farmgate: Values Are Known For Grain In The Bin, But What Is The Value Of A Standing Crop?
Even though you had your combine set perfectly, a herd of cattle can always find plenty of grain in corn stubble. And with many cattlemen holding their stock out of feedlots as long as possible to save money, this year’s challenging corn crop may provide opportunity for both the corn grower and the cattleman. The only question is the value that can be placed on pasturing cornstalks.
Values can be well documented for grain in the bin and hay in the barn, but when a forage crop is still in the field, there is a lot of head scratching about its value. For the most part the forage season is gone for this year, except for corn stalks. But with the help of Iowa State economist William Edwards, we’ll tackle the value of cornstalks and venture into the value of forages in the field.
Cornstalks
Many head of cattle are being turned out into cornstalks, but when different owners are involved, the value of the rented field must be determined. Edwards says rental rates are $6 to $10 per acre, or $4 to $8 per AUM, which is equal to a mature beef cow grazing for one month. Edwards says harvested cornstalks are worth about 50% of the value of grass hay for beef cattle. If the buyer does the harvesting, then use 25% of the value of grass hay for the price. If weights of large round bales are used, Edwards suggests 1,200 to 1,300 lbs. for hay and 800 to 900 lbs. for cornstalks.
Hay and Haylage
Looking ahead to next year, Edwards says selling standing hay is the same as renting pasture, and can vary widely depending on the type of forage, quality of the crop and the local demand. For the first cutting, a charge of 40% to 50% of the yearly rent would be appropriate, and later cuttings would be worth 35% to 30% of the annual pasture rent. If hay is selling for $5 per small bale, subtract $1 for mowing and baling and charge $4 for the hay, multiplied by the expected number of bales. For haylage, the feed value of a ton of unharvested haylage with 40% to 50% moisture is equal to a half ton of dry hay, minus the cost of harvesting and hauling. If the price of hay is $90 per ton, and harvesting is $18 per ton, the standing crop would be worth $27 per ton.
Corn silage
Corn silage is valued at the price of the grain, and accounting for the harvesting costs saved, a ton of silage is worth 6 times a bushel of corn. Multiply the value of a ton of silage by the tons per acre to get the value of standing corn. Moisture will be about 60% of the volume, but compensate for differing moisture content. If the silage has been harvested and stored, the value increases to 9 times the price of a bushel of corn, with any adjustment for condition, access, or delivery.
Oats
Similar to corn, standing oat silage can be valued at the price of the oats. Edwards says the straw has a value, harvesting costs have been saved, and if the oats are 70% moisture, then the value of a ton of oat silage is 13 times the value of a bushel of oats. If the silage has already been harvested, then use a multiplier of 17.
Summary:
Livestock producers have long fed their own crop without accounting for its value, and only trying to add value to the grain by converting it to meat. However, with multiple owners of crops and livestock, and the opportunities that arose this year to save money on cattle feed and also glean fields of downed corn, the value of cornstalks comes into question. If grain prices remain high and livestock operators look more to feeding standing crops, reasonable values must be assigned to those crops.
Posted by Stu Ellis on November 12, 2008 12:50 AM to farmgate