Posted October 12, 2022 | By: Nutrien Ag Solutions
"The Future. Faster.": Episode 32
Growers build their legacy in the farming success they have today, but also the impact they leave for the future. But if an operation doesn't have the financial support it needs, that could affect its viability for future generations. So in this episode of the Future. Faster Podcast, we're talking to John Maman, sales and marketing director at Nutrien Financial. We'll discuss some of the financial tools Nutrien offers for supporting a grower's economic and operational sustainability, how these financing tools support Nutrien's broader ESG goals, and how to limit risk for growers in sustainable practice-specific farming operations. Plus, Tom and Sally discuss the recent devastation caused by Hurricane Ian in the state of Florida and throughout the American Southeast. They explore what crops and farming operations suffered the most, how the affects will ripple out across the agriculture industry, and what it means for sustainability practices.
Episode Transcript
John Maman:
One of the things that can't be a surprise is what you're doing with your money, and how you're carrying your terms. The market has so many other ways to surprise us, and we've seen that with the interest rate hikes. We've seen that with weather, and again, our customers are family people. They're tied to things outside of just the agronomic practices that can pop up at any given time. Our financing doesn't have to be one of those surprises, it has to be a complement to everything we're doing.
Dusty Weis:
Welcome to The Future. Faster. A sustainable agriculture podcast by Nutrien Ag Solutions with our very own Tom Daniel, director, North America Retail and Grower Sustainable Ag, and Dr. Sally Flis, senior manager, North America Sustainable Ag and Carbon. This is your opportunity to learn about the next horizon in sustainable agriculture for growers, for partners, for the planet. To us, it's not about changing what's always worked, it's about continuing to do the little things that make a big impact.
Dusty Weis:
On this week's episode, we're joined by John Maman, sales and marketing director at Nutrien Financial to talk about economic sustainability on the farm. Growers build their legacy in the farming operations they leave for the future and we'll discuss ways to make sure your operation has the support it needs to stay viable for generations to come. But if you haven't yet, make sure you're subscribed to this podcast in your favorite app. Also, make sure you follow Nutrien Ag Solutions on Facebook and Instagram.
Dusty Weis:
I'm Dusty Weis along with Tom Daniel and Sally Flis. Tom and Sally, in agriculture, we talk a lot about best practices and sustainability and all that, and you control what you can control, but you can do everything absolutely perfect, and sometimes you still just catch a string of bad luck. There's no more extreme example of that going on right now in North America than what's happening in Southwest Florida with the landfall of Hurricane Ian in the Fort Myers Area. I've got people down there and I know that you guys do, too, and so first and foremost, we send our hearts out to those folks and everything that they're going to go through over the next couple of months rebuilding and all that. But I understand as well, Tom, that Nutrien Ag Solutions as a company actually sat down and took a really important step in its response to that hurricane in Southwest Florida.
Tom Daniel:
Absolutely, Dusty. In fact, I was telling Sally earlier today, I was in a budget meeting with a lot of the leadership for the North American team and we stopped that meeting just so that we could all take a moment and report on the condition of all the employees that had been accounted for in Florida, and all of them were accounted for, the conditions of their homes, and their families to make sure they were safe, and we went back, of course, and they were giving information on our retail facilities, and those type things. I was very pleased to work for a company. We talk about having a culture of care around Nutrien Ag Solutions, but it's real when we would take the time to stop a meeting just to report on our employees and making sure everybody knew they were safe. Sally, that was a big step, and just to me, it just shows the true character of the company.
Sally Flis:
Yeah, it's great to see, Tom, because there was a lot of devastation down there, growers we work with, partners we have. There's some pretty big fertilizer production facilities right there from companies that we do business with, and they're having a lot harder time than we are, but looking at the reporting from down there, everything from honeybee hives to orange groves were impacted by this hurricane coming through. It's a long recovery when you look at what happened out there. Crops like oranges, even if you're in Florida, you only get oranges once a year, and those oranges were really close to being harvested, and they're all on the ground now, so those growers have lost that cropping season, not to mention the damage to the trees that might have been uprooted, and having to make those decisions about what do they do next? Do they go back in and replant trees. How do they address that?
Sally Flis:
You were mentioning earlier that we are seeing the exact opposite in parts of the country just north there. I know you were saying in Kentucky, they're getting back into droughty conditions, and Georgia, you were talking to some growers. It's really just this weather piece continues to be a huge impact on how we're able to operate and help create these sustainable production systems in the United States.
Tom Daniel:
Yeah, weather has gotten to be a huge issue. I know I have a lot of friends that question issues around climate, whether there's climate change, and they want to politicize that discussion, but in truth, I don't think any of us can sit around and look and say the climate hasn't changed, we're seeing persistent drought in the West that continues to creep across the country as it comes east. I don't know if you'd heard this or not, but it was on a call I was on this morning. Mississippi River is shut down. They cannot navigate to Mississippi River right now in many places just because there's not enough water flow coming down the river, and that goes all the way up into St. Louis that they're having trouble. Just think of this, what are we in the middle of the Midwest right now?
Sally Flis:
Well, you talk about harvest, and you talk about fall fertilizer applications. I mean, a lot of the fertilizer that's staying in the US or coming into the US, or that we're exporting elsewhere is moving up and down the Mississippi River, and so we've already got high fertilizer prices, and now, we've got transportation problems on top of that, and yeah, a lot of that grain that's getting harvested right now is headed to the same place, and it's got nowhere to go.
Tom Daniel:
Nowhere to go, and when you can't have barge traffic as much as people probably don't realize it, but we are a country that lives on river traffic, and that's where our crops get moved, but thinking about the Florida piece, again, I was just reading an article here that was published recently by the Fish and Wildlife Commission, and they were basically saying that not only the honeybees that you were talking about, and that caught me off guard because I don't think about honeybees, but without honeybees, there's no pollination, and without pollination, there's no crop, right?
Tom Daniel:
But all things that are going on with Florida, because a lot of our vegetable production comes out of Florida, and it was not just the wind, even though the wind did tons of damage, it was the rainfall. I mean, they had such huge rainfall, and then storm surge that came in, and a lot of those fields may not even get replanted in the near future. Just a lot to look at. I was reading an article that said we always think about storms, that there's always insurance, right, but when it comes to crop insurance, a lot of these specialty crops, these high-value specialty crops don't have insurance.
Sally Flis:
You mentioned an interesting aspect there, Tom. We talk a lot about soil testing and developing that soil health. When you've got the beach of Ft. Myers moved into the middle of your orange grove, or your tomato field, that takes a long time to go back to where that field was to produce what you were producing. Like you say, if you even choose to go back there, and then what happens to that land and that whole sustainability system if we don't put farming back on it?
Tom Daniel:
That's exactly right. We depend on that area. This whole country depends on that area and what it produces. You mentioned a minute ago, but I was talking to one of our crop consultants on a call this morning. Georgia felt like they were going to be in the middle of this hurricane. It looked like it was going to just traverse right over Atlanta, right over through the central part of Georgia, and they were so nervous because we're right in the middle of cotton harvest right now. A hurricane at this time would be devastating to most of that market. But then on the call this morning, they had very little damage at all from any of the hurricane. It all stayed out off the coast for the most part, and they were describing how dry it was in Georgia right now. They were actually hoping that, they don't want the wind, and the vicious storm, but they do want the rainfall, and missed all that rainfall this time.
Tom Daniel:
Farming's a tough business always. It's a risky business always, but when we have to deal with the weather issues that we have to deal with, it's getting to a bad place right now. I don't know, we're going to have to deal with this one way or the other, and it's going to change the way we farm, I'm afraid.
Dusty Weis:
At the end of the day, all you can do is just put your best practices in place, and then hope for the best. But you're right, Tom, I think there's just this growing level of uncertainty, and that uncertainty is not going anywhere. It's certainly always been a part of agriculture, but I think it's foremost on everybody's mind right now.
Dusty Weis:
But when we talk about sustainability and uncertainty, certainly we can't leave out the need for economic sustainability as well. Thankfully, we do have tools available to at least help with a little more certainty when it comes to that part. John Maman from Nutrien Financial is going to join us to talk about some of those, and that's coming up in a moment here on The Future. Faster.
Dusty Weis:
This is The Future. Faster. A sustainable agriculture podcast by Nutrien Ag Solutions. I'm Dusty Weis, along with Tom Daniel and Sally Flis, and we're joined now by John Maman, sales and marketing director at Nutrien Financial. John, thanks for joining us.
John Maman:
Hey, Dusty. Thank you so much.
Dusty Weis:
John, while you are the first financial expert to join us here on the podcast, economic sustainability is something that we've brought up many times throughout the conversations that we've had. By that, we mean farmers making it through the current growing season and being in business for years to come. How would you define economic sustainability?
John Maman:
I think economic sustainability means something different to everybody. We look at the times we're in with rising interest rates. I think any individual would hope that economic sustainability involves something similar to less overall impact to their lives or livelihoods, all while experiencing growth, economic growth, personal growth, and that sustainability for sure has changed quite a bit over the last six months or so.
Sally Flis:
John, what does Nutrien Financial offer that can help a grower achieve and maintain their economic sustainability as they look to finish out the 2022 cropping season and going forward over the next growing season, or 5, or 10, or 20 years?
John Maman:
We offer a lot. I think it's first important to note that we're embedded within Nutrien Ag Solutions, and so it's that direct agronomics, direct economic piece that we hope to achieve that's all driven from our field staff. Certainly, within that economic sustainability that you referenced, it all comes down to rate with financing and service. As far as rate's concerned, prime certainly changed quite a bit as I mentioned over the last six months where we've gone from three-and-a-quarter up to six-and-a-quarter very quickly, and so I would imagine that if those listening are like me, it's shocking to see how fast interest rates have risen.
John Maman:
Some of the things we do is try to take the shock waves out of the marketplace by fixing the rates that we have. Many of the rates in the marketplace are again, based off of prime, where we are trying to take those market rates and have fixed options because many of our growers operate on an annual income. You plant a crop, you raise a crop, you harvest a crop, and that income that you aspire to achieve is based on yield and based on that output of your season. But rates can fluctuate during that time, so the first thing we do is we really have tried to fix our rates and offer a number of fixed-rate options in the marketplace so that the growers know that at the end of the year what they've accrued potentially is actually what the market is going to allow them to accrue, meaning that prime isn't going to mysteriously adjust throughout the year as the market changes.
John Maman:
The other thing we do is we partner with a lot of our strategic suppliers and internal brands like Dyna-Gro and Loveland Products to offer programs that are better than what the market might offer that are at 0% in the case of our seed programs, and very low rates in many cases concerning our crop protection, so it's really to offer that consistency as well when we look at how the market would change, and then how we can respond to it for our customers.
Sally Flis:
I'm going to throw an extra question in here, and the podcast listeners and Dusty and Tom are used to me doing this, but for me, I've been with Nutrien for two years now, and I know Nutrien Financial is an entity that we have, but I don't know much about how you guys operate, so could you take a step back for us a little bit, and talk about how would you even get involved with Nutrien Financial? Where does it sit in relation to retail branches and the crop consultants that growers might be working with on a daily basis?
John Maman:
Yeah, so Nutrien Financial has really existed in its fullest name for the past five years. Before the merger of Agrium and PotashCorp, we existed as Agrium Financial Services, and then after the merger became Nutrien Financial. Nutrien Financial really exists to provide crop input financing plan around our customers' needs, and if we look at what we used to have, we always had credit services, we had the ability to lend to our growers for the inputs and services that they need. Nutrien Financial came in and really looked at taking this more broadly by offering best-in-rate financing, partnered with some of our suppliers brought to the farm for the unique needs of our customers, but really focusing on taking a field presence.
John Maman:
What was missing before Nutrien Financial was we had a great, well-seasoned credit staff, but oftentimes we wanted that field presence at the same time to be able to make those conversations easier, offering the expertise of a field manager to be able to sit with our customers and our branches to look at that agronomic plan that they're building, and provide the economics alongside that plan to really provide the best output for their cash flows, because at the end of the day, we recognize that yield is the main driver for our growers and that profitability, but the economic aspect of how they fund input purchases, and purchase from us means a lot.
John Maman:
There's savings also within the rates that we can offer, and the process that we use to be able to blend the best terms rates and incentives, and so we've always been able to offer credit in the marketplace. I think our approach is what's unique and it's certainly what's uncommon and what I find is when we have the opportunity to sit down with our customers and talk about this, it's something that transcends the relationship to a whole other level by offering that extra level of expertise that our growers are looking for, or in some cases, not looking for, and realizing that they need it, and they could make a huge difference in their operation.
Tom Daniel:
John, a lot of discussion around economic sustainability, but there are some other issues that are coming to the forefront now in agriculture, and not just for downstream partners in the CPGs, the consumer product groups that we work with, and those types of people, but also, we've got some large farmland investment groups, and even corporate farms that are having to deal with something called ESG, Environmental Social and Governance, scoring on their operations. These are sustainability metrics that are on the farm today. The consumer markets are becoming more and more attuned to what these ESG numbers are and especially when it comes to investment groups and people looking at green investment opportunities. My question to you on the finance side, and I know even finance groups have ESG requirements today that they are tracking, but how is finance playing a role in helping growers implement sustainable practices on the farm, and then how will financing continue to do that in the future?
John Maman:
Tom, we're always looking at ways to improve our relationship with ESG protocols that are in place. I think one of the easiest ways we can do that right now is making sure we match the cash flows with the needs and timing of our growers. Whether you are on the East Coast and you have a vegetable market in the Northeast, or you have strawberries in Salinas, California that might come out two or three times a season, or anywhere in-between the row crops, we're trying to match the cash flows that our customers need to be successful, recognizing that there's a sustainable element of how they raise those crops, and how they aspire to raise those crops that's there. As we continue to invest ourselves into the market of sustainability, there's a lot that I think we can do when we start looking at the carbon credits ESG, but a lot of those options are being developed as we speak.
John Maman:
When it comes to plan a significant role in financing, the single greatest thing we can do is be present at the table to be able to discuss what really helps our customers be successful, matching their needs with the right payment options, and not just with financing, but blending the best aspects of cash, prepay, and financing so that they know that they have every option at their disposal to be successful throughout a crop year because one of the things that can't be a surprise is what you're doing with your money, and how you're carrying your terms. The market has so many other ways to surprise us, and we've seen that with the interest rate hikes. We've seen that with weather, and again, our customers are family people. They're tied to things outside of just the agronomic practices that can pop up at any given time. Our financing doesn't have to be one of those surprises, it has to be a complement to everything we're doing. That really includes everything that we're doing with ESG and the sustainability group within Nutrien Ag Solutions.
Sally Flis:
John, to circle back to what you mentioned earlier as you were describing what Nutrien Financial is, you guys are working in the field with crop consultants, with growers to implement these whole-acre solutions that Tom and I talk about all the time that play into our carbon programs and play into the ESG reporting. What are some of the metrics that you're looking at in the field as you look at your interaction with something like an ESG report back to the company?
John Maman:
I would hope that we're leveraging all of our resources and our expertise to be able to help drive that initiative. Our goal is to be able to meet our customers where they are at their farm gate on their acre, recognizing that whether it's an acre down the road, or an acre across the country, their needs are unique, and everything they do has to be customized for them, and we have the field expertise really to achieve that. There's certain metrics that are put out there for ESG, but ultimately, it's up to our customers and our farmers to take those and implement them.
John Maman:
I think, again, as we look at financial services, that has to be the complementary piece, not the impediment, and it's important that we work that way to be able to provide the expertise that makes a difference for their cash flow, and then stepping aside, and allowing our resources and our subject matter experts that really know that ESG industry and those objectives to be able to take that and move it forward, because at the end of the day, if payment is one impediment, it's going to be a major one to achieving those goals, and if we don't move efficiently and provide the right options and then step aside and allow our counterparts to be experts in that area, we just become one other lagging indicator in those reports, and a reason for why the success wouldn't necessarily be achieved. I think we've done really well to be partnering with the right individuals with Nutrien Ag Solutions to be able to help achieve those goals, knowing that our financial services are a differentiator, and that they shouldn't at any time be something that would just ease our grower's mind as they move through that process.
Sally Flis:
Yeah, and Tom and I touch on that, we try and talk about working with a grower to figure out what is that resource concern, right? Sometimes it may be a water quality thing, it may be a soil thing, but sometimes, like you're saying, that resource concern for implementing the next best management practice is they're not sure where to go next with the financial management piece, so it's great to hear the overlap there.
John Maman:
I would add that you could do all of those things right and still have a worry about how you're going to pay for it, how you're going to cash flow it. To me, that's one big obstacle when we look at all that we have to achieve with the ESG and sustainability platform is we could follow all of those practices, but then at the end, before we make that decision to do it, really worry about how we're going to get that done financially. For us to be able to provide flexible terms that meet the needs of our customers across multiple different crop types, I feel like that really takes the worry out of following what really matters in the sustainable practices and allows our customers to be able to move forward with confidence.
Dusty Weis:
John, in that vein, I know that the financial products often get a lot of the spotlight here, but there's a few years ago now that I first opened a small business account at my bank when we launched our business here, and one thing that I guess surprised me coming from a world of consumer banking to business banking was the number of resources just besides the financing that are really available in that space as well, everything from advice to consulting to just good best practices. Everybody's always so professional and willing to help out. I guess my question to you is what's something about Nutrien Financial that most folks might not know, or might surprise a lot of folks?
John Maman:
Well, first off, it's important to know that you're surrounding yourselves with the right individuals. You mentioned your local bankers and those that would have a vested interest in your outcome and your success. I think number one, it's surrounding yourselves with the right people.
John Maman:
When it comes to Nutrien Financial, we try to mimic that for the inputs and services that we offer, making sure that as you look at a relationship with Nutrien, it doesn't have to feel like a large company. It can feel like that localized relationship by bringing in many different subject matter experts from around the company, whether it be an individual that talks to you about Dyna-Gro Seed, or Loveland Products, or our sustainable efforts. With Nutrien Financial specifically, we have field-based financial services managers that are stationed all across the United States that are based in the field, work within our retail organization direct to our customers to sit down and have this plan.
John Maman:
Dusty, it could be something as simple as asking a couple of questions about, "Am I still doing this the right way? Should I be thinking of something else?" Or it could be even deeper by taking that agronomic cropping plan and building a financial cropping plan, if you will, that blends the best aspects of cash prepay and financing so that our growers have truly every option at their disposal.
John Maman:
What doesn't keep me up at night is the fact that our finance programs won't get used. I know we have best-in-class offers. I know we have rates and incentives that are tailor-made to our customers and their crops. What keeps me up is that not enough people know about these so that they might miss the opportunity to hear about this and really understand that we're not trying to put everybody in the same bundle, we're trying to customize this for our growers, for their situation, for their economics, and having a conversation that can be hard to have, but planning around their total business, and making sure that we're really there as a partner.
John Maman:
A financial cropping plan doesn't have to end with that first planning session. Inevitably, as you work throughout the agronomic year, your agronomic plan changes consistently, whether it be because of pests, pathogens, weather, supply chain, so should your financial cropping plan change with that. It gives us another opportunity throughout the year to revisit that plan, make sure that we're doing right by our customers, and that we're doing everything that's within our power to help them be the most successful they can be for that annual basis. If I had to ask you, Dusty, "Is that something that you'd be interested in?", what would you say?
Dusty Weis:
I'd say, "Sign me up." I'd say, "I'm into it."
John Maman:
If we could help you blend the best aspects of all your financial investments for your operation, to me, that sounds like a pretty good value proposition.
John Maman:
Back to one of Sally's questions about how we get started with Nutrien Financial, we've tried to take the backend conversation, which is what our team does in the field, and make it easier on the front end by partnering within our digital platform to be able to give our customers touch to an online application that allows them visibility to where that application is throughout the process because one of the things that we find that is challenging is the anxiety of the unknown of where that paper application went after it's filled out. Who sees it? Where does it go? Where does it end up? Our online application not only provides our customer visual status updates of where that application is, we know that that information goes in a secure fashion straight into our credit department where they need to make the decision, not myself, not my team, not the local crop consultant and advisor because we recognize that we're all part of one community here within the ag world.
John Maman:
That information should be kept private, should be kept whole for the family, for the corporation that needs it and should only be seen by those who have to have it, and so just as much care as we take on the back end to provide that financial cropping plan, we like to think that we're providing every bit of care on the front end to make sure that our growers know that we're taking the best care of their information we can from start to finish throughout the year.
Tom Daniel:
John, I'm going to finish up and ask you two quick questions, and one of them is, give me an idea, what does Nutrien Financial have going on in the fall? I know we're right in the middle of seed kickoff, where we're actually positioning seed in the marketplace and we're using Nutrien Financial to promote and drive that forward. Then the last question, which is a personal question, what's your favorite restaurant that you've eaten at in all of your travels you've had? Because you're my restaurant connoisseur when it comes to eating out at restaurants as we travel together.
John Maman:
Tom, that's a loaded two questions there. I'll start off with the fall business. We've got a lot going with fall options for financing options that'll get people past just the end of the year, options that'll get our customers through the next crop year, recognizing that in the North, fall fertilizer is an application made for the 2023 crop, and we have crop terms that fit. Likewise, if you're looking at burndown, you're looking at cotton defoliation still in some areas, we've got options that can fit the cash flow needs of our customers.
John Maman:
Everything starts with seed, and obviously, our seed programs are out, but that doesn't, again, allow us to just focus on seed. We should be focusing on that total acre solution because if you want to hit your metrics that you're governed by within the ESG group, you have to look at that whole acre solution, and how it's going to flow throughout the year. Again, for our financial cropping plan, we want to make sure that we're right alongside you in those ambitions and that we're planning around every single input selection of the year, so yeah, seed's great, seed's on 0% leading with our Dyna-Gro, and some of our other leading brands that we have within our company, but we also have a lot of different options for crop protection and fertilizer. It really comes down to the localized presence at your local Nutrien Ag Solutions branch to be able to learn more about that and really build that agronomic plan out with your economic plan.
John Maman:
Your second question, you hit me with a ringer that usually I take a lot of care in preparing for. I would say my favorite place to eat on territory is usually at home with my wife and my children when I can put things on my smoker. I have a smoker in my backyard and I'm a patio chef, and if you think we find good stuff out in the field, you should see what I can cook in my backyard.
John Maman:
It really depends on area. I think if I have the opportunity to eat somewhere, I always love going down South and enjoying the culture and the food down there, but also the seafood because living in Indianapolis, you don't exactly get access to stuff like that. There's a little place in Perdido Key, Florida called Fisherman's Quarter. If you haven't heard of it, it's a delicious place. They've got New Orleans barbecued shrimp like you would've had at Mr. B's Bistro in the French Quarter, which is another one of my favorites, but it's a real little place underneath the viaduct. I went there with one of my dear friends within the retail organization, Bill. He introduced me to that place, and I think about it, talk about it with anybody who goes through that area ever since then. It's right there in between Perdido Key and Orange Beach and it's a gem. If you're headed South now, you keep going, you might be able to get there by dinnertime.
Dusty Weis:
Well, some dynamite recommendations there. I don't know if you can tell, but I'm jotting these down frantically here. But John, it has been edifying to talk with you here and get those food recommendations as well. John Maman, Nutrien Financial director of sales and marketing, thank you so much for joining us on this episode of The Future. Faster.
Dusty Weis:
That is going to conclude this edition of The Future. Faster. The pursuit of sustainable success with Nutrien Ag Solutions. New episodes arrive every other week, so make sure you subscribe in your favorite app and join us again soon. Visit futurefaster.com to learn more. The Future. Faster. Podcast is brought to you by Nutrien Ag Solutions with executive producer Connor Erwin and editing by Larry Kilgore III and it's produced by Podcamp Media. Branded podcast production for businesses, podcampmedia.com. For Nutrien Ag Solutions, thanks for listening. I'm Dusty Weis.
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