Bountiful crops have farmers scrambling for storage
We all have regrets.
For Rick Hoogewoonink, it’s that he didn’t order more grain bags this year.
His Clyde-based Amity Welding and Fabricating Inc. and Amity Ag-Enterprises Inc., which supply the big plastic storage bags to customers from Red Deer north, have sold some 2,000 units this year. That’s a 200 per cent increase over 2012, and the most Hoogewoonink has moved during his 21 years in the business.
The number could have been higher.
“We are right out of stock,” said Hoogewoonink, who grew up in Red Deer.
Keith Jones, manager of market strategy for grains and oilseeds with UFA Co-op Ltd., said UFA’s farm supply stores have also experienced a run on grain bags, as well as grain baggers, bins and bin rings.
“It’s the biggest grain storage year for quite a few years, for sure,” said Jones. “There’s no question.”
What’s got farmers scrambling to find places to keep their grain and oilseeds is one of the biggest crops in years.
Last week, Agriculture Financial Services Corp. (AFSC) reported that yields in Central Alberta were 20 to 30 per cent above the five-year average. And farmers across the province were enjoying similar results.
“Most guys that we talk to, when you ask them about yields they’re usually pretty happy to tell you about them,” said Mark Cutts, a crop specialist with Alberta Agriculture and Rural Development’s Ag Info Centre in Stettler. “So that tells you that they’re good.”
The bountiful results appear to apply to all crops, added Cutts, who has also been hearing from producers who have maxed out their bin space.
“Quite a few guys have moved to the grain bags for storage.”
Hoogewoonink said 80 per cent of the bags his companies sell hold between 12,000 and 15,000 bushels each. He noted that some farmers are turning to other alternatives.
“A lot of guys are putting bales in a circular fashion and then filling that with grain and covering it with a silage cover.”
Cutts estimated that harvesting in Central Alberta was more than 75 per cent complete when this week’s cool, wet weather halted combining. With Environment Canada forecasting a return to sunny conditions by Friday, he’s optimistic farmers will soon return to their fields. If that’s the case, crop quality shouldn’t suffer.
Right now, that quality looks very good. AFSC rated 90 per cent of the spring wheat, 92 per cent of the barley and 96 per cent of the canola in Central Alberta in the top two grades.
Prices have come down since last year, a consequence of the high yields and increased output of competing crops south of the border, like corn and soybeans. But the volumes Alberta farmers are enjoying should more than make up for the reduced values.
“If prices are down and yields are up, the math is probably still pretty favourable for most producers,” said Cutts.
He said the warm weather in recent weeks had a big impact on the 2013 crop — allowing it to mature quickly and giving producers a relatively uninterrupted harvest period.
“Once harvest started up, until basically this week, if you had something to combine the weather hasn’t delayed that one little bit.”
Hoogewoonink is happy for his customers, although he wishes he had more grain bags to offer them. But, a shortage of product beats the alternative.
“We’ve had years where we’ve been stuck with a lot of inventory.”
Jones foresees another issue that could arise as a result of the big harvest.
“It’s going to put lots and lots of pressure on the grain transportation system, for sure,” he said. “But in the short term, the good news is there’s lots and lots of product out there for farmers and ranchers to sell.”