" /> Grain Storage: What to Do When You Need More Than You Have

As harvest season ends, it’s time to start making decisions about grain storage. Storage needs will depend on one thing, your yields. Was it an especially fruitful year or did your crops end up underdelivering?

The answer to this question may have some farmers struggling to store while others are losing out on profits. Fortunately, there is a solution that benefits farmers in either situation – whether they’re over or under the mark.

When farmers find themselves with an overabundance of yields, they should start looking for grain bin rentals nearby. Alternatively, if farmers didn’t have the year they expected, they can attempt to recoup some of their loss by renting out their empty grain bins.

Grain Bin Rentals: On-farm Grain Storage and Commercial Grain Storage

There are two ways in which a farmer can rent grain storage. The best choice, if applicable would be to rent from a nearby neighbor. Transporting grain can be time consuming, laborious, and dependent on weather conditions. For these reasons, farmers want their grain storage to be as close to their fields as possible.

The second option is to rent from a commercial elevator. This is the more common choice because renting from neighbors is usually conditional. They must be able to provide the space and that’s not always a guarantee. If they met their yield goals, it’s unlikely they have any space to offer.

Commercial Grain Storage Versus On-Farm Grain Storage

There are four main draws to commercial grain storage rentals.

  • When they already have established rental practices, it feels safer.
  • When commercial rentals have set prices based on industry standards, it feels regulated.
  • Many provide a portion of insurance protection and have some level of labor and management functions.
  • They provide convenient and easy to use loading and unloading facilities.

The downside to commercial rentals is location. There are no guarantees farmers will be able to find a commercial rental nearby. That can prove problematic when transporting grain during a temperamental weather season. They also tend to be more costly than on-farm grain storage due to the perks and coverage that are offered.

Even with the ease of commercial grain storage, it is still preferable to secure on-farm grain storage when possible. The primary reasons are value and convenience. On-farm storage rates are typically lower than commercial storage facilities. A next-door neighbor with available grain storage couldn’t be more convenient.

However, there can also be huge downsides to this option because the renter assumes most, if not all the risk. That is, the risk of loss of grain. The renter is usually responsible for all management and labor functions. Additionally, the overall upkeep and the loading and unloading facilities may be subpar.

Grain Storage Rentals: Five Key Things a Renter Should Know

Regardless of which option a renter chooses, there are five key requirements that should be identified before entering a lease.

  • First is size, is the storage facility large enough for the quantity of grain? Or is it too large to be used economically?
  • Second is use, does the facility and equipment meet the needs for a grain farmer?
  • Third is location, how far away are the facilities from the farmers operation? Are the transportation costs too high? Additionally, how far are the facilities from the owner’s main operation? There are security risks if the facility is located somewhere, it cannot be easily observed.
  • Fourth is convenience, is the facility and equipment easy to use and efficient? Can grain be easily loaded and unloaded? Does the building have features that increase the safety of the grain? An example of this would be a bin outfitted with a GrainTRAC temperature monitoring system. This system uses temperature cables outfitted with sensors that track your grain health. The best part, these systems work remotely. This means farmers can monitor their grain temperature in real time without having to be on site.
  • Fifth is obsolescence, are the equipment and facility up to date with current technology? Are replacement parts easy to get? Does it meet environmental standards? Will older equipment cost you in the long run?

Renting Grain Storage: Two Final Considerations

First, you’ll want to consider if the equipment and building are in good, working condition? Will repairs be needed? Who is responsible for paying for maintenance and repairs? Will operating costs be overly costly? What about spoilage related to poor maintenance or machine function, who is responsible for that?

Second, is alternatives. Could the same facilities or services be obtained elsewhere at a better price? Is it difficult to find grain storage rentals in the area? If so, the costs might be higher or there could be many applicants to contend with.

It’s important to note that establishing rental rates can be difficult. You may have a limited market depending on your location. For this reason, William Edwards, a retired extension economist and author created some useful guidelines for computing storage rental rates.

Additionally, the North Central Farm Management Extension committee conducted a farm building rental rate survey. It included 15 states and The USDA National Institute of Food and Agriculture (NIFA). The results from the survey established a general baseline of rental costs of various farm facilities and equipment. Though the survey is somewhat dated, we encourage people to check out these resources before looking into grain storage rentals.

Remember, if you’re renting private on-farm grain storage, check to see that the bins are fitted with a remote temperature monitoring system. That way, you can easily keep track of your grain health.

For more information about grain temperature monitoring, ask here, live chat with us here, or call us at 1 800 438 8367.

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