The Swedish cooperative Lantmännen Ekonomiska Förening has initiated a project labelled "Operation Blåljus" that includes an extensive program for closing down elevators. The number of elevators will be reduced from 92 to approximately 15 after harvest of 2007. The objective of Blåljus is to increase the price of grain with 10 öre/kg. A project has been initiated at the Lantmännen Grain division where the purpose is to provide the farmers with support in their decisions and practical advice how they can load a 35 ton grain truck on 30 minutes. The result from the project will serve as a support system to the farmer in his ambition to achieve cost efficient systems to load a truck with grain on the farm. This master thesis is an economic evaluation of different systems for farm based grain handling.
The study is concentrated to three production areas in Sweden, Götalands Södra Slättbygder, Svealands Slättbygder and Svealands Skogsbygder. In these areas three case farms have been identified that each cultivates 50, 100 and 150 hectares of land. On the basis of historical grain prices of Pool 1 (1 September) and Pool 2 (1 December) and with the consideration of a trend adjusted 10 years average yields, gross margin budgets have been constructed for six of the most common grain crops. The gross margin for each crop takes into account transportation, drying costs and patronage refund. Further, five different systems for grain handling have been used in the study, a truck container system, concrete platform, a loading bin - one for indoor use and one for outdoor use, and a plant for drying and storage of grain. The grain handling costs consists of a capital cost and a variable cost when loading a truck and potential costs for drying. This study is based on linear programming where the crops and grain handling systems constitute the activities. Crop rotation effects are also considered in the model.
The results show that two handling alternatives emerges as the most interesting ones from an economic perspective; concrete platform and loading bin indoors. For 6 of the 9 case farms grain handling on concrete platform was the alternative that gave the best economic result. The handling cost on a concrete platform is approximately 3-7 öre/kg and the cost of a loading bin between 3-11 öre/kg, depending on farm size.
Given the current level of grain prices an investment in a drying- and storage plant is less profitable than handling undried grain. For the 50 hectare farms the Pool 2 grain prices must increase with approximately 33 öre/kg if an investment in a drying and storage plant to shall become profitable. Alternatively, the investment volume should decrease with 65 %. For the 100 hectare farms a Pool 2 price that is 15 öre/kg higher than today is required to make the investment profitable or a decrease in investment volume with approximately 50% is required. For the largest farms in the study the Pool 2 price has to increase with 10 öre/kg, or the investment costs must decrease with approximately 40 %, to make the investment in a drying and storage plant more profitable then delivering undried grain. Through farm collaboration with an unloading bin a 50 hectare farmer may save 6 500- 9 000 kr/year. Corresponding savings for collaboration in a drying and storage system is approximately 40 000 kr/year. We may conclude that for all the case farms that ...
