MARKETING

Monitor bins by
sMartphone
By Maggie Van Camp,
CG Associate Editor
A
new web-based bin-monitoring
system that can be accessed by
smartphones is now on the market. Calgary’s
Mifarm.ag Management’s system
uploads real-time data on grain bin
conditions to a cellular network, to help
farmers better protect their crops from
spoilage and theft. Sensors located in
bins monitor grain volume, temperature,
and relative humidity, as well as
control fans.
The system also uniquely monitors
grain levels to warn of theft, an increasing
threat.
Instead of buying and installing the
system, you sign up for a three-year
contract and Mifarm provides the service,
including the cables and relay system.
This costs about $0.12 per bushel
over three years and includes service.
Every 15 minutes the sensors give a
reading and within 10 minutes you get
an alarm by email.
Mifarm president, Gary Gunthorpe,
says the company started installing systems
this summer and recently installed
a 400-sensor system in a 30-bin storage
facility. The information is communicated
by cloud-based database that
farmers can access via web portal and
smartphone applications on both Rogers
and Bell. “Our cellphone modem is
higher and more powerful,” said Gunthorpe
when asked about cellular dead
zones. “It has four times the power of
your cellphone.”
The development work started in
September 2010 with three partners.
Delta T Engineering, ATI Agritronics Inc.
an instrumentation company from Saskatoon
and Cervus Equipment, a large
publicly traded company owning the
largest group of John Deere dealers in
Canada. Recently, the federal government
loaned $750,000 to Mifarm.ag
Management Inc. to help commercialize
this grain management technology. The
project forecasts the manufacturing and
installation of 300 systems in 2013 and
thousands more by 2016, and will create
15 full-time positions in the process.
Continued from page 23
b u s i n e s s
Grain bags have also been a good
solution for larger-than-expected yields,
or for crops that require storage but are
only grown once in a three- or four-year
rotation, like oats.
In 1997, the Sheas put up two more
9,000-bushel bins, enough for 100 acres
of wheat or 200 acres of soybeans, the
two crops that are traditional on this
flat, heavy-clay land. Having three bins,
naturally let them consider a third crop,
and they started growing corn.
That same year, Jeff came home
from attending DuPont’s Young Leaders
program in the Midwest with one
word on his lips — ethanol. From listening
to other participants, he knew
corn demand was going up. He could
also see yields going up, thanks to bio-
AdvAntAge #2
Avoid harvest marketing
Over the years, Jeff has used his storage
to avoid selling off the combine
when harvest-time supplies
were strong. His first lesson in the power
of patience came with his first bin. At harvest
some of his wheat graded as feed with
greater than 10 per cent sprouting (another
challenge in Ontario’s damp climate). Jeff
stored that wheat until the end of the winter
when he knew supplies were tighter… and
the same wheat graded #2 with a healthy
premium over feed.
A few sales like that can help pay for
the bin, Jeff says.
Jeff leverages his stubborn streak with
some good market information. In 2003
the Sheas added 50,000 bushels storage
and at the next harvest corn was only
$2.80 a bushel. Jeff filled the bins and
held… and held… and held. By September
corn finally got to his sell point of $4.
It’s during market downtimes when
having bin space really pays, says Jeff.
When prices dipped two years ago, the
Sheas built a 60,000-bushel bin. “In the
summer of 2010, I still had 90 per cent
of 09’s corn stored, and then in August I
bought all our 2011 fertilizer,” says Jeff.
“Corn was $3.75 per bushel in the fall
and by June it was $4.40.”
However, Jeff adds that it doesn’t
always work to his advantage.“Sometimes
my dad says I’m too in love with the
grain…”
tech traits including glyphosate tolerance.
Although corn prices at the time
were far from stellar, Jeff saw long-term
opportunity.
It was an insight that was bolstered
by his work as a DeKalb seed dealer
and former Monsanto sales representative,
where he could see exceptional
corn growers in his area starting to really
make progress with corn.
That’s when Jeff added the dryer.
“When times are tough is when I
build bins,” says Jeff. “These bins are
built for $3 corn, not $6 corn.”
In fact, Jeff doesn’t like the risk of
storing corn when prices are high and the
threat of prices going down weighs heavily.
Although the Sheas core all their bins
and have heat cables, he’s also well aware
of the potential of spoilage.
A major player in Ontario’s grain sector
agrees that marketing from on-farm
bins takes judgment.
Anyone who operates grain-handling
facilities needs to clearly understand their
costs and know that storing grain will
not always be a good marketing strategy,
says Wes Thompson, president of
Thompsons Limited in Blenheim, Ont.
“Get either of these principles wrong,
and profits evaporate.”
Commercial elevators use storage for
their own account only after careful analysis,
says Thompson. “Generally, one in
four years, storage is a waste of money.”
In 2010, storing grain for a sale later
in the year was clearly a winning strategy,
but in 2011, storage looked like a mistake
by the end of the winter, although
the Midwest drought later turned that
situation completely around.
The lesson, says Thompson, is that
it can be hard to predict the returns to
storage, and it’s impossible to guarantee
that storage will pay for itself in any
given year.
For wheat, Tjaden Lepp also takes a
cautious approach, recommending partial
sales and then holding some crop
for sales into early 2013. “Some pricing
before harvest is a good risk management
strategy,” says Tjaden Lepp.
Continued on page 26
2 4 c o u n t r y - g u i d e . c a S E p T E M B E R 1 7 , 2 0 1 2