WEST LAFAYETTE, Ind. — A return to better crop-production
weather and larger corn and soybean yields have combined to give much of
Indiana’s grain-handling industry a full workload after the 2012 drought left it
with little grain to store, transport or process.
Indiana has nearly 1.3 billion bushels of grain storage
capacity, and according to Purdue University estimates, about 30 percent of it
sat idle last year. That represents the largest underutilization of the state’s
grain storage capacity since the 1988 drought.
“The annual value of the Indiana grain industry at the farm
level is nearly $10 billion, so to not use 30 percent of the capacity had
considerable economic impacts across rural communities in terms of lost jobs and
reduced hours for workers,” said Chris Hurt, Purdue Extension agricultural
Grain storage is a fixed capacity, meaning the associated
costs continue even if there isn’t enough grain production to use it all. That
capacity has to be in place for high-production years, but in low-production
years similar to 2012, it comes with continuing costs and no returns.
The economic implications weren’t limited to just grain
storage, though. Processors of biofuels, food, animal feed and other products
made from corn and soybeans also slowed production because of a lack of grain
and extremely high prices for grain that was available.
“Indiana is a major grain processing state, so those
industries are now returning that idled capacity to work after periods of
shutdown in the past year,” Hurt said.
The drivers behind that return to work are a corn crop
that’s expected to be near a record-high 1 billion bushels this year and
near-normal soybean production around 250 million bushels.
Hurt said the combination of the two crops will use nearly
all of the state’s storage space.
“We expect about a 5 percent underutilization, and it turns
out that over the last several decades, that’s been about normal,” he said.