A Walmart representative on the Pro Farmer Midwest Crop Tour calculates soybean samples from an Illinois field.

Walmart making marketing decisions from crop tour

When it comes to the list of participants that took part in the four-day trek across the Corn Belt for the 2014 Pro Farmer Midwest Crop Tour, the backgrounds of those that hit the road and the reasons for them wanting the see America’s corn and soybean crops first hand, were vastly different.

The farmers wanted to see how different farms and fields of the U.S. were faring compared to their area, market analysts wanted to be able to give the best advice possible so their clients can make the most money for their goods and America’s largest food retailer, Walmart, was looking to position the company in a way that will save their customers money today and in the future.

“We have categories in our portfolio that include sugar, flour, oil and cornmeal,” said Tim Robinson, the Director of Dry Grocery, Baking Team for Walmart. “When you think about our private label business, ‘Great Value,’ we actually have a pretty heavy say in how we hedge and manage our costs. Being on this tour has an educational component as we need to know the markets in the best way that we can because that is our biggest cost input. It would be a waste of time to negotiate with suppliers who manage brands when our ‘Great Value’ brand is the biggest one in our stores and CBOT is the biggest component of the cost. This is the best way to save money on our costs and pass those savings on to the consumer.”

This was Walmart’s first year on the Pro Farmer Midwest Crop Tour and Robinson says that if he saw something that his company might be able to capitalize on while being on the tour, he could make the call.

“My buyers and I own the Profit and Loss Statement, so we can get on the phone at a moment’s notice and tell our suppliers to lock in certain costs immediately,” Robinson said. “For hedging, sometimes we will go short at 30 days out and sometimes we’ll go 18 months long if we feel there is good value and that bullish impacts could hit the markets soon. We make those decisions and that is why we felt being a part of this crop tour was so important.”

Was there anything on the crop tour that caused Robinson to make one of those phone calls from the road?

“There was, as it relates to the short term and this Holiday season,” Robinson said. “And I’ll leave it at that.”

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