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On-farm storage expands options, saves money

AgriNews Field Editor Tom Doran (right) interviews Foster's Mechanics LLC owner Phil Foster at the Midwest Ag Expo about grain drying and grain storage challenges and opportunities.
AgriNews Field Editor Tom Doran (right) interviews Foster's Mechanics LLC owner Phil Foster at the Midwest Ag Expo about grain drying and grain storage challenges and opportunities.

GIFFORD, Ill. — On-farm grain storage in Illinois and Indiana has increased the past 10 years. According to the U.S Department of Agriculture, on-farm storage has increased by 90 million bushels in Indiana to 860 million bushels and Illinois has seen a 50 million bushel jump to 1.48 billion bushels from Dec. 1, 2009, to Dec. 1, 2019.

Phil Foster, owner of Foster’s Mechanics in Paxton, said during the Midwest Ag Expo farmers are installing or adding bins to avoid harvest downtime and have storage and marketing options.

Poor field conditions extended the 2019 harvest, and there were just small windows of opportunities to get into the fields. When it was fit, the crop had higher than desired moisture content, forcing the need for drying and adding more cost at a time of low commodity prices.

“On-farm storage and dryers provide an option where you don’t have to pay someone else for drying. You can save a lot of money by drying it yourself,” Foster said.

There were reports of grain elevators shutting down early last fall because they were at capacity in the midst of harvest.

“So, you have the downtime and you can’t do anything, it’s getting late in the season and you have to get things out. The weather turns and 25% of your corn is still out there in the field. The corn is going down and you’re losing yield every day it’s out there. Any way you can speed that harvest up is beneficial,” Foster continued.

He added on-farm storage can also save in drying costs.

“You can save a lot per bushel because if you try to dry we’ll say 1,000 bushels and it is 25% moisture, I think we figured that according to the elevator you come out with 840 bushels because it shrinks. That’s the on paper, and by the time you’re done you’ve pretty well paid $1,000 to have that dried down. So, if corn is down to $3.50 a bushel, you’re going to lose $1,000 off the top,” he said.

“So, if you’re thinking it was going to be $3,500 you’re going to get for that semi load. Well, now that’s changed a lot. You’ll get $2,500 or a little less than that.

“The normal rule of thumb is it would be half of what it would have cost you at the elevator. A lot of the cost just depends on where you’re at for natural gas, propane, power companies and how much you use.”

Savings, Return

There also is the opportunity to save on storage costs with on-farm bins.

“Sometimes there’s the premium you can save just holding our crop until January. I hear a lot of guys say you can save 20 cents, 30 cents per bushels, just depending on if the basis has gone up or whatever the price of the commodity is at the time. That can be very beneficial,” Foster said.

There is also an eventual return on investment.

“We don’t know how long that return is going to be. Is it going to be two years, is it going to be five years? A lot of it depends on your marketing, how much you have to dry and all of that. So, that’s what can affect your payback on whatever you put in. But it’s going to payback and then once you have it paid for, then it’s just that extra income that you’re getting from that,” Foster noted.

Demand

It’s obvious by the USDA data there has been an increased interest in both on-farm and off-farm storage expansion for several reasons.

Yields have increased over 10 years, and elevators are adding on because they may not have the storage to meet the demand.

Also, on-farm bins are aging and small.

“Nobody wants to use them because you have this small bin and you have to carry this sweep in, and it has a 6-inch unload, it takes forever, it takes too much time to do what they need to do. They don’t have the time to deal with that. They have a 10,000 bushel bin on-farm and they’re just going to haul it to the elevator instead because they can dump it fast there and not worry about that penny-pinching,” Foster said.

“I think now the way the markets are and everything, your return on a grain storage system can payback and it can make you money and make it to where in these tight markets you can get more of your premium dollar out of it and get the most you can for what you’re raising.”

New grain bins have features that are more efficient, safer and easier to use on-farm.

“You have power sweeps in a grain bin. You don’t have to carry it in. You can get 10-inch unload and you can unload or load a bin, 4,000 bushels an hour, or you can get 6,000 bushels an hour. If you get 6,000 bushels an hour that’s loading a semi in 10 minutes, and it used to be 45 minutes with a six-inch auger. That’s a big difference and you can just keep the semis coming. There are a lot of benefits,” Foster said.

Wintertime is an ideal time to order grain bins and grain equipment as companies are offering winter discounts and farmers can lock in those deals and have a system in place for next fall.

What’s New

Foster’s highlighted two new features during the Midwest Ag Expo, the Sukup Mixed-flow Dryer and Sukup Paddle Sweepway.

The Mixed-flow Dryer combines the grain quality of a mixed-flow dryer with the vacuum-cooling efficiency of a tower dryer. The result is high test-weight grain while burning less fuel per bushel dried.

Maintenance is also reduced with mixed flow dryers because there are no screens that need to be cleaned on cool, damp days to maintain capacity and efficiency.

The Paddle Sweepway is a new safety feature for grain bins compared to a typical auger. It’s a safe option to fully clean out a grain bin. This upgrade can be added to new or retrofitted to any existing Sweepway or U-Trough and Power Sweep for both drag conveyors and loop systems.

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