How Does it Work: Grain Elevators

Farmers plant corn in their field in late April and May and in the fall corn is harvested by a grain combine. Once the corn is harvested (usually in September, October, or November) it is dried and stored on a farm or in a grain elevator and from there is shipped to mills and refineries. So, how does a grain elevator work?

Combines harvest grain out of the field and transfer it to a grain cart or directly into a truck that can carry the crop to the grain elevator. Grain elevators are located near railways or waterways to accommodate shipping the grain out after being processed. Elevators are generally in small rural areas which is less distance for the farmer to haul the grain. It is easy to recognize the grain elevator. 1It is sometimes the tallest building in town, between 70 to 120 feet tall!

The truck carrying the grain pulls into the local grain elevator and then stops on the scale at the elevator to be weighed. The operator takes a sample of the grain to test for the weight, moisture content and to check for any foreign materials present. Foreign materials could consist of chewed up corn, stalks, weeds or trash. To store grain, the moisture content needs to be around 15% or the grain might mold at higher percentages or be too dry at lower percentages. If the grain is too wet farmers have to pay to have it dried at the elevator. Either one of these scenarios will lower the cost per bushel.

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The grain is then dumped from the truck to a work floor of the elevator. The work floor is an open, slatted floor where the grain dumps into pit and will then travel on a continuous belt that has buckets attached to scoop up the grain and then deposits it into silos. This bucket system elevates the grain taking it from the floor to the top of the silo (thus the whole facility is called a grain elevator). The empty truck will drive back to the scale to weigh the truck again. This will tell the elevator operator how much corn was unloaded.

The farmer will be given a receipt called a weight or scale ticket. This ticket will tell the number of bushels calculated as being brought to the elevator. It is important for the  farmer to know the weight of the grain that was dumped. Corn is sold by the bushel and the standard weight of a bushel is 56 pounds. It is the measurement for weight when buying or selling crops. The ticket will be a record of delivery for the farmer. The scale ticket will show the date, quantity, kind of grain and quality of the grain being delivered. It will also tell if the grain is to be sold or stored.

Grain elevators were created to hold crops being purchased or available for resale, and 7to help with the problem of storing grain. The essential function of storage is to protect the grain from the elements and allow for it to be stored and tracked for quality and temperature. The inside building houses a vertical storage with bins that allows for easy transport of the grain. Proper storage is of utmost importance. If the crop is left in the field it can have reduced return on investment due to insects, mold and birds or rodents. Crops must be clean. The moisture content is a major factor for storing safely. High moisture can lead to mold and fungus. As grains reach maturity the moisture content diminishes.

Storage of grain will allow flexibility to the farmer to use marketing and possibly receive season price increases. There is a cost incurred for storing grains, so the farmer must decide based on storage capacity and expected returns after storage. If selling the crop later for a price that exceeds the current selling price is the better decision, the farmer will choose to store the grain. Proper use of storage will potentially increase the income cost for the grain. However, the farmer will need to take into consideration storage costs, which can include facility cost, interest on grain inventory, extra drying of the grain, shrinkage of the grain and handling fees.

Farmers have choices on how to sell their grain. They can choose to do a forward contract and sell to a grain dealer at any time. A forward contract allows the farmer to know exact price, exact quantity and date of delivery. The downside is if prices go up, the farmer is already locked into the forward contract. If the farmer does choose to store the grain and sell later, he can sell to ethanol plants, bio-diesel plants or to livestock feed producers. The farmer will negotiate prices and will choose to sell throughout the year. Keeping in mind the cost to store and the importance of keeping the grain suitable for purchase.

When the grain is sold it may leave the   elevator it may be into a rail car, truck or barge. Gravity is usually used to load grains from bins to the loading station. The process of loading and a reversal of the process for unloading. The empty truck pulls onto the scales and is weighed. The truck will pull under the spout and the grain will load back into the truck. Both the trucker and the elevator operator watch the gauges to know when to shut off the grain. The truck will pull back onto the scales to get an accurate weight and then will deliver the load to the destination.

There is so much more to agriculture. The process of getting the grain to and from the elevator is full of important steps, none of which can be omitted. I realize that the job of farming has so many aspects that go unnoticed, but are vital to the result which is food, fuel and fiber for the hungry world. I send a huge thank you to the Farmers!

– Sheri

 

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