Markets

Grain bags help shoulder load in bumper harvest

Liz Wells, November 27, 2020

Grain bags were in hot demand of this harvest. Photo: Agri Novatex

AN UNPRECEDENTED level of on-farm grain storage has been deployed in the bumper New South Wales harvest now under way, with grain bags and bunkers adding capacity to permanent storage.

Combined with silos and sheds, they have allowed growers to squirrel away a portion of their wheat and barley straight from the header, and their strategy of storing off-spec grain has made high quality a hallmark of deliveries to date.

Grower preparedness has come in response to the La Niña which pointed to a wet harvest, limited available labour because of COVID’s impact on international travel, and the drive to market effectively what for many is their first sizeable crop since 2016.

Nevertire grower Tony Quigley first used grain bags in 2010, and is this year bagging the small amount of frost-affected wheat he has harvested.

While the large amount of high-quality milling wheat has collapsed its premium over APW-type wheat, the small amount of general purpose (GP) and stockfeed wheats being delivered are copping hefty discounts.

“Growers are storing anything off-spec because the prices for anything below APW are not good enough to warrant putting into the system,” Mr Quigley said.

Remembering the impact of drought on the local grain market in 2017-19, growers are happy to hold off-spec grades to use with their own livestock should the season cut out on them, or speculate on price rallies in coming months.

“It’s far too valuable to put into the supply chain as GP.”

Like many growers, Mr Quigley stocked up on grain bags because of big yield prospects, and the forecast for a wetter-than-normal spring.

“We’ve done everything to prepare for a wet harvest and we didn’t get one.”

However, some growers did, and bags have played a major role in getting grain off and stored safely ahead of storms and showers, while bulk handlers have concurrently been receiving massive volumes of grain being housed in permanent storages or under tarps in bunkers.

Alternative to warehousing

Augmented on-farm storage allows growers to hold grain rather than sell into a falling market to solve short-term logistics problems.

It means traders and consumers are needing to show growers strong prices to get them to part with wheat and barley this harvest, with canola and early harvested pulses the most popular up-front cash cows.

Temporary on-farm storage of cereals has therefore become an attractive option to warehousing.

Mr Quigley said the cost of road freight plus the up-front cost of warehousing locally equated to around $30/t, while grain bags worked out at around $4 per tonne.

Grain bags must be filled with an inloader, or bagger, and emptied with an outloader, both specialist machines, which jointly work out at about $4/t to operate.

New inloaders cost close to $30,000 and most growers who use grain bags have their own, while outloaders at a minimum $40,000 can be shared among neighbours, or hired.

Agriwest Parkes agronomist and Manildra grower Luke Wood said logistics was pushing the interest in grain bags.

“We use it as a bit of a backup to keep the headers rolling,” Mr Wood said.

The family has its own inloader but hires an outloader, and usually stores grain in bags for a maximum two or three months.

“We try not to store it too long”.

“Compared with storage in a silo, we don’t have to use any grain protectant, which will cost you $3-$4/t.”

However, permanent storage is their long-term goal.

“That comes down to cash flow.”

Long history

Grain bags have been used in Australia since the 1990s, and are available through a range of suppliers.

One is Agri Novatex, which sells GrainBAG units of up to 120 metres in length.

Agri Novitex customer relationship manager western zone Neil McAlpine is based near Perth, and was introduced to grain bags when based in Swan Hill in the early 2000s.

Those bags came from Argentina, where Mr McAlpine said they have played a major role for decades.

“The grain bag business is nowhere near as big here as it is in Argentina.

“They don’t have the bulk handlers we have, and they put grain in bags for stockfeed.”

He said while the WA harvest was not a bumper one, and its domestic market lacked the depth and volume of the eastern Australian one, this year had still been a big one for grain bags in the west.

“It helps growers manage their transport.”

He said barley appeared to be going into bags for marketing reasons, namely the hope that prices rallied post-harvest.

“If they put their grain away for a few months after harvest, the price usually goes up.

“There’s quite a bit of barley going into bags because of the Chinese situation.”

“Most people selling grain bags this year would have had almost a record year.”

Eastern sales boom

Delta Ag is a stockist of Plastag bags, and Delta procurement animal health and general merchandise Sam Simmons estimated the company has sold more than triple the normal number of grain bags.

“It’s a big harvest, and grain receival points are struggling to keep up, and on the back of drought, people want to store that grain as quickly as they can,” Mr Simmons said.

“It appears that grain bags are the go-to for many people.

“It’s all about logistics; if the header has to wait for trucks and chaser bins, that’s what slows you down.”

Mr Simmons said the call for grain bags started in July.

“That was when people could see it was going to be a big harvest, and the fear of a wet harvest made silo bags really attractive.”

Link Brokering principal Dion Costigan has been using grain bags since 2007 and is an agent for GrainFlex bags.

His 2020 supply sold out in August-September.

Yet another bumper Victorian harvest, on top of what looks like a record crop for NSW, will max out on and off-farm permanent storage and temporary public storage too.

“There are not going to be enough bunker sites. “

“That’s why bags are so important this year.”

Mr Costigan said bags sometimes paid their way by allowing growers selling on deferred delivery to distant buyers to net up to $25/t above local options.

He said the 75m bags he sells can hold 240-250t of wheat and 220-230t barley.

Risks to consider

Temporary storage of grain is not without risk, and Queensland Department of Agriculture and Fisheries senior development agronomist, post-harvest grain protection Philip Burrill has listed some points to keep in mind at harvest:

For grain bags, aim to store barley and wheat slightly drier at less than 12pc moisture content to help reduce the risk of grain-mould damage and pest infestations.

Early harvested grain with moisture at 14-17pc should be initially stored in silo storages with aeration cooling fans running, and dried or blended with dry grain over the next three to five weeks.

Location matters

If possible, aim to have the majority of grain bags and bunkers in a central location with good site drainage to handle storm rain.  All-weather truck access is always beneficial for inloading and outloading. Leave enough space around individual grain bags and bunkers to allow for truck and equipment movement during outturn.

A central location also simplifies regular grain bag and bunker inspections, which should be done two or three times per week.

Holes in bags caused by wildlife or birds need to be repaired quickly, or others will quickly follow when they figure out your grain can be their feed and serious damage starts occurring.

Good bags, good investment

Purchase good-quality grain bags from a company with a proven reputation.  Poor-quality bags damage easily and may split open prematurely, and will cost you time, money and many frustrations in a few months’ time.

Good site drainage, appropriate soil types and a compacted surface will help to minimise the risk of full bags sinking into the soil over time and becoming difficult to outload.

Ensure you have the required skills, or good advice close at hand, when operating bag-filling machinery at harvest time.  A straight bag line and evenly filled bags makes it easier when outloading.

Aim to minimise the folds in the plastic at the finish end of bags. Mice find protection in folds and make holes that allow storm rain entry to bags. Holes lead to moulds and grain damage, and encourage storage pest infestation.

Further reading: https://groundcover.grdc.com.au/grain-storage/management/temporary-grain-storage-tips

 

 

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