Harvest Now or Harvest Later?
Oct 28, 2019
For the second year in a row, we here on the Northern Plains experienced an early October blizzard, which brings up a lot of questions on how to go about harvesting this year’s corn crop.
The answer will be different for each grower, depending on variables such as hybrid selection, drying capabilities, and an individual’s appetite for risk. Below we will examine a few of these factors and discuss how to best weigh them into your decision.
The Current Situation
- We have a large portion of the ND corn crop that did not reach black layer prior to freezing temps in the October 10-12 time frame. According to the USDA, only 22% of the crop reached maturity prior to freezing.
- The majority of the corn acres in ND have excessive soil moisture, making field work nearly impossible.
Based on this information, we can assume:
- The majority of the corn in the field is going to be high moisture (>30%) and is lower on test weight than desired (<54 lbs.).
- Harvest won’t be able to start until fields dry or the ground freezes.
Additionally, based on today’s date, any improvement in field conditions will most likely be from freezing solid rather than actual drying of the soil.
What do we do now?
For the sake of having an example to work off of, we will use the following parameters of a field on October 15:
✔️170 bushels/acre yield
✔️49 lb. test weight
✔️Current cash price for the grain in the field is $3.40/bushel
So, the next question is how long does it take this corn to dry down to a point that it can be harvested and dried in a respectable manner?
Based on the chart below, created by NDSU’s Kenneth Hellevang, we shouldn’t expect to get in the field before the first part of December, and that’s IF Mother Nature cooperates.
The chart tells us that the equilibrium moisture content (EMC) corn will be able to dry to in the field based on the month and its average temperatures and humidity. The chart also factors in the potential evapotranspiration rate (PET) which is the amount of moisture lost to the atmosphere for each month.
Note that for each inch of PET, corn in the field will lose about 4% grain moisture.
What does it mean?
- Once we get into the winter months the rate at which corn dries in the field is very slow.
- With average winter weather, corn will not be able to dry to much below 20% moisture prior to spring.
If we look back at our example field and average natural drying, we could expect that by December 1 the moisture of the grain will be roughly 27-28%.
To Harvest or Delay: Risks, Rewards, and Financials
To make this decision we will need to look at some risks and rewards for some of the harvest windows. For the sake of time, we will look at December harvest, March harvest, and May/June harvest.
|High grain moisture requires drying||Crop is harvested|
|Creation of BCFM from mechanical drying||Grain can be sold for cash flow|
|Test weight is still low||Less standing crop to catch snow|
|Greater risk of drier fires||Harvested prior to December 10 insurance coverage end date|
|Less risk of loss due to weather events|
|Ground will be frozen to allow easy travel.|
|Loss of grain from weather events||Grain dries on its own in the field|
|Heavy snow fall could limit access to fields||Test weight will increase|
|Lack of ability to sell grain for cash flow||Less mechanical drying needed|
|Losses are not insured||Potential for higher returns with less grain handling costs, and market price improvement|
|Potential is higher for PP following year||Ground will be frozen to allow travel across fields|
|Losses from weather events not insured||Grain doesn’t need mechanical drying|
|Ability to plant new crop limited||Test weight will be maximized|
|Lack of ability to sell crop for cash flow||Nicer weather to operate machinery|
|Fields are too wet to harvest||Potential to capture improved market prices|
|Limitation of resources to plant and harvest at same time|
For our financial discussion I will focus on the March harvest time frame vs. harvesting in December as I believe this is the most likely harvest scenario for growers. The May/June harvest leaves too many risks on the table for loss of this year’s crop and ability to plant a crop next year.
So, to set things up we are still looking at our same field as described above. Drying charges for on farm are $0.03/point of moisture, and $0.05/point of moisture at the elevator. BCFM discounts will be taken on farm dried corn above 23% moisture, taking into consideration the damage that will be caused by the drier at these moistures. Cash price for corn will remain at the $3.40/bushel mentioned earlier.
In the chart below, the blue line shows the gross revenue from an acre of corn after a given amount of yield loss noted on the bottom axis, and assumes harvesting in March at 20% moisture and mechanically drying to 15%.
The orange and gray lines represent gross revenue/acre harvesting grain at the moistures reflected on the top axis and harvesting this fall.
Where the lines intersect is the point at which the decision to leave a crop stand or harvest will be the hardest. The risks of harvest loss and the cost of drying will need to be examined for each situation.
For our example field, running 28% moisture on December 1 here is what we can take away:
✔️If the loss from standing in the field is less than 12% or 20 bushels an acre, a March harvest would be better from a financial standpoint.
✔️If yield loss will be more than 12%, more money can be made harvesting in December, even if you are looking at 30% moisture corn at that time frame.
Keep in mind— a crop in the field after December 10 isn’t covered by insurance from weather events. This date is subject to change so be sure to check with your insurance provider as that date approaches.
Here are my final thoughts on this situation.
- Go Scout
- Every field: Make note of how stalks and shanks are holding up in every field.
- Look for troubles: Note fields that have stalks or shanks that are starting to breakdown. These fields are at the highest risk for loss during the winter months if left to stand.
- Know your soil: Start scouting in fields with higher soil pH and salt levels; they will be the first to break down.
- Make a List
- Prioritize: From your scouting make a list of fields that are a priority to harvest and those that can wait for later harvest. Having this game plan in place will allow you to maximize harvest efficiency when you do start to harvest.
- Know the Risks
- Lost bushels: If you do make the choice to leave fields stand through part or all of the winter know that you are at risk of losing bushels to the ground and not having insurance coverage for these losses.
- Lost revenue: If your balance sheet cannot handle this type of risk you may need to rethink your decision. Now is a great time to visit with your crop insurance agent and banker to determine best risk management tools for this harvest.
- Manage your fields for next spring: If you are unable to till behind the combine this fall, I recommend that using a non-chopping corn head, or disengage the chopping mechanism on your chopping head. This will keep stalks upright rather than being chopped up and forming a thick mat on the ground. By having the stalks up right with less residue on the ground, more soil will be exposed to sunlight in the spring allowing for faster soil drying warm up.
- Be Safe and Call for Help: This harvest looks to be one that will be trying both physically and mentally for all those involved. With this being the case, we invite you to call us with any need you may have. We are more than happy to find you the trucks, drying capacity, or listening ear to vent to as you battle to get this harvest done.
Thanks again for all your business and we look forward to celebrating with you when all the equipment is parked!