Next in a series from Iowa farmer Tyler Bruch, Global Ag Investments, who farms 44,000 acres in Bahia, Brazil and 7,500 acres in Ukraine.
So far, 2008 has been another very interesting year for Global Ag Investments. We have truly defined ourselves as a global player in production agriculture this year with operations in Iowa, Brazil and now Ukraine.
Our decision to start up in the former breadbasket of Europe was based on cheap land and labor, great logistics and some of the most fertile soil in the world. Western agricultural management is necessary to help re-establish the former agricultural superpower of Europe.
The ability to start farming internationally anywhere comes down to having good people. My brother Justin, who has been involved in our Iowa and Brazil operations, made the move to Ukraine to head up operations there. While getting started in a foreign country can be very difficult no matter where you are, learning Russian and dealing with the local and federal bureaucracy are incredible — it makes Brazil look like a cakewalk.
UKRAINE GAINED ITS independence from the Soviet Union in 1991, and upon breaking from the former USSR, every Ukrainian citizen was granted 2.5 hectares of land — roughly 6 acres.
Most of this land was only partially farmed. I say that because it has been done so poorly from lack of capital and management that, in my eyes, it really has not been farmed at all. Most U.S. farmers wouldn't believe how badly things have been managed in Ukraine.
The 7,500 acres we have under management in Ukraine present several challenges. The land has been so poorly taken care of that it will take us a solid year to get things straightened out. The farming practices used before our arrival would be unacceptable to anyone who has ever been on a U.S. operation.
Here's an example of the poor management:
Apply a base 9-13-30 NPK fertility pack to the ground so you can get the weeds to grow better.
Kill the weeds with Roundup or 2,4-D.
Work the ground up to seven times before planting.
The list could go on and on, and we just scratch our heads. But, that's to be expected from people who were taught under the communist system. They didn't care if they made money or not; that was not their objective.
TO FARM IN Ukraine and be successful, we knew it was crucial to bring Western technology into the country. The equipment most Ukrainian farms use is 50 years old — they call it well used. We called it junk and marked most of it for the scrap pile.
After equipment options did not present themselves, we decided to buy equipment in the U.S. and ship it in containers, which meant dismantling a John Deere 9620T, 8430T and 4920 sprayer to fit into 8×8×40-ft. sea containers. After arrival they all had to be reassembled.
A few years ago in Brazil we had to put together a planter nearly from scratch and it was a chore. Putting together tractors with no air tools was not much better.
The flipside to most of the headaches is the opportunities that are present. The soil test on the farm had most phosphorus (P) levels around 150-200 ppm and potassium (K) levels around 220-250 ppm. We figure we can get by without P or K for the next few years.
The fields are 600-900-acre chunks of the nicest flat, black-dirt fields any farmer in Iowa would die for. (According to the history books, Hitler used to send trains to the heart of Ukraine and have troops shovel the cars full of dirt to take back to Germany.)
Our cropping plans in Ukraine are rapeseed, winter wheat, winter barley and sunflowers. The planting season started around Sept. 15 and will be nonstop for another month as we push to get everything in the ground and up and going before the first frost of the season.
I spoke with Justin in Ukraine on Sept. 18, and they had about 150 acres of rapeseed planted, but they had been getting a lot of rain and weren't able to get much done. In Iowa, my brother Lance was making final equipment preparations to start harvesting soybeans. In Brazil, we just finished cotton harvest and continue to make preparations for the planting season that should start by the time you read this.
So, even though we're scattered all over the globe right now — and are all dealing with different problems on a daily basis — we all have the drive of any farmer: Push on, for tomorrow is another day.
Editor's Note: A CNBC TV documentary on Tyler Bruch can be viewed online at www.cnbc.com, then keyword: Bruch.