On-farm grain storage systems have many benefits for farmers. From saving money on storage costs and drying to having easier, around-the-clock access to grain, on-farm storage allows farmers more flexibility and control when it comes to selling after harvest.
To understand just how beneficial on-farm grain storage can be, we sat down with Richard Brock, Chairman of the Board at Brock Associates, and talked about how farmers can get the most out of their grain. Brock Associates oversees grain marketing for 700,000 acres of farmland across 20 states.
Brock highlighted four major benefits of having on-farm grain storage: increased harvest efficiency, more control over when you sell, instant access to grain, and money saved at the dryer.
1. Harvest Efficiency
Harvest is often the busiest time of the year for farmers and the work is nonstop. The last thing you want is for your truck to be stuck in line at the grain elevator waiting to unload.
“No one wants to be truck number 33. That means there are 32 in front of you. Time is valuable at harvest time,” said Brock.
“This issue can vary significantly from one farm to another depending on who you are delivering the grain to. Some merchandisers of grain, whether they be an elevator or an ethanol plant, can be efficient in getting trucks unloaded and on their way. But more often than not, that is not the case. Money is saved by getting a crop out as fast as possible.”
Even if you don’t place all your grain in on-farm storage, having additional bins available for harvest can save you time and money. As farming equipment improves, harvest takes less time. Your storage capabilities need to keep up with your equipment to take full advantage of the season.
Faster harvesting can also lead to grain elevators filling more quickly, and a higher likelihood that space will run out. Leaving crops in the field with no place to store them could cost you money. Having overflow storage on the farm will help keep harvest moving quickly and ensure that you aren’t leaving potential revenue sitting in the field. For this, Brock recommends farmers have storage capacity for 110% of their expected yield.
2. Market Pricing and Timing
Grain prices are often at their lowest right after harvest due to high supply. Waiting to sell crops is a common strategy for many farmers. According to research conducted by Brock Associates, grain bins are one of the best investments on the farm. Having storage on the farm can increase your margin by an average of about 40 cents per bushel when holding your grain through February after harvest.
However, waiting out the price dip can often be expensive.
“Farmers don’t see grain elevators as a monthly cost… it’s out of sight, out of mind until the grain is sold,” said Brock.
You can reduce your rent costs by splitting your grain between on-farm storage and the elevator. Having instant access to some of your grain on the farm also comes with great benefits.
3. Increased Control
Choosing to hold your grain after harvest comes with some risks, no matter where it is stored. Market conditions in agriculture are often volatile, with grain prices changing by the hour depending on a vast number of factors outside of the farmer’s control.
Should a good price arise, farmers need to have easy access to their grain to act on it before the opportunity passes. When storing in grain elevators, farmers might have problems accessing their crop on short notice and could miss out on a price increase. With on-farm storage, farmers have instant access to their grain and can take full advantage of market changes.
On-farm storage also allows farmers increased control over any problems that might arise with their crop. Vomitoxin, for example, has been a problem for some farmers with fields that are too wet during the growing season. Any diseased grain may not be accepted at most commercial grain elevators. Farmers with on-farm storage can combat this issue by drying and storing the diseased grain until it can be diluted with a better crop, allowing them to sell the blend at a later point. While the blend might not be sold at full price, farmers can still make up most of the revenue they could have lost by dumping the diseased grain.
4. Save Money at the Dryer
On-farm storage and drying will also save farmers money. Commercial drying and storage costs are at their highest during the height of harvest due to the increase in demand. By storing your grain on the farm, you can save thousands drying and storing your grain yourself.
According to Brock Associates, a producer can dry corn for about one-third of what an elevator charges, though this obviously varies considerably from year to year depending on natural gas or liquid propane charges.
Is a Storage System Right for Your Farm?
Storing your grain on your farm comes with many advantages. From improved efficiency and easy access to your crop, to increased control and long-term money savings, it’s worth considering the benefits for your operation. If an on-farm storage system sounds right for your operation, explore our Grain Storage products and contact a Brock dealer in your area.