Section 2: Evaluation of the Product
Taking the information about timothy grass, including its optimal growing conditions and seed size, the effects of expanding the Canadian trade division of timothy and knowing what the grass can bring to the farming people of Nepal, we can now evaluate the product and check to see if this export is actually a good investment.
Costs to the Farmers
The cost to buy directly from Brett Young is $1.75 per lb of seed, and to transport the seeds to China the cost would rise to around $2.25 per lb (R. Mabon, Personal communication, November 4th, 2016). This cost is relatively low compared to the cost of other forage grasses like ryegrass which averages around $3.00 per lb and wheatgrass, around $5.00 per lb (NorthstarSeed, 2014). Also timothy seeds are quite small, with more than 1 200 000 seeds per lb, meaning that only 3 lbs of seed are required for a one hectare field (NorthstarSeed, 2014). To get a more accurate estimation of the cost to the Nepalese farmers it would be appropriate to add some more to the price since there will probably be a distributer in Nepal looking to make a profit. There are currently more than 1300 registered seed distributors in Nepal (SEAN, 2014). Trade possibilities increase when dealing with a retailer instead of individual farmers because they probably have the means to store the seeds for a longer period of time, and will be able to supply to a full community, thus allowing them to buy in bigger bulks.
Importing from other Countries
Even though timothy grass does great in the Canadian environment, it is not the only country in which one can purchase timothy seed. China sells timothy for as low as $1.05 per lot, including shipping (Alberta Agriculture and Forestry, 2004). New Zealand is also a closer country that has invested in timothy grass production but their prices won’t compete.
Costs to the Farmers
The cost to buy directly from Brett Young is $1.75 per lb of seed, and to transport the seeds to China the cost would rise to around $2.25 per lb (R. Mabon, Personal communication, November 4th, 2016). This cost is relatively low compared to the cost of other forage grasses like ryegrass which averages around $3.00 per lb and wheatgrass, around $5.00 per lb (NorthstarSeed, 2014). Also timothy seeds are quite small, with more than 1 200 000 seeds per lb, meaning that only 3 lbs of seed are required for a one hectare field (NorthstarSeed, 2014). To get a more accurate estimation of the cost to the Nepalese farmers it would be appropriate to add some more to the price since there will probably be a distributer in Nepal looking to make a profit. There are currently more than 1300 registered seed distributors in Nepal (SEAN, 2014). Trade possibilities increase when dealing with a retailer instead of individual farmers because they probably have the means to store the seeds for a longer period of time, and will be able to supply to a full community, thus allowing them to buy in bigger bulks.
Importing from other Countries
Even though timothy grass does great in the Canadian environment, it is not the only country in which one can purchase timothy seed. China sells timothy for as low as $1.05 per lot, including shipping (Alberta Agriculture and Forestry, 2004). New Zealand is also a closer country that has invested in timothy grass production but their prices won’t compete.