2008 National Women in Agriculture Educators Conference Grain Management Decisions at Harvest Garrett Stoerger Paul Ellinger University of Illinois April 2, 2008

2008 National Women in Agriculture Educators Conference 2 Harvest time FAQ’s  Where should I deliver my grain?  How do I structure and organize my grain marketing decisions?  Should I be adding on-farm storage to my operation?

2008 National Women in Agriculture Educators Conference 3 Answers to these questions  The University of Illinois team of agricultural economists have developed a set of tools to assist educators in the delivery of effective educational programs for farmers

2008 National Women in Agriculture Educators Conference 4 How the tools are used…  Grain marketing and management tools are taught in a classroom style setting with each participant having computer access  Often taught at Annie’s Project  Laptops or computer labs  Class size ranges from 10 to 25  Smaller groups allow for more interaction  Use of developed case studies

2008 National Women in Agriculture Educators Conference 5 Teaching Goals and Objectives  Let participants dictate the class speed  Spreadsheet tools can be tedious for first time users  Get them started in the right direction  Having participants start on their own records in the classroom can lead to success at home  Utilize case studies  Don’t make it a typing lesson – time is limited

2008 National Women in Agriculture Educators Conference 6 What is FAST?  Farm Analysis Solution Tools are a comprehensive set of Microsoft Excel spreadsheets designed to assist those in agriculture make better decisions via user- friendly computer programs  Over 50 spreadsheets have currently been developed to aid farmers in their decision making

2008 National Women in Agriculture Educators Conference 7 FAST is easy…  Each spreadsheet has been developed with the end user in mind  Input friendly  Tools can be personalized  Program Descriptions (user guides) are easily accessible  Available through a CD or the internet  Quarterly update service for subscribers  Support team available for questions

2008 National Women in Agriculture Educators Conference 8 FAST Categories  Financial Analysis  Investment Analysis  Loan Analysis  Farm Management  Grain Marketing and Management  Risk Management, and Yield and Land Database Tools

2008 National Women in Agriculture Educators Conference 9 Grain Management Decisions at Harvest  Marketing tools that complement one another in an academic setting  Grain Delivery Model  Grain Inventory Management  Grain Storage Purchase Analysis

2008 National Women in Agriculture Educators Conference 10 Why the tools are used… Grain Delivery Model  The growing ethanol business has provided new opportunities for delivery locations  Grain delivery points should be analyzed using more than the spot delivery price  The current commodity prices are forcing many elevators to change storage costs  How do your local elevators compare?

2008 National Women in Agriculture Educators Conference 11 Why the tools are used… Grain Inventory Management Tool  Women in the record keeping role are looking to improve the quality of their records  Allows an active role in record keeping  A simple data entry method can keep track of multiple locations with ease  Provides grain production statements for all grain owners  Quick and easy way to impress your landlords  Improves communication  Spouses  Landowners

2008 National Women in Agriculture Educators Conference 12 Why the tools are used… Grain Storage Purchase Analysis  The current economic environment in agriculture lends itself to on-farm storage  What are the economics? Building costs Maintenance Utilities  How does it compare to commercial storage facilities?

2008 National Women in Agriculture Educators Conference 13 Grain Delivery Model  Designed to aid grain owners when comparing delivery point alternatives  Calculates net price received after drying, storage, transportation, and other costs  Elevator specific inputs such as shrink factor and drop charges built in  Computes a breakeven price level for grain that is placed in deferred storage

2008 National Women in Agriculture Educators Conference 14 Grain Delivery Model Summary

2008 National Women in Agriculture Educators Conference 15 Projected Price Module Black-Scholes’ Model

2008 National Women in Agriculture Educators Conference 16 Grain Inventory Management  A program designed to make quick and easy work out of tracking grain from field to bin  Eliminates grain inventory “headaches”  Produces summaries of acreage planted, yields, grain fed to livestock, etc.  Data can be queried by farm, storage location, landowner, etc. X

2008 National Women in Agriculture Educators Conference 17 How it works… Inputs Information about the grain owners, storage locations, farm locations, and planted acres Transactions Records everything from production to transfers to the sale of the commodity Reports Gives details of total acres planted, bushels produced, and sales records by owner or location Keeps a “paper- trail” for all grain transactions

2008 National Women in Agriculture Educators Conference 18 What it reports… Report of Productions by Location Elevator 1 Elevator 2 Production Summary of the crop’s status Remaining crop A report of what bushels have not been marketed

2008 National Women in Agriculture Educators Conference 19 Grain Storage Purchase Analysis  A tool designed to calculate the costs associated with adding on-farm storage  Calculates costs in terms of overall costs and per bushel  Can also evaluate the cost/benefit of on-farm storage when compared to commercial storage locations

2008 National Women in Agriculture Educators Conference 20 Grain Storage Costs Cost per Bushel Summary of costs in per bushel terms Cost per Year Summary of costs in yearly terms

2008 National Women in Agriculture Educators Conference 21 On-Farm vs. In-town Cost Comparison Drying Charges Shrink Costs Storage Costs Transportation Costs Quantity and Quality Premiums

2008 National Women in Agriculture Educators Conference 22 FAST Spreadsheets Lets take a look at a few of the spreadsheets