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Don’t Bring Your Grain Here

November 5, 2009
By: Sara Schafer, Farm Journal Media Business and Crops Editor
 
 

Linda H. Smith, Top Producer Executive Editor
 
Over the past three weeks, a growing number of elevators have been forced to turn away high-moisture loads, let the delivery lines grow to unfortunate lines and/or go to alternate-day delivery, says J.C. Hoyt of CashGrainBids.com. "Their dryers simply can't keep up.” Some who have pushed temperatures and speed in an effort to take in more corn saw it "come out of the dryer as ground feed.”
 
Although Cargill AgHorizons is by no means the only elevator chain involved, they provide good perspective. The following is a synopsis based on comments from several regional managers in the Midwest: "This season's wet harvest is an issue that goes well beyond any one grain company or state. In fact, we are hearing that many elevators -- not only in Illinois but throughout the region, including Indiana, Iowa, Minnesota, and Nebraska-- are facing or will be facing delivery challenges due to the wet weather's impact on harvest, with many elevators accepting deliveries on considerably shortened hours and days to manage the backlog of grain drying operations, as the corn is extremely wet and takes much more time to dry. The entire grain industry in this area is struggling to keep up with drying capacity this year.
 
"At Cargill, we are not turning away producers' grain deliveries en masse, but we are being forced to limit unload hours and place maximum moisture limits at many locations so that our dryers can keep pace with demand. A few of our locations are currently open only every other day, or some variation thereof.
 
"From an Illinois perspective, of the 13 Cargill AgHorizons' grain elevators we're currently operating in the central Illinois farm service region, only three are completely open for deliveries of wet corn currently. The other are open for dry corn and soybeans only, or are operating with reduced hours in which we accept wet corn to allow drying activities to catch up. We understand producers' frustration, which is running high in some areas.
 
"In our northern Illinois River region, we haven't experienced any issues with wet corn yet, as harvest is just starting, and not a lot of corn comes to the river terminals during harvest time. On the soybean side, we have had to refuse some soybeans when moisture levels did not meet specs or there were other quality issues associated with the load.”

As a result, basis is beginning to weaken in much of the Corn Belt

 

(click to enlarge)

(click to enlarge)

"Look for basis to weaken further in the next two weeks as the bulk of harvest is still before us,” says Hoyt.

 
"This is going to be a prolonged harvest, so those who do store may have to wait longer than usual to see price improvement,” he says. "And the agronomic effects will carry over into 2010, as well—requiring more attention to maintain acceptable quality of stored grain and pushing tillage and fertilizer application into spring for some.”
 

 
You can e-mail Linda Smith at lsmith@farmjournal.com.

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