Harvest 2023 Grain Storage Outlook
Projected Returns to Storage
Over the past two years, tight supplies of corn and soybeans created positive returns to crop storage. Despite inverted markets, futures prices typically increased throughout the year. Furthermore, basis levels became extremely favorable in June, July, and August of both years as well.
However, storage does not have positive returns every year. Prices can fall or remain steady while storage costs eat into potential profits. This article examines the current outlook for returns to both off-farm and on-farm storage.
For this analysis, harvest was assumed to take place in October and no storage was charged in October. Commercial storage costs were assumed to be $0.045/bu/month for both corn and soybeans. This was typical among the posted commercial rates reviewed at the time this article was written.
Most co-ops have a minimum storage fee that covers 60-90 days of storage before a per-bushel-per-day or per-bushel-per-month fee starts. The initial storage fee was averaged into the calculated $0.045/bu/month fee and otherwise ignored for this analysis. Because of this assumption, actual...
Members Only Content
Join Iowa Farm Bureau or login to view all members only content and receive other member benefits.