Western Australian grain growers thinking about future investments into on-farm grain storage can weigh up the economics with the help of a new guide.
The Grains Research and Development Corporation (GRDC) publication Economics of On-Farm Grain Storage contains all the relevant questions and equations farmers need to calculate whether grain storage is right for their farm business.
ProAdvice consultant Chris Warrick, who leads the GRDC Grain Storage Extension Project, said the guide had been well received by growers attending recent grain storage economics workshops in WA.
He said the guide would help farmers determine if expansion of on-farm grain storage was justified for their situation, or potentially a costly mistake.
“To make a sound financial decision, we need to compare the expected returns from grain storage compared with expected returns from other farm business investments, such has more land, a chaser bin, a wider boomspray, a second truck or paying off debt,” Mr Warrick said.
“Economics of On-Farm Grain Storage contains a step-by-step template to help farmers work out the potential financial gains such as marketing, harvest timeliness and freight savings from carting grain direct to port after harvest.
“The template also contains calculations to work out the fixed costs of on-farm storage such as the annualised capital costs of the infrastructure, site works, concrete and equipment, as well as the opportunity cost of capital.
“While it’s difficult to put an exact dollar value on each of the potential benefits and costs, a calculated estimate will determine if it’s worth a more thorough investigation.
“Evidently the financial implications are not the only factor to consider in deciding between investment options.
“Labour availability, knowledge and area of interest will also play a part in the success or otherwise of the storage.”
Economics of On-Farm Grain Storage is available on the GRDC website at www.grdc.com.au/GRDC-Guide-OnFarmStorageEconomics or on the GRDC Stored Grain Information Hub www.storedgrain.com.au
Mr Warrick said WA growers interested in having a grain storage workshop held in their area early in 2014 could express their interest by contacting him on 0427 247 476 or firstname.lastname@example.org.
Topics that can be covered in workshops include economics, aeration, insect pest control or grain hygiene.
Caption: A new GRDC guide can help farmers determine if expansion of on-farm grain storage is justified for their situation or potentially a costly mistake. Photo by Ben White, Kondinin Group.
Media releases and other media products can be found at www.grdc.com.au/media-news
Chris Warrick, ProAdvice
0427 247 476
Natalie Lee, Cox Inall Communications
08 9864 2034, 0427 189 827
GRDC Project Code