Joint Ventures Easier Without Land Ownership

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Separating land ownership from your farming business is also good for managing your farm business and also makes it easier to develop joint ventures with other farmers or businesses, says Merle Good, a farm business specialist with Alberta Agriculture.

Good himself has been part of a joint venture with two fellow timothy producers in his area. Each of them found it difficult to find good help for the busy times – mainly at baling. And, when it came to marketing, none of them had the quantity of hay needed to interest buyers.

They worked out a way to work together and allow for the differences in their operations.

“We just harvest our hay together,” says Good. “Each of us owns our own equipment and charges custom rates for work we do as part of the joint venture. We market our crop as a single seller and each of us receives our share of the pooled price.

The big benefit is that by pooling our crop, we have more volume and that means more pull with hay buyers. Also, we have our partners, owner-operators, working with us rather than hired help we had to babysit,” he says.

There are negatives though. The biggest, according to Good is “who owns the show?” It’s difficult for an independent farmer to accept decisions made by somebody else.

Communication is essential, says Good. If one partner provides hired help to run another’s machine, who pays them? It’s important to address issues like these early while they can be addressed with a positive attitude and good humour before the issue festers.

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