some swing acres, change march into April, even into May, depending on weather and commodity markets. So we have to anticipate a little bit of that, but taking a position early is usually advantageous for us, as long as we do it well.
and you're probably also working on some of the things that Jerry Jeremy had mentioned. Kind of how much of product X Do you still have in the tank? And do you need to order more, or do you need to find a way to get rid of that tank? I guess that's all part of the the equation right now.
It's a very dynamic process. So yeah, I've been looking at that quite a bit lately, between intentions, like I said, crop intentions, product use, intentions, and then forecasting. One thing that we haven't been forced to pay attention to so much until about COVID Right after COVID is the cost of money before now, you know, if there was a X percentage incentive to take in early that always outweighed our
cost to money, and now that's completely flipped. So we have to to make sure that it's, it's price advantageous, while, keeping an eye on market volatility and either appreciating or depreciating value and product that we have on the floor. So there's a whole nother level to it than there was pre 2020 and it puts all the more emphasis on on accurate forecasting and relationships with your suppliers.
Yeah, I know when I'm thinking about things like, well, we mentioned glufosinate once already, but just the price of that product in the last couple years, that's just that can't be fun for either of you guys the way that's kind of fluctuated over the past couple years and and just trying to forecast out and make sure that gets moved appropriately and ordered at the correct quantities.
It's a lot more fun as the price goes up than when it comes down when you have inventory.
So we mentioned, or couple times, something you know, along the lines of new products. And so since it's about what, 10 days ago now, we we finally heard we got a Liberty Ultra label. So that's what I'm just going to kind of pick on here, just because it's, it's new and and that's probably one you guys might both be trying to wrap your minds around how you want to deal with that product now as another well, it's glufosinate, end use product, I guess is one way to
phrase it. But you know, how does a new product like that play into some of these modelings and decisions at this time of the year? Maybe we'll work backwards with Mike and then up to Jeremy.
That's actually been a conversation that we've been having pretty intensely within our office lately and with some reps. So what changes that a little bit is the plethora of generic options on the market. I will argue that that branded Liberty is is by far superior because of the surfactant package, and we've had great luck with it. We fully
intend to maintain the branded option. But one thing that simplifies that is the manufacturer BASF, has opted to stop production of 280 so that does take one alternative out of the market or out of the mix. We don't have to decide between liberty, ultra liberty, 280 or some of the generics we know, especially like Jeremy mentioned, usage is going to continue going up. We expect more, especially on the enlist acre around our area. So we're trying to forecast and read the,
read the tea leaves, on, on, what's going to happen. But again, going back to those internal discussions, deciding which route we're going to take when it comes to a product, once we once, we decide that the rest of the pieces kind of fall into place, but we have to decipher our starting point.
And how about, how about you, Jeremy, how does that kind of play into what's going on?
Yean, to sort of compliment What, what Mike was saying on, on a few of those things we've been doing the research with, you know, Liberty Ultra as well, versus their old racemic formulation. And. So when you look at the two of
them, you know, comparable and stuff like that. For us in a distribution company, it, it is a huge savings with a with a lot of different instances, because when you go from a 32 ounce use rate to a 24 ounce use rate, you are going to save, you know, you know, packaging materials, repackaging and so forth going forward. So, you know, it saves our trucks there's less loads all of the above to be able to deliver in a shorter window, and we're getting into a shorter window now, because they did not
get the new label quite as early as they expected. So it did come in a little bit later. And now I'm looking at state registrations and so forth. And sometimes state registrations can dip into, you know, excess of six plus weeks. So we're looking into probably a q1 shipment time frame on liberty
Ultra with a lot of that. That's a lot of shipping to hand have in a short window of time, so anytime that you can reduce that from 32 ounces rate to a 24 ounce use rate and actually increase the efficacy of of that product, that's probably really good for the end user and the retailer and distribution channel and everybody along the way. So we look at that as as good news. But it does throw a little more wrench into our wrench, into the into the cogs for us, because we have to do
some conversion. Now, when we start looking at how much is BASF breaking in with imports on L-glufosinate versus, you know, the old formulation, and so forth. And, you know, with forecasting and so forth, you have to take that extra conversion into into a factor when you start looking at your forecasting, modeling and so forth. So,
so maybe, maybe along those lines, I think it might be interesting as you're we can pick on that product or another product. Doesn't matter, I guess. But as you're kind of looking at a product and and how you want to bring it in and chip it around to the different retail partners or warehouses, how do you figure out the breakdown of things like bulk tanks or mini bulks or cases?
Yeah. So, I mean, we go off of, you know, mainly historic numbers is what we we've used. We go off of previous year history and a five year average kind of on, on what's placed out there with bulk forces, tube buys and totes and repairs. So legitimately, what still makes up the majority of our business, and 50% of it is sold the two by two enhanced. It all reliable. You know, five gallon case, 50% of our business is in a five gallon case. That may shift in different areas.
You get into the Corn Belt, where it's very, very heavily predominant corn freeze that may shift more than where we're at in or get further into the trade territory, into the wheat market and sugar beets and so forth. It's, you know, for us, it's in that five gallon jug. But so that makes up about probably 50% of your business. Third of it is is bulk, and that ship direct, you know, it's round up, it glyphosate, soybean PREs and so
forth. And then the balance of what's left is, you know, mini bulks or totes and repack containers and any other size performed that would be selling. You would be selling a 30 or 30 gallon drum, 55 gallon drum, and so on.
and Mike, what about on your end?
I'm going to echo what Jeremy said. I really comb through historical sales data thing, primarily on the prior one to the past five. You know, obviously different products with different use rates dictate what size. So if we look at the acre treated, we can start making decisions on
package package sizes. And it's, it's a geographical decision too, because even within our trade area, trade territory, we can see, say, on the eastern end, guys are going to be using higher rates of corn rather than some of their their sugar beet herbicides. You know, we're selling nortron In 250 gallon cages to some guys where others, just a few boxes will suffice. So looking geographically and then based on historical sales data, that's how we how we determine our our package size,
mix. And usually we get pretty, pretty close. But I do like when guys top up on on two and a halfs To make sure the bulk tanks are empty.
So you were asking about package sizes, and that made me think about formulation types. And I kind of went back to when I was teaching undergrad Weed Science in a past life and talking about the benefits of different type of like liquid formulations versus dry formulations. And students are always like, Well, why don't we package more stuff in dry
formulations? And I guess I was just curious to let you guys talk about those differences and formulations and how you view them, and you know, just liquids versus dries in terms of handling and your preferences and that kind of thing. Does that make sense?
I think so. May want to start with Mike on that one, since while they may be driven by the end user in their preference,
it's absolutely driven by the end user their preference and their capabilities of mixing what their equipment dictates. Having cut my teeth in a sprayer and water truck, I can tell you that I don't look incredibly favor favorably upon a lot of dry formulations when it comes to easy use, pre formulated liquids are always preferable. In fact, you know, years ago, I was hearing about a dry formulation
of glyphosate. And how it was going to transform our our warehouses, instead of bulk tanks, we were gonna have 50 pound bags that would do some so much more that never came to fruition. And I really think as as we progress, it seems like more things are, are progressing to a liquid formulation and and it's it's end user, and its usability. Dry formulations just are not as easy as as liquids in any way, shape or form.
Yeah, I know, especially in gonna be similar in many areas. But our geography, I think we're getting groundwater in June. It's still in the 30 to 40 degree range, and so getting those dries to dissolve is a major time issue for us. With some of our cold water we're pulling out of the ground.
a hot water heater in a water truck is nothing anybody wants,
even those those on demand heaters, they it's a much smaller hose size than what we want to be pumping into a sprayer. So, Jeremy, what about from your end? There's, there's formulation type of questions,
yeah, so, I mean, it's very similar to Mike's, Mike's opinion it, it is all dictated from the end user. And if you know they're having mixing capabilities and so forth
in their sprayers. That all comes back up to us, and it does seem like no matter how we look at it, liquid formulations, when your handling it around in your warehouses, they're just they handle better, they sit better on a pellet, a 50 pound bag doesn't, you know, a box of a five gallon box doesn't slide off, as good as a 50 pound bag slides off, and then it slides
off, and then it rips on the corner. And then you have, you drag it halfway across your warehouse, and you have to have somebody sweep it up and dispose of it properly with the right disposal procedures and so forth. So, you know, when you look at it from that point of view too, it just always does seem like the liquid formulation is easier handling and so forth,
with that as well, too. So yeah, to dictate and and basically comment the same way the end user, and it does seem like it's an easier handling facility, handling as well, too.
Feel like Sarah, you and I and our all of our weed science colleagues might be the ones who prefer dry, in many cases, just because we can over order and we know that stuff will store forever. Dry Atrazine is a lot easier to mix than what we're doing than resuspending a five year old jug. So some of the other questions I had here gonna switch gears a little bit. And and Sarah, maybe you have thought of a different example along the way, but so we have talked a bit about modeling and
going back on historical records. And so the one that I had brought up and posed to you guys, and the written questions was, was basically, I'm thinking about paraquat in North Dakota. For us, we're we're typically an August type of market. Uses it to desiccate our crops, and Sarah and I want to kill weeds. And so maybe one of these days, people will listen to us, and we'll shift in our geography to a burn spring burn down market. You know how? How would that play into the typical cadence of
how you guys are managing things? And maybe we'll start with Jeremy on this one, and then work back down to Mike.
Yeah. So there's probably two parts to that question. The first part would be number one is pair. Quite actually, in the country. So if paraquats in the country, and we can move it from down south to up north, and there's a little bit of that excess supply, or we have some safety stock and so forth that we can move to North Dakota from, let's just say Texas, for instance, because they have a pretty large burn down run in Texas of paraquat in the spring of the
year, and we can move it all the way up to North Dakota. Not that huge of a deal. You know, five to 10 days probably, you know, to put some wheels underneath it, get it all the way up north, put a few truckloads under it. And just definitely not a big deal. The second part of that question would be, if it's not in the country, so, and that's a that's a big deal. So if you're bringing in paraquat, and it's 45 days, if you're shipping it from, you know, China, India, wherever it's being the
technical is being produced, then it has to come over. Most paraquat is produced and basically sent over as a finished good there's a couple things they add to it when it gets over to the United States. So you're probably not tolling a huge amount into the United States, but there is still some added time frame that you're looking at there. But if there is technical into the United States, and you have to shift a
few things at a tolling facility that does take time. So then you're looking at two to three weeks to shift some tolling lines that are available at different tolling facilities, to shift products around. So I kind of answered that in a two part question, so I hope that kind of answers that.
I'm wondering if we should clarify for the listeners, when you say tolling facility. Jeremy, can you explain that a little on that?
Yeah, so I can clarify, for tolling facility, how we refer to that as it's, it's a facility that's, you know, basically, will publicly, will publicly manufacture technical into end goods for a specific company. So whatever company that is, they'll bring in technical product from comes in as technical product from China, India, Argentina, any of
those type of countries. They'll ship it in, bring it in. They'll mix it in batches the proper way that it needs to be mixed to put it into suspension, and it'll come out as end goods, and it'll have the perfect label in the tote, in the two by two and a half gallon jug and boxed on a pallet, and shows up at your doorstep through one of Mike's trucks or pick it up out of his warehouse, so.
And, yeah, so, Mike, what on your end? I mean, we can use paraquat or a different example. You've gone got this forecast and all of a sudden, you know, if you want to get, oh, we'll stick with Paraquat. You want to get it in May rather than August. You know, how does that kind of look in your world.
I called Jeremy. You know you Jeremy said it best, and he's going to have a much better handle on on the upstream processes that'll get that kind of quantity here. It's always something that we're cognizant of as larger volume products shift is the availability and the
availability in time. I think I'd be accurate in saying that there would probably be heartburn for one to two years if that were a trend line shifting that type of quantity to a different time period, but the market would resolve itself
pretty quick. So it's always something that that we keep in the back of our minds, options or possibilities that might happen throughout the season and and have some idea on how to handle that, or alternatives, but we rely on on the upstream distribution and manufacturing networks to help us through that.
So one commonality I'm hearing is something I always tell my students that even though, in our case, we're working with weeds or work with products, this is still a people business. Still have to have those connections to grease the gears and get things moving.
Very, very true. The Ag industry is very much a relationship driven industry, and I think the trials that we've gone through in the last four years accentuate that. So it's it's really in building those relationships and who you build them with and how you treat them,
yeah, making it through COVID In the last two years, or the two years of COVID that we had, I think, made us better as an industry, and understanding that we needed to be better communicators as an entire industry in depending upon one another back and forth. So that did help us through some of these things. From trying times, is how I word it. So
I guess, as we think about, you know, I think especially somebody like you, Mike, you guys, have to choose kind of what you're going to keep in inventory, who you're going to work with. How do you handle, you know, maybe customer preferences, or your own company, preferences for like branded pre mixed products versus buying off brand straight goods and kind of tank mixing things. How does that? How do those options influence your business? Does that make sense?
It does. And I think that's a two part question between pre mix and straight goods, and then branded and generic. And the way I would describe it, as it comes down to your business model, how you want to position yourself, how you want to present yourself as, as purely branded, purely generic, from a cost standpoint, or or a hybrid model of both,
and we've adopted a hybrid model of both. We still sell predominantly branded product because we find a lot of merit in the R and D through manufacturers, the support the backside, support the relationships, and in a lot of instances, those products are either not available in an off, Pat patent alternative, or quite a few instances, or they're competitive enough where we can position them correctly. I haven't looked lately at the breakdown between our branded
and generic as to exact percentages. And then you have to take into consideration, you know, are you looking at dollar volume or volume, physical volume? Because there is a differentiation there. But when it comes to that mix, I feel like we've fallen into a pretty good rhythm of what our customers are looking for, how we want to present ourselves as a company, and the target audience that we have. And then when it comes to the pre mix and straight goods, it really comes
down to the geographic fit to the pre mix. We've seen a handful of them out there that come out and they're presented as the next easiest option, but the ratios don't fit our geography well at all. They either either have way too high components of some or way too low of others, so we end up spiking some in there are there are a handful of very good options when it comes to pre mixes, but we're, we're
skeptical of them. We'll vet them pretty hard before we bring them in and and start selling full full speed, or, you know, full throttle on them.
Yeah Sarah You should know some of that I'm always the problem child when we do these multi state research trials, because like, Nope, can't use that pre mix up here.
Even here, like, I don't want to sound like I'm whining, but, like, a lot of things in the agronomy world are here for the I states, right? And so even Kansas, we're kind of the, you know, in some ways, fringe acres for corn and soybeans. And so a lot of times, yeah, our eaters, our weed spectrum is different, and so we just need something slightly different than what the the Iowa, Illinois folks are driving the market towards.
PH has come into play for us quite a bit when it comes to those pre mixes. You know, our average is between a 7.8 and an 8.1 pH. So it's completely different spectrum that we're working in compared to the I states.
It is an annual conversation I get to have during protocol season with companies when they want a nice, tidy national trial, the same five to 10 treatments. I'm like, your atrazine rate is three times what we even sniff at. And then I know that's kind of geared more towards Mike, but I don't know, Jeremy, if you had any kind of thoughts around that that question is that Sarah had posed.
yeah. So, I mean, it's, I would, you know, be very similar in Mike's response to it. A lot of it has to be, you know, vetted out, and it has to be geared towards your specific area. So, you know, I, I did run a facility up in northern, North Dakota for a while with CHS, and I always ran into some pre mix issues with a canola rotation. A lot of the pre mixes weren't designed for canola rotation, and so I had to, you know, look at that and do a lot of separation of that
to make sure that I could get back to a canola rotation. And I'm sure Mike's in the same situation with a with a sugar beet rotation, to get back to some of those pre mixes that that are out there. So they're good in a lot of ways, for ease of use and so forth, for the farmers. And that makes it easier for some of us as well to there's one single product. It's easy to ship. It's easy to get out the door. But again, right? You have to do what's agronomically right for your farmers as well. So.
All right, well, we are coming up close to the hour so and we kind of got through the list. So kind of what we do want to do is give you both kind of an opportunity, if we always, if you're on social media, want to plug yourself, we can provide links, or if you have a just the company website, just so people can kind of find out more information about the places that you work. And maybe we'll go ahead and start with Mike on this one.
Yeah, we're available on Facebook and also our website, cwvalley.com,
yeah. So you can find information on company, CHS at www.CHSinc.com, or you can find myself on LinkedIn if you search my name.
I'm on LinkedIn too. forgot that.
All right. And with that, we're going to wrap up this episode. Thank the listeners as always, and we'll catch you next time on the War against Weeds Podcast.
Thanks for listening to the war against weeds podcast. We appreciate your listening. We appreciate support from the north central IPM center, and we appreciate the collaboration with the Crop Protection Network. At crop protection network.org you can find the war against weeds podcast as well as other podcasts and a variety of other information related to crop protection. Thanks again for listening, and we hope to see you next time you.