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BATTLING FOR BALING RIGHTS

  • By Kim Allen
  • Prime Line
  • Fall 2001

When you're in a competitive battle to earn the right to harvest hay from farmers' fields, the ability to do a quality job in a timely manner is paramount.

Adhering to that "service-first" philosophy has paid dividends for Bill Levy and Jeremy Kennel as they've built their custom hay harvesting and marketing business into a thriving enterprise.

"When it comes down to it, we offer farmers two vital services-speed and quality," Levy notes. "That's important to our customers, who are anxious to get the windrowed hay off freshly cut grass to allow regrowth as soon as possible. We're very responsive to their need for speed, and we're picky about the job we do. Farmers like that."

"We'll do whatever it takes to impress our customers," Kennel notes, whether it means baling all night or starting a field while the combines are still finishing the seed harvest."

It's no coincidence that Kennel and Levy, operating as K & L Farms and based at Echo, Ore., run seven Hesston balers. Their choice of Hesston coincides with their mission of speed and quality. "We can't afford downtime; that's why we run Hesstons," Levy states.

During this season, they used two Hesston 4790 large square balers and five Hesston 4690 conventional square balers to bale more than 35,000 tons of hay.

"These 4690 three-tie balers are the best you can get for grass hay," Jeremy notes, as he guides his pickup across a newly harvested field. He inspects every corner to ensure that his crew's efforts meet his and Levy's exacting standards. "They'll make a 115-pound bale with no problem, and that's hard to do."

He explains that the forage from grass is much harder to bale than conventional forage. "It's light and spongy, which really challenges a baler. But these Hesstons do a good job of processing it," he adds.

He says the business is gradually moving toward favoring the bigger square bales. So now they are running two 4790s to meet this challenging demand.

The two young entrepreneurs serve two of Oregon's most productive grass-producing farms; Bill in eastern Oregon and Jeremy in the central valley of western Oregon. Now, at age 24, they're putting the finishing touches on their academic careers. Jeremy's degree from Oregon State is in general studies, while Bill is completing his master's degree in agricultural economics from Washington State. All the while, their business has grown to become a successful career.

Besides being good friends, Kennel and Levy say they work well together from a business point of view. "We absolutely think alike," Levy states as he breaks away from a two-way radio conversation with his partner. "Yet our individual skills complement each other's. I'm good with computers and the numbers end of the business, while Jeremy is more talented than I am at managing people."

This is a service-oriented business, where the forage that comes off a farmer's field is less important to the customer than clearing the way for future grass-seed production.

"We bale the grass hay and get it off the growers' fields just as soon as possible," Kennel notes. "The hay goes to a variety of buyers, ranging from area cattlemen to an export buyer who shrinks the bales for marketing to overseas dairies."

The three-tie, 115-pound bale remains the bale of choice for most export markets. Once the partners sell these bales to an exporter, the bales are compressed for shipping. Grass hay is an excellent, economical source of protein that is in demand on dairies incountries such as Japan, where farmland is getting scarce.

By getting ownership rights to the hay, Levy and Kennel use proceeds from hay sales as payment for the harvest services they provide. In some years, when demand for hay drives market prices high, Levy and Kennel rebate a portion of their income from hay sales to their customers.

"Naturally, everyone is happy when prices are high," Jeremy notes. "But our business has grown more in years when prices were too low for us to share sales income with farmers. During a good year, a lot of services are willing to harvest a grower's hay; the test is whether they will be around to serve farmers when it's hard to find a market for it. We've worked hard to build a good reputation with our buyers who stick with us year after year."

Skills in dealing with people are important not only when they're dealing with the customers and hay buyers, but also when dealing with employees. That's been one of the major challenges for the partners, as they are establishing a business while they are still so young.

"Generally, we hire crew who are still in high school or college," Jeremy notes. "I think our youth helps us relate to these young employees, but it's also a challenge to have people working for you who are near your own age or even older than you. We try to do whatever it takes to be good employers."

They also subscribe to the theory that "there's no substitute for the bosses' shadows." They stay on the run to oversee their crew of 15 employees, who are often in several fields operating 10 tractors and allied equipment to deliver the services their customers have come to expect.

On the equipment side of the business, the partners credit Denzil Robbins, owner of Robbins Farm Equipment, Inc., in Baker, Ore., as a key player in their success story.

"We've run Hesstons from day one," Bill says, noting that they started with two rented Hesston 4690's. "It was a good way to get into the business because we had the option of turning them back in the end of the season. Instead, we ended up buying the units.

"Denzil has supported us in every way from the very beginning. He has alway been available to help us handle problems, and he provides the parts and services we need to ensure timely harvest for our customers."

Robbins furnishes parts catalogs for the partners so that they can have instant access to parts information. That's a real timesaver they they call the dealership.

Besides selling and servicing K & L's fleet of Hesston balers, Robbins Farm Equipment leases 10 Massey Ferguson tractors to the business.

One of the dealership's most valuable services is an off-season maintenance program for K & L's fleet of balers. At season's end, service crews from Robbins Equipment transport the balers to the dealership and perform a thorough maintenance program during the winter.

When grass harvest begins the following year, the balers are returned to Bill and Jeremy for another trouble free season.