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Illinois anticipates record grain storage applications

 

By TIM ALEXANDER

Illinois Correspondent

 

SPRINGFIELD, Ill. — The abundant Illinois harvest has propelled the number of grain storage facility temporary or emergency option applications to an anticipated all-time high, according to Stuart Sellinger, Illinois Department of Agriculture (IDA) Bureau of Warehouses chief.

"As of Oct. 21, temporary storage applied for and/or approved was at 107.421 million bushels," primarily for corn, Sellinger said. "On emergency, applied for and/or approved bushels are currently at 3.155 million."

Disparities between temporary and emergency grain storage options, according to the warehouse chief, are vast. "Temporary storage requires a solid base such as asphalt, concrete or packed limestone, (along with) rigid sidewalls and a tarp covering the grain. Emergency storage is basically ground piling; it is anything that doesn’t meet the criteria of temporary storage."

Some corn growers think the anticipated harvest deluge of grain could have been better planned for by government agencies in order to more effectively address storage and transportation issues. Gary Hudson, president of the Illinois Corn Growers Assoc., wonders where all the grain will go and if growers will ever see breakeven prices again.

"What I really need to know as a corn farmer is when all these unnecessary policies, regulations and rules are going to be dealt with,’’ Hudson asked, in an ICGA news release. "At this point we are looking at barriers to market access and we can’t afford that with 200 bushels-per-acre corn yields."

Sellinger confirmed as harvest continues, IDA expects the number of applications for both temporary and emergency storage permits to eclipse previous submissions.

"The delayed harvest from rains caused a lull, but it has given licensees an opportunity to handle the grain that they previously received, to get that grain positioned or on the supply chain," he said. "But with the weather straightening out, I expect another crush coming."

That anticipated crush, combined with regulatory and political hurdles, according to Hudson, means corn growers will face challenges finding immediate future markets for their products. "Given the large corn harvest, we know that it’s important to build new demand for our corn, but we also know that demand exists that we just can’t access for a variety of reasons," he said.

Weather-related delays to the Illinois crop harvest might work in favor of overall storage issues, however, according to University of Illinois ag economist Darrel Good. He claims a rapid rate of market consumption, combined with weather delays, may mean overall storage issues could be less than feared this year.

"It is likely that consumption of field grains, wheat and soybeans during the period from September 1 through October 16 totaled about 3.2 billion bushels, or about 69.6 bushels per day. That pace continues so that nearly 16 percent of the total (estimated) crop supply has already been consumed," Good projected online at the farmdoc blog.

"That magnitude of consumption has substantially reduced the requirement for crop storage capacity, resulting in a modest strengthening of the corn and soybean basis in many areas."

Good cautioned while overall crop storage issues may be less severe than expected, regional issues may persist. Still, Sellinger feels a record number of storage applications are forthcoming. "With the record harvest, we are expecting a number of applications substantially above any we’ve had before," he said.

"I just hope that as folks are heading to the polls in November that they think about these piles of corn and determine which candidate will do the most to eliminate barriers to market access," Hudson said.

10/29/2014