On farm storage may seem like an investment only to consider in years of strong profitability –years that you can “afford” to make the purchase. However, on farm grain storage may be an investment that you cannot “afford” to go without, particularly in the lean years.
Let’s talk how on farm storage can impact your bottom line and benefit your operation year after year.
Extend your grain-marketing window
By storing your grain you are not going to be improving the quality of the grain, but you will likely be improving the value of the grain. Without on farm storage, you are subject to the whims of the marketplace on the particular day you harvest. You are forced to accept the market price each time one of your trucks drives to the elevator. Storing your grain gives you the option to sell at the peak of the market.
When is the peak of the market? A historical price pattern indicates that corn peaks in the spring and hits a low in October when the majority of the corn is harvested. With on farm grain storage, you can extend your marketing window into the spring. The University of Nebraska Extension, as with most Extensions, advises farmers to sign up for their local elevator’s text message services to get real time cash prices.
Take advantage of the futures market
Selling your grain in the spring is just one step that can improve your bottom line. On farm grain storage gives you the opportunity to study the futures market and really take advantage of trends.
As a farmer, you love to grow grain, but do you love to market your grain? Knowing your basis—the difference between the local price and the price on the board is the first step in taking advantage of the futures market.
Matt Roberts of Kernmantle Investment Group advises farmers to understand basis and carry in the marketplace. There are profits to be made he says, if the right infrastructure is in place. If you have on farm grain storage, you have the infrastructure needed to succeed.
Keeps your machinery moving
Improving your bottom line doesn’t just mean improving the price of your grain. Often it means reducing costs. An inefficiency that on farm storage can improve on is equipment harvest slow down. When harvest equipment slows down or stops because grain trucks are waiting at the elevator, your productivity drops. With a limited number of good harvest days, a drop in productivity could lead to quality issues in the grain and increased harvest costs – both can impact your bottom line in a big way.
Adequate on-site grain storage can put an end to these woes. If you plan correctly, it can keep your machinery moving for years to come. Experts say to plan for at least 20% more storage than you first estimate, considering improved yields on your farm.
With the right equipment you can start your harvest sooner. Effective Grain Storage can protect your crop from infestations, rot, and harvest schedule issues that can arise when depending only on mother nature to dry the grain in the field. The right equipment isn’t just a bin; modernized farm storage includes at a minimum complete aeration. Depending on the crop, and location, dedicated drying equipment may also be used. Effective storage systems beyond simple storage bins will protect your investment and improve your bottom line.
Getting the Right Help
Storing your grain doesn’t come without costs both direct and indirect. To decide if on-farm storage is the right option for your farm, speak with the experts at Adams Grain Bins. They can help you learn about and design a storage system to make your life easier and more profitable.