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 These annual trips to gather detailed on-the-ground information on
crops in the world's biggest grains producer have long been seen as
a way to glean market-moving details not found in commodity analyst
notes or government reports.
But now their popularity is booming as a chance for those usually
far from the field to develop relationships with growers themselves
and to earn mud-on-the-boots credibility with clients and suppliers.
The Pro Farmer crop tour last month involved 120 people, double the
number a decade ago, from countries spanning Switzerland to
Argentina, who travelled roughly 1,500 miles (2,500 km) across the
Midwest and waded into more than 1,300 fields.
Wal-Mart, known for its low prices, sent representatives for the
first time on this tour, after trying out a wheat trip two years
ago. It has a rising interest in food supplies, having grown its
grocery business from around 7 percent a decade ago to over 70
percent of sales now.
"We are always looking for ways to better understand our business.
We attend farm tours to learn about crops so we can make smart
buying decisions in our efforts to pass on savings to our
customers," said Tim Robinson, Wal-Mart's director of dry grocery,
who traveled from Ohio to Minnesota with the tour.
After scouting a corn field in Ford County, Illinois, a roadside
encounter with a farmer gave Robinson just such knowledge. The
farmer said his crop, slated for delivery to snacks maker Frito-Lay,
whose products pack Wal-Mart store shelves, was by far his best
ever.
That revelation echoed what Robinson had encountered all week:
massive corn yields that have reduced grain costs for his suppliers
to the lowest in years.
Target Corp, which has also expanded grocery in recent years,
declined to comment when asked if it would attend in future.
Supervalu Inc, whose chains include Cub and Save-A-Lot, also did not
attend but a spokesman said it regularly meets growers.
Other new volunteers include analysts and traders a few states away
to as far afield as Britain or Thailand who feel they get
information which gives them an edge over competitors.
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"You can only really understand a market by getting dirty and in ags
that means you go get out and about and literally get mud on your
boots," said Fiona Boal, a London-based analyst with asset manager
Hermes on her third tour.
She called back farmers she met on the tour to confirm that soybean
growth had exploded after the rain-soaked excursion. "That sort of
anecdotal information from informed on-the-ground sources is
invaluable to an investor," she said.
Insights gleaned from the tour encouraged first-year participant
Angie Maguire, a trader and elevator manager in Charlotte, Michigan,
to lock in first quarter 2015 corn sales to a commercial buyer,
confident that prices were likely to drop.
"Some other folks may not step up and be willing to put sale on but
I feel comfortable after seeing the crop," she said.
The tours are not without critics, however, who say they focus on
incomplete information that trickles out via phone, email and social
media.
Data from other tours, such as those hosted by Lanworth, a division
of Thomson Reuters, or by forecaster MDA Weather Services, tends not
to emerge until the end as they draw smaller crowds and information
is shared with a limited client base.
Corn and soybean futures each fell more than 1 percent during the
Pro Farmer tour.
"My take on yield surveys. The more information that's known about
our crops the less we receive for them," tweeted Tom Burnham, an
Arkansas farmer who has never participated.
(Additional reporting by Michael Hirtzer; Editing by Marguerita
Choy)
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