Pricing drought-damaged corn
Corn that has suffered severe drought damage is sometimes harvested as silage instead of grain. It can still have significant feed value if harvested at the right stage.
“There are several things you should consider before you decide to harvest drought-damaged corn for forage or silage purposes,” says William Edwards, Iowa State University Extension economist.
First and foremost, any damaged acres that are covered by crop insurance should be viewed by an insurance adjuster and released by the insurance company before harvesting takes place. Whether it’s your droughty corn you want to harvest or corn that belongs to someone else, the crop insurance agent should be the first person the owner of the standing crop contacts.
Grain producers may be willing to sell corn standing in the field to be harvested by a livestock producer or custom operator. The buyer and the seller must agree on a selling price. “The seller would need to receive a price that would give at least as good a return as could be received from harvesting the corn as grain,” says Edwards. “The buyer would need to pay a price that would not exceed the feeding value of the corn.”
Figure value as silage
Edwards offers the following guidelines to help you figure how much to pay your neighbor for drought-damaged corn harvested as silage or forage.
One ton of normal, mature-standing corn silage at 60% to 70% moisture can be valued at about eight times the price of a bushel of corn. For a $6 corn price, a ton of silage would be worth about $48 per ton. However, drought-stressed corn may have only 5 bushels of grain per ton of silage instead of the normal 6 to 7 bushels. A value of about six times the price of corn would be more appropriate. For silage with little grain content, a factor of five times the price of corn can be used.
If the crop is sold after being harvested and transported, those costs must be added to that value, typically $5 to $10 per ton, depending on whether it is done by a custom operator or the buyer, and the distance it is hauled. A buyer would only consider the variable costs for harvesting and hauling, whereas a custom operator would need to recover fixed costs, as well.
A spreadsheet for estimating value for corn silage is at www.extension.iastate.edu/agdm/crops/html/a1-65.html.
This article published in the August, 2012 edition of WALLACES FARMER.