By Mary Kennedy
DTN Cash Grains Analyst
In its Nov. 10 Crop Production report, USDA raised its production estimate for U.S. corn, with Minnesota showing one of the larger gains. The state will produce an estimated 1.45 billion bushels of corn this year, 5% higher than the record set in 2012. Average yields are projected at 187 bushels per acre, 31 bushels higher than last fall and 10 bushels higher than the record set in 2010.
For confirmation of this year's bumper crop, just ask Tyler Sunderman, owner of Patriot Grain in Cleveland, Minnesota, a small town east of St. Peter. He and his father have owned the 425,000-bushel elevator since 2012 which services producers in the area.
Sunderman told DTN that when the corn price rallied in July, his customers sold old-crop corn and contracted new crop as well. By the time harvest was in full swing this fall, Sunderman ran out of bin space and had to pile corn on the ground. He told DTN that his father always wanted to pile corn, and now he could "check it off his bucket list."
Patriot Grain has two 100,000-bushel piles that consist of high-test-weight corn with average moisture of 15%. Sunderman said he didn't see any corn below 57 pounds, which would help account for the average yield of 210 bpa in his area. He does have fans running on both piles, and when it came time to tarp the piles, he enlisted the help of the Le Sueur-Henderson wrestling team. He said it was quite a sight watching the boys crawling all over the pile pulling the tarp as they moved.
While a tarped pile of dry corn is good temporary storage, it's not without some spoilage in the end. Chad Schmidt, a 14-year veteran of the grain industry and former grain manager at a Mississippi River terminal, told DTN that the main reason for running a fan is "to keep the tarp sucked into the pile and less susceptible to wind pulling it off the pile." Schmidt piled 1.2 million bushels of corn at the terminal in 2010 and held it all winter until the river opened up in the spring."
He added that it is not a cheap investment to pile corn and "costs such as interest, tarps, the labor cost to pile and pick up; all need to be figured into the final price you want to net."
"The first key to storing corn outside is using good-quality corn above 56 pounds. Then, have a good base that is crowned to keep rain and melted snow from seeping under the tarp and walls," Schmidt said. "The base is peaked in the center both length- and width-wise so the water would run away from the pile. It was a challenge to get our pile half full and tarped before rain."
Schmidt added, "Seepage would be the second biggest source of spoilage. Then, hope the weather is dry from when the pile goes down until it is picked up. It did seem that having too many fans will pull moisture into the pile. Usually, the most spoilage occurs is around the aeration tube inside the pile, where the moisture has collected."
FAN OF THE BASIS
Sunderman, who with his family farms 5,200 acres of corn and soybeans, told DTN that his corn is all hedged in the futures, but he is a "fan of the basis" now. So far, he has been doing well as the corn basis has been getting stronger this fall. Since the start of the corn harvest in late September, the weekly DTN National Average basis has strengthened by 11 cents as of the third week of November.
Since Patriot Grain has no rail service, Sunderman relies completely on trucks to move his corn. He said he usually feeds two ethanol plants south of him and also has a contract with a large dairy to provide 11,000 bushels of corn for feed each week.
His plan right now is to get rid of the pile after the first of the year. He said when he opens a pile, he will keep the trucks moving until the pile is off the ground to avoid spoilage.
Mary Kennedy can be reached at mary.kennedy@dtn.com
Follow Mary Kennedy on Twitter @MaryCKenn
(AG/SK)
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