The glint of new corrugated steel bins and dryers will continue to transform the agricultural landscape as new grain-handling facilities take up residence on more farms.
Bin and dryer manufacturers had wondered whether the extensive 2010 building boom would cool down in 2011. But surprisingly brisk early orders have some manufacturers wondering whether 2011 could match 2010’s record sales.
“Two thousand ten was a record-setting year, and 2011 has been gangbuster so far, as well,” says John Tuttle, district sales manager for Brock Grain Systems in Iowa, northern Illinois and Wisconsin. “Whether it is going to continue at that pace into the building season, I’m not sure.”
Ed Benson, general sales manager for Chief Industries grain bins, tells pretty much the same story: “In one word, business is great. With current commodity prices, the demand for grain storage both on the farm and commercial is outstanding. We expect a large increase from 2010 in 2011.”
Although bin sales are expected to continue to be brisk, dryer sales, although still strong, appear to be backing off from 2010’s torrid pace.
“In 2010, a lot of the interest focused on drying equipment because of the wet harvest in 2009, and capacity was tight,” says Scott Becker, farm storage product manager for Grain Systems Inc. (GSI). “The focus this year has shifted more to storage and materials-handling equipment. We’re still getting some interest in dryers, more than we expected after the exceptional year we had in 2010.”
Bin and dryer manufacturers say that many buyers are dramatically upgrading their facilities. Upgrades aren’t just about bigger bins. Many operations are investing in completely new or significantly reconfigured facilities that streamline the entire grain-handling, drying and storage system to mimic the efficiency of large commercial grain-handling setups.
“Many farmers are interested in going to centralized systems with higher-capacity materials-handling equipment,” Becker says. “Having everything in one location makes management easier.”
This trend, which has been cash-flowed by high commodity prices, reflects a growing awareness that existing on-farm facilities often are outmoded, undersized and in the wrong place to efficiently handle today’s larger harvests.
In many cases, smaller bins built during the last big bin-building run-up in the 1970s are being taken out of commission. Large existing bins often are being converted for bean storage, while new corn-handling facilities are built from the ground up.
“Harvest capacities have increased dramatically, so the bottleneck is at the grain drying/storage site,” says Jeff Cruzen, a regional sales manager for Mathews Company, which manufactures grain dryers. “Farmers are addressing this by updating their dryers and grain-handling systems.”
Speed, automation, and traffic flow
“Along with sizes increasing, there is a lot more focus on speed, automation, and traffic flow,” Tuttle says. “Many farmers today have their own semis, which are a lot more difficult to maneuver than small trucks or wagons. The progressive guys are saying we either are going to a brand-new site, or clear things away from an existing site to improve flow.”
Designs with receiving pits with bucket elevators for quick unloading of hopper-bottom trucks are common. So are overhead load-out bins that can fill a semitrailer in two or three minutes.
“It is really a commercial-style setup,” Tuttle says. “I have been encouraged by the amount of investment producers are willing to make in these systems. But when growers recognize the profit potential for controlling their grain, they feel they can afford to build a system that is easier to use, quicker and safer.”
To maximize grain quality and to reduce the risk of grain going out of condition, new systems also often include sophisticated stored grain monitoring and control packages, such as those offered by AgriDry, Integris USA, and Intelliair.
Tower dryer sales heat up
Although traditional basket-style grain dryers continue to be an important consideration for growers upgrading drying capabilities, farm-sized modular tower dryers increasingly are the dryer of choice, according to Becker and Cruzen. Sales of tower dryers have strengthened in part because they are 25 to 30% more efficient than traditional dryers, Becker says. Sales also have been spurred by USDA Rural Energy for America Program (REAP) funding, which offers grants and guaranteed loans of up to 25% each for adoption of energy-efficient technologies. The program, which is administered by the USDA Farm Service Agency, is scheduled to end in 2012.
Many larger operators stung by 2009’s wet harvest shifted to larger-capacity towers to continuously dry and cool grain and avoid in-bin cooling, Cruzen adds. “Dry-and-cool systems are much easier to manage because your corn is coming out relatively cool and there is less heat and humidity to remove after the grain leaves the dryer,” he says.
Regardless of dryer design, many buyers are opting for sophisticated dryer-monitoring packages with touch-screen controls and interfaces that allow dryers to be monitored via the Internet. Internet capability also allows support and service personnel to help diagnose dryer breakdowns from afar.
Prices heat up, too
List prices for both bins and dryers are up in 2011 from 2010, with more price hikes likely in the future. While dryer prices are up modestly, many bin manufacturers have bumped prices 20% or more since last fall in response to steel price hikes of about 40%, according to Benson of Chief Industries.
“With steel such a major part of the cost of a bin, we are in the position of having to change our prices right along with the price of steel,” adds Tuttle of Brock Grain Systems. “But the reality is, we struggle to maintain our margins because it is hard to pass along such large price increases in real time.”
Despite higher prices, manufacturers expect the bin-building boom to continue beyond 2011. “If what the seed corn industry is telling us about expected yield increases is right, we’ll continue to need more storage,” Benson says.