Evaluating UFC's Grain Elevator Assets
Apr 09, 2022
One of the bigger challenges a grain elevator faces is keeping the elevator’s receiving speed and capacity aligned with the speed at which growers harvest their crops. This challenge is even greater if there are only one or two elevators in the company’s portfolio. Fortunately, UFC has eight locations to deliver grain at.
Throughout the last six months, the UFC grain management team has spent time evaluating our locations. The goal of our evaluations is to generate operational efficiencies that improve the speed, space and overall utilization of our grain facilities both internally and for our patrons. This will remain a priority well into the future. There are a number of factors we consider during our evaluations. Historical crop data is a strong indicator of whether a specific location is in need of additional speed or space. External factors are also evaluated. We look at the end uses of the grain (feed use, ethanol grind, processing plants). UFC is very close in relation to all three of those end uses as well as being active in the export market at our Brownton location.
From a growers perspective, price is typically the first factor looked at when determining where to deliver grain. The next thing they look at is: does the elevator provide the speed, space and services needed to keep up with their individual farm needs? Time spent waiting in line for trucks to unload is expected at harvest time, within reason. Having to sit in a truck line to unload at a ground pile can also be acceptable if efforts are being made to keep the trucks moving. As patrons of UFC, we understand these are some of the many expectations you have of our grain division. These factors have a strong influence in our evaluations and will help guide us as we work towards increased efficiencies.
That being said, one of the resounding pieces of feedback management hears from growers is more space is needed at our elevators during harvest. When looking at one specific location, the solution may seem clear. However, with eight different elevators in our portfolio, it is our job to evaluate the full picture by looking at each location and understanding how we are using the space. Unfortunately, it is not as simple as expanding. Commercial space is costly to build, maintain and operate. In order to realize a return on investment, the elevator needs to be able to turn its space multiple times a year to cover those expenses. Adding space to cover the needs for a month or two out of the year does not cover the costs of adding bin space at a location.
Moving forward, management is looking to invest capital in order to improve the speed of truck lines
at multiple locations, not just one. One solution we are exploring is adding a dump pit and leg to move trucks through more efficiently along with adding conveyors or additional space. Making this type of investment would allow us to increase our quality of service, and better meet the expectations of our growers, across all our locations. Rather than hauling a load an extra thirty miles to a location with faster speeds, these growers would be able to haul to a location closer by, move through that line quicker and be able to return to the field faster.
The UFC grain division will continue to focus on providing growers with multiple options that meet expectations for harvest and non-harvest needs. We look forward to serving you throughout the upcoming growing season!
-Jason Tews, Vice President of Grain