Wade: Timing is crucial with corn harvest, storage

Published in The Messenger on 9.7.07 Those two mountains of corn that recently appeared in Obion County are the result of an issue crucial to agricultural commodities — timing. “If the harvest had hit on a normal pace, you wouldn’t see any corn on the ground,” said Will Wade, chief manager of Union City Grain Company. The term “normal pace” refers to the traditional date — the day after Labor Day — for corn shelling to get under way in the county. But this year, because of the drought, Mother Nature intervened. “It’s simply harvest logistics,” Wade said. “The harvest started two weeks earlier than normal, and at a very rapid pace. The corn is very dry, not slowing combines down one bit. We just got flooded and had no way to get rid of it.” The two “mountains” of corn are in Union City and Obion. Union City Grain Company has rented several acres of a cut-over cornfield alongside Highway 51 bypass near Second Baptist Church. Tractor-trailer loads of shelled corn have already dumped about 100,000 bushels at the site. Obion Grain Company has temporarily placed several acres in the vicinity of the city dump. About 500,000 bushels of corn have been deposited at the site, according to Obion Grain Company manager Mike Miller. And that’s not all. Miller reports the company has a similar site at Dyersburg where about 800,000 bushels form an impressive sight. The logistics that Wade refers to includes transportation issues, too. “We have to order our rail cars four months in advance. It’s kind of like trying to look into a crystal and see when we’re going to need them,” he said. Grain brokers such as Union City Grain and Obion Grain depend on Canadian National Railroad (CNRR) to supply rail cars to pick up and move grain to markets. But CNRR is experiencing the rush, too. Wade said an alternative to shipment by railroad is shipment by river barge. “But barges are in the same situation as rail cars. They’re scarce,” he said. “And there’s been real problems in getting the inventory down river. Getting barges is the No. 1 problem, loading them full draft is the No. 2 problem.” If not via rail or river, why not via tractor-trailers? “Because of the way the market is right now, we can’t afford to truck it,” he said. “The rail market right now is better than the river market. It doesn’t always happen that way. But it is right now. We’ve got the (rail) cars sold for September and we’re just waiting on delivery of the cars. We’re loading cars this morning (Thursday). We’ll probably get two or three 25-car trains every week.” And there’s one other pertinent point to this perhaps perfect storm of a corn crop this year, Wade added. “There is just so much corn (produced) in the Delta, in the Mid-South, and in southern Louisiana,” he said. “There’s been a tremendous corn crop made in the southern Mid-South. They’re still in harvest, and they’re wanting barges, too. It’s a problem all the way up.” He said he doesn’t recall the exact numbers, but Louisiana more than doubled its corn acreage this year. In fact, for the first time in its history, Louisiana produced more corn than cotton. And there’s the market itself, he said. Back in January and February, “when this thing hit a fever pitch,” corn prices — “futures,” in the lingo of brokers — on the Chicago Board of Trade were $4.50. “It was indicating (farmers) needed to grow more corn,” he said. “Futures prices started coming down as planting intentions were announced and (the U.S. Department of Agriculture) was putting out its numbers.” USDA projected the 2007 corn crop nationally at 92.5 million acres. “It was confirmed in the USDA June report,” Wade said. “Now the futures market on corn is more like $3.30. So we’ve had a dollar decrease in corn futures. “The overall general idea was that the price of corn demanded the (increased) acreage this year, and the Mid-South responded,” he said. Meanwhile, what about that big pile of corn that Union City Grain has accumulated out there by the bypass? “We’ve got the rail cars coming. We’re going to pick it up within three or four weeks,” he said. “It was either (pile it on the ground) or start losing business. We’ve lost some business because we were down to a couple of pits that are slow unloading. About half our (storage) space is fast unload, and half is not-so-fast unload. We were down to one pit that we could operate because we were waiting for rail cars. That’s when we opened the ground pile. “It’s just an accommodation to our customers. We’ll do everything we can to not stop the harvest.”

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