Grain Storage Bags Saving Farmers Time, Money This Harvest

Though they may look like snowdrifts that somehow survived into the summer, the humongous white plastic bags that are appear on the southwest North Dakota landscape during harvest are full of very valuable commodities.

The 300- to 500-foot grain storage devices, which can hold anywhere from 12,000 to 34,000 bushels of wheat, are being used more than ever by area farmers who want cheaper and easier methods of storing their product once it’s off the field.

“There’s no way in the world I could farm that many acres without doing the bagging,” said Craig Fisher, who farms around 17,000 acres near Richardton and sells grain bagging machines through his business, Antelope Farm Supply.

Fisher started using grain bags in 2010 and jokes that a couple years later he was roped into selling them for Loftness, a Hector, Minn.-based company that builds the grain bagging machines.

Fisher said his sales doubled from 2014 to 2015 and have gone up another 25 percent this year.

He said many farmers are now using the bags in fields they’re harvesting, which cut down on truck transport.

“There’s always that lull when farmers quit hauling and they’ve got to keep grinding,” Fisher said. “Those bags really give you that flexibility, if you can manage the labor to do it.”

Keith Witte, who farms throughout central Hettinger County, has been using grain bags instead of adding extra bin space for the past three years. The Regent farmer said he has been impressed with the bags’ durability and the amount of money he has saved.

He has filled eight 12,000-bushel bags so far this summer and plans to fill three to four more.

“It does save me more, short-term,” Witte said. “Bins are long term and would be wonderful to have. But at the price, it’s not as feasible as this.”

Fisher said he sells three different bags, a 12-by-500-foot bag that holds 34,000 bushels of grain, a 10-by-500-footer that holds 22,000 bushels, and a 10-by-300-footer that hold 13,000 bushels. The smallest bag is the most common, he said.

Ben Hetzel, manager of Southwest Grain in Lemmon, S.D., said his elevator has been using the bags the past four years to help manage the volume of grain it takes in during harvest.

Because Lemmon is not on a major rail line and only has around 1 million bushels of storage capacity in bins, it was often faced with turning producers away during harvest after its bins filled up.

Since the elevator started using grain bags, however, Hetzel said it has been able to add about another 1 million bushels in storage capacity through their use of the 500-foot bags.

“Not having a lot of big space to hold grain for a few months, we’ve relied heavily on that to get us through harvest,” he said.

This year, the elevator has put around 700,000 bushels of grain in bags, and has used them as transitional storage beginning with winter wheat in early harvest. Hetzel said once bin storage space is cleared, they transfer the grain out of the bags. Once that happens, more grain will come in. That product is then put in bags and the process starts over.

“In order to do what we’ve done, we’d have really needed about a million bushels of space (in bins),” he said. “Even if you go cheap, that’s a $3 million-plus project. We might have total right now of 10 percent of that invested in this, and over 50 percent of that is something you can recoup your investment out of it.”

Hetzel said while using the bags has been profitable for his cooperative, the tool has been divisive among producers.

“The guys who hate them had a bad experience and won’t go there again,” he said.

Fisher and Hetzel said some farmers were scared off the bags because they aren’t impervious to large hail. Thunderstorms that ripped through the Mott and Regent area this summer brought large jagged hail and poked hundreds of holes in grain bags owned by farmer Alan Honeyman.

Hetzel said that also happened in Lemmon and “created a little nightmare,” though the bags still served their purpose.

Witte said the only issues he has had is the bags can attract wildlife if holes are poked in them.

“You have to do a great job of cleaning up any spills or anything around the bag. Don’t let the wildlife find it as a food source, or you’re out of luck. They’ll eat it,” he said with a laugh. “If a pheasant starts to poke on it, they’ll come back.”

Fisher said the bags are not supposed to be a long-term storage solution like grain bins. He suggests keeping grain in the bags for, at most, two years.

“We’ve had luck with them, but we empty them out in a timely fashion,” he said.

Parts of Southwest N.D. on Cusp of Grain Harvest

Kelly Herberholz made the first cut of this year’s harvest a week ago.

Since then, he and his father, Joe, have slowly been chipping away at their crop throughout central and western Hettinger County. Kelly estimates they have at least 300 acres done and that much of their spring wheat is running between 35 and 45 bushels an acre.

“We need more than that though,” he said with a short laugh.

Southwest North Dakota farmers are on the verge of what appears to be an above-average small grains harvest in a year where prices are well below average.

“There’s some good-looking crop out there. Now if we could just get a price for it,” CHS Southwest Grain General Manager Delane Thom said Friday. “A 50-bushel spring wheat crop is barely a break-even number.”

On Friday, 14 protein spring wheat closed at $3.85 a bushel at the Southwest Grain terminal near Taylor. Milling quality durum was $5.90.

As farmers like Herberholz are quietly chipping away at their spring wheat crop in Hettinger County — where the wheat is furthest along — he and others say and are awaiting higher temperatures this weekend that could turn a crop nearly ready to cut into one that’s falling into the hoppers of combines throughout the area.

“If the sun would come out, I think we’d all go,” Herberholz said.

This weekend — with temperatures forecast in the high 80s and low 90s, with a chance of thunderstorms on Sunday evening — could go a long way toward getting farmers in the field.

Tom Snell, who runs Snell Harvesting of Ellinwood, Kan., has 18 combines in Regent ready to go whenever the wheat is. He said they took a couple of their John Deere harvesters out north of the small town on Friday to try areas for one client.

Snell said he has seen some good crops throughout the Great Plains this summer and while this year’s North Dakota crop isn’t going to be a “bin buster,” he believes it’ll be a good one. And he wants to help get it off the field and into those bins as soon as possible.

“When it’s getting this close we’re no different than a farmer,” Snell said. “As quick as you can, you want to get going.”

Thom said he recently drove through much of southwest North Dakota.

He said crops didn’t fare well along the Highway 12 corridor between Bowman and Lemmon, S.D.

“It’s extremely dry down in that country,” Thom said. “A lot of that crop was rolled up for hay because the hay crop was short. The further north you get of that line, the better it looks.”

He estimates that five major hail events during the summer took out anywhere between 30,000 to 50,000 acres of cropland throughout the area, all the way from Scranton to Glen Ullin and, of course, north to Killdeer, where a devastating storm ripped through the Dunn County city and surrounding countryside on July 10.

Thom said crops north of Interstate 94 are at least three weeks away from being ready to harvest.

“Where it hailed it out, it hailed it out,” he said.

Thom said that in recent weeks, many farmers have been selling year-old wheat at his elevator in what he says is effort to clear storage space.

“There has been a fair amount of old crop movement, of wheat specifically,” he said. “That’s kind of an indicator that there’s got to be a pretty normal crop out there.”

Farmers aren’t the only ones preparing for harvest, however.

Mick Lewton, store manager of West Plains Implement in Dickinson, said his business has done about all it can do to prepare for one of the busiest parts of its year. He said the Case IH ProHarvest support team is also mobilized at the shop.

“It takes a little while to prepare for, but we’re about as good as we’re going to get right now,” Lewton said.

Cattlemen talk market volatility

Larry Schnell, owner of Stockmen’s Livestock Exchange in Dickinson, drew applause from his industry colleagues Friday when he said cattlemen are angered when traders use subtle deviations in the cattle markets and cause major price fluctuations that trickle down all the way to their operations.

“That’s why it’s so hard for us to accept that we should face the consequences of all the trading that takes place under the table, in the dark,” Schnell said. “That’s hard for us to accept. … These people here, they’re not a part of that. They only suffer the consequences of that trade.”

Many from the western North Dakota and South Dakota cattle industries gathered Friday morning at Stockmen’s to listen to Schnell and other industry leaders speak out on problems they see in the cattle markets at a forum hosted by U.S. Sen. Heidi Heitkamp, D-N.D.

Heitkamp, Schnell and five other panelists sat in the Stockmen’s sales ring — where cattle are typically showed for auction — as they discussed market concerns for more than two hours. Other panelists included Bowman rancher Steve Brooks, who is president of the North Dakota Stockmen’s Association; Justin Lumpkin, a U.S. Department of Agriculture marketing officer; Larry Kinev, president of the Independent Beef Association of North Dakota, and cattle buyer Fred Berger, of Mandan.

“What we were talking about here today isn’t, I think, about the high prices or the low prices,” Schnell said after the forum. “It’s about the volatility. It’s about the volatility where the market changes for what seems like no reason whatsoever.”

The managing director of commodity research for the CME Group, which operates the Chicago Mercantile Exchange, said the exchange is months away from fixing issues that cause excess volatility in cattle markets. David Lehman told cattlemen that the exchange, in the next couple of months, will implement market circuit breakers on live and feeder cattle to install limits on how cattle contracts are traded.

He said it should help ensure market integrity. The circuit breakers are intended to keep prices from skyrocketing or bottoming out based on volatile activity in the market regardless of the speed or way people are trading.

“Rather than a hard limit that stops the market, it halts the market,” Lehman said, adding it will trigger if live cattle prices move more than $1.50 during an hour, or $2.25 for feeder cattle.

Ron Volk, a rancher from the Sentinel Butte area, said he understands the reasoning for implementing the circuit breakers but told Lehman he doesn’t believe it’ll be a permanent fix for the market’s instability.

“It seems to me like we’ve got a broken leg and you’re trying to throw a couple Band-Aids on it,” Volk said. “I don’t see it changing anything. It’s prolonging the broken leg. Now instead of putting a cast on, you may have to cut the leg off.”

Lehman said he agreed that “the leg is broken,” but said circuit breakers already help deter volatility in many markets, including oil and precious metals.

He said the circuit breakers are being put in place to limit moments like one that happened last week when 175 feeder cattle contracts — nearly three times the average daily trades made — were traded on the Chicago Mercantile Exchange and caused cattle prices to drop significantly.

“That set off a cascade pushing the market down until it found the other bids or offers that could match this 175-lot order,” Lehman said.

The problem, the panel said, is the volume of electronic trading happening by hedge funds or others who normally wouldn’t trade cattle futures, but do so based solely on market deviations.

Schnell believes it’s “nerds writing programs who are looking for an advantage.”

“What some of those algorithms trade on is only the knowledge of the trade, not knowledge of information,” Schnell said. “To us, that’s insider trading.”

Mike Heaton, a McKenzie rancher and member of the Independent Beef Association of North Dakota, said those outside of the cattle and agriculture industries trading live and feeder cattle and causing volatile prices swings in the markets, are comparable to parasites.

“There’s a whole other world out there of people living off of our industry,” he said. “When we get no return on it, they’re like the parasite that I get rid of in my cattle.”

Heitkamp said the Senate Agriculture Committee — of which both she and Sen. John Hoeven, R-N.D., are members — is holding a hearing about the volatility in cattle markets Thursday in Washington. She said part of the reason for hosting Friday’s forum was so she could get an idea of what North Dakota cattlemen believe are the biggest issues.

“The more this marketplace does not work for the people in this room, the more difficult it’s going to be to manage it,” Heitkamp said. “The more people who pull out, the more irrelevant it is.”

Herman Schumacher, a cattleman from Herreid, S.D., challenged Lehman on the constant cattle market fluctuations and said he believes the issue comes back to hedge funds and the meat packing industry trying to build a greater stake in the market.

“We’re fighting to try and not chicken-ize the cattle industry,” Schumacher said, referring to the influence large corporations have on the poultry trade.

Schumacher said he thought the input cattlemen from the area had at the meeting was beneficial as Heitkamp and others take their issues back to Washington next week.

“The only thing that keeps us separate from them (the commercial meat packing industry) are these cowboys that you had sitting there,” Schumacher said, pointing to chairs behind him.

Hoeven, fertilizer dealers oppose anhydrous restrictions

North Dakota politicians and agriculture leaders say a “reinterpretation” of U.S. Department of Labor rules may lead to one-third of North Dakota’s fertilizer retailers eliminating anhydrous ammonia sales.

U.S. Sen. John Hoeven said he is working with the state’s Department of Agriculture, producer organizations and fertilizer sales dealers to kill the proposed change that would hold 275 small fertilizer retailers in the state and around 3,800 nationwide to the same standards as much larger warehouse wholesalers, thereby raising costs for the retailers and, in turn, farmers.

Hoeven said around 90 North Dakota fertilizer retailers have stated they’d be likely to eliminate anhydrous ammonia sales if the new standards are put in place. Anhydrous ammonia is the primary nitrogen fertilizer used by North Dakota farmers.

Ron Kessel, a sales representative at Helena Chemical in New England, said while his company wouldn’t have to eliminate anhydrous sales, “it would change how we do business.”

Last July, the Occupational Safety & Health Administration released a memorandum titled “Process Safety Management of Highly Hazardous Chemicals and Application of the Retail Exemption,” detailing its revised interpretation of rules for exempting retail fertilizer facilities from the same standards larger fertilizer warehouses are held to. According to the memorandum, the change is tied to President Barack Obama’s executive order to improve chemical facility safety and security following the West, Texas, explosion in April 2013.

“You’ve got people out here trying to farm — it’s a tough time for farmers because of low commodity prices — and they come out with these rules and regulations and say it’ll cost a couple thousands, and that’s not true at all,” Hoeven said.

Gary Knutson, executive director of the North Dakota Agricultural Association, said he’s still waiting for answers for why the changes are necessary, as well as a breakdown of costs associated with the proposed changes.

“Bottom line is, we’re looking for answers yet,” Knutson said.

Hoeven said OSHA and the Department of Labor haven’t been transparent with the costs that would be associated with storage improvements southwest North Dakota retailers would need to make to be in compliance with the reinterpreted rules.

OSHA documents state the cost, on average, would only be around $2,100 per facility. But Hoeven and others vehemently dispute that.

The senator said OSHA denied a freedom of information request sent by state Agriculture Commissioner Doug Goehring’s office asking about details for how it came to the $2,100 figure.

“That’s not right,” Hoeven said. “It’s going to cost them more than 10 times that.”

Delane Thom, the general manager for CHS Southwest Grain near Taylor, said he figures his company would have to spend more than $100,000 to upgrade its nine anhydrous ammonia distribution sites, and that’s “just the tip of the iceberg.” He added he’ll have a more concrete idea of how much his company would be spending after a third-party assesses its locations for compliance changes.

Should the regulations go through, Thom said Southwest Grain would have no choice but to pass the costs on to farmers, and said discussions would be had about closing some of its satellite anhydrous locations.

“That’s not our intent, but we’ve just got to make a business decision at that point and see if it feasibly makes any sense,” Thom said.

Kessel and other North Dakota’s fertilizer retailers say they already have strict regulations on how they must store and distribute hazardous materials, and the new regulations would force them to pass additional costs along to farmers and producers.

“We want all of employees and our farmers in our local communities to be safe,” he said. “We’re very concerned and cognitive of that. We don’t know that these additional regulations are going to make it any safer without adding a bunch of additional costs to it.”

Kessel said another area of safety concern being raised by retailers is that if some satellite anhydrous retail sites around the state were to close because of the new regulations, it’d create a more direct hazard because many farmers would be putting anhydrous tanks on the road for longer periods of time.

Under North Dakota law, the heavy anhydrous tanks cannot be hauled at more than 25 mph.

“If you actually have nurse tanks being pulled that much further and through that much traffic, I think it’s going to add some safety concerns,” he said.

Thom said he could foresee farmers — some of whom have invested hundreds of thousands of dollars into purchasing their own anhydrous tanks — moving away from anhydrous ammonia and toward urea as their primary nitrogen fertilizer. However, he said, farmers need to use twice as much urea for it to have the same effect as anhydrous ammonia, which could add more costs to his and other businesses.

Hoeven wrote a letter to U.S. Secretary of Labor Thomas Perez on April 28 addressing his concerns. North Dakota Rep. Kevin Cramer in March was part of a bipartisan group of 41 members of Congress who requested the 2017 Labor, Health and Human Services, Education appropriations bill prevent using federal funds to implement new regulations on anhydrous ammonia facilities throughout the nation.

Hoeven said he’s likely to put a provision preventing the anhydrous ammonia regulations from being implemented in the Department of Labor’s 2017 funding bill.

“I’ll put legislation in to stop it if I have to,” he said.

Planting season well underway, though farmers hope precipitation is in future

MOTT — After 23 years of farming, Mark Anderson is happy to stick to his “game plan.”

The Regent-area farmer said neither below-average precipitation nor low commodity prices have shaken him much this year. He’s still seeding the crops he’d planned for and said Monday that he’s more than halfway finished.

Though with much of western North Dakota in a moderately dry drought, according to the U.S. Department of Agriculture’s drought monitor, Anderson and others say they can’t help but hope for a little rain soon.

“It’d be nice to get a good rain to settle the dust,” he said. “I think everybody would have kind of a weight lifted off their shoulders if they’d get an inch of rain.”

Most southwest North Dakota farmers are in the same boat as Anderson — about half done with their spring planting while hoping for some moisture to give those seeded crops an early boost.

Garret Swindler, who farms east of Anderson in the Mott area, said the only benefit to the dry year so far is farmers were fighting wet and muddy fields just to get their crops seeded last spring.

He said the moisture left in the topsoil after winter is fine for seeding, but it’ll only be good if planting season if followed by some rain.

“There’s enough moisture there to get the crops started,” he said. “We’re definitely planting deep. … We just have to make sure that seed has enough moisture to germinate and get out of the ground. But you can’t really wait on rain either.”

Duaine Marxen, the Hettinger County Extension agent in Mott, said most farmers he works and speaks with on a regular basis have been in the field for the past couple of weeks, and like Anderson and Swindler, most are well on their way to wrapping up planting efforts. Contending with dry conditions and high winds, however, have made for some challenging days, he said.

“No one here will complain if it starts raining,” Marxen said with a laugh.

Farmers might get their wish this weekend.

The National Weather Service is forecasting some showers for southwest North Dakota this week, with chances increasing toward the weekend and into next week.

That could be a welcome relief, as Todd Hamilton, a meteorologist with the National Weather Service in Bismarck, said the Dickinson area is already 1 inch below average rainfall for the year.

“We haven’t really had any real significant precipitation in quite some time,” Hamilton said, adding it has been about six months since southwest North Dakota experienced a large precipitation event.

He said conditions are “abnormally dry” throughout the western and central parts of the state.

“We are still early in the growing season now, so there’s certainly potential for us to move out of this,” he said.

Anderson said he has wrapped up seeding his spring wheat and Swindler planned to be finished with it by today. After that, both said they’d move on to other crops such as flax, canola and corn.

Anderson said while some farmers might be trying to “outguess” the weather or the future of commodity prices in deciding what or where they plant certain crops, he’s happy to stay the course and stick to what has worked for more than two decades.

“What looks poor now may be your best moneymaker in the end,” he said. “… I’ve been through these times before. You just seed the crop and cross your fingers.”

Column: Farmers Prepare for an Ugly Year

There’s volatility in the lifeblood of southwest North Dakota.

And I’m not talking about oil. People often forget how challenging life can be for family farms.

This year is poised to be no different.

In mid-March, myself and Brock White — my co-host on “Insight,” a weekly news talk show that airs on Consolidated Channel 18 and streams on The Press website — interviewed North Dakota Agriculture Commissioner Doug Goehring for 25 minutes about the upcoming planting season and the challenges North Dakota farmers are expecting this year. Goehring, early in the interview, put it bluntly.

“It is a bit depressing,” he said, laughing quietly before quickly turning serious.

I, like so many others in our area, grew up a farm kid and understand the importance farmers, ranchers and the agriculture industry have on our economy and our culture. This year, Goehring said, all signs point to struggles for many North Dakota farmers.

“We have a lot of farmers who, first of all, are very concerned — and have been for the past year and a half — about falling prices,” he said. “We’re to the point where it doesn’t even look like there’s a flashlight or any daylight at the end of the tunnel.”

Many balance sheets just aren’t penciling out for farmers this year, Goehring said. With current prices, most aren’t even looking at profi ts. Their projections show big losses.

Goehring and I even shared similar stories that we’ve heard about longtime North Dakota farmers who didn’t get approved for their operating loans by banks they’ve been going to for years.

In short, they’ve reached the point where it’s fi nancially uncertain if they can even continue farming. And for most, it’s the only livelihood they’ve ever known. All this is happening because of sagging commodity markets.

The price for 14 protein spring wheat — which is medium-quality — closed at $4.34 a bushel on Thursday. Hard amber durum was at $4.60. Those are extraordinarily low prices in today’s markets. Corn, sunfl ower, canola and soybean prices also are all low as farmers head into the planting season.

“You’re trying to fi nd that crop that’s not going to do as much harm to you,” Goehring said.

Most commodity prices are the same — or lower — than they were 20 years ago.

At the same time, operating costs for farmers keep going up. Machinery is more expensive, insurance prices keep climbing, fuel — while at fairly moderate price levels today compared to a couple years ago — still isn’t cheap.

Goehring, in our interview, mentioned an equipment dealer who had sold one tractor between last fall and this spring. That points out the obvious ways in how other livelihoods in our state are affected by farming.

On top of all this, we live in a world where farmers are expected to produce more and more food, which means more production from all farmers — not just those in North Dakota. While it may seem like a cliche point to make, if farmers can’t afford to farm, how are we going to feed 7 billion people (and growing)?

Goehring said his hope is that prices will begin climbing into the summer — possibly changed by weather, production in other ag commodity markets across the world or unforeseen issues altogether.

“We live off from hope,” he said, “and let’s face it, farmers are a unique breed. You live by faith and hope, because you don’t control the weather and you don’t control the markets. And those two things look like they could be rather volatile this year.”

Bowman’s Steve Brooks balances ranching with role as ND Stockmen’s Association president

BOWMAN — Skeeter Brooks is getting an education not only in ranching, but also the often unseen business that happens outside of the corrals.

The 25-year-old is part of the sixth generation at Brooks Chalky Butte Angus Ranch, and said her ranching education is growing every day — particularly through her father Steve Brooks’ role as North Dakota Stockmen’s Association president.

“We learn a lot from it,” she said. “Every day, somebody might call and they’ll have a question about brands or something, so that furthers us in our education. You meet so many people too. There’s always people stopping by. When you go somewhere, you always run into somebody.”

Steve Brooks — who runs Brooks Chalky Butte Angus Ranch north of Bowman with his brother, Ryan, and their families — has spent a lifetime ranching. But for the past year and a half, he has also taken on the leadership role among cattlemen in the state. Though the position forces him to balance his time between working on the ranch and on behalf of his peers throughout the state, Brooks said he’s pleased with what he’s been able to accomplish — even if it keeps him very busy.

“Being president of Stockmen’s has involved a lot more than I realized,” he said with a laugh, noting he was also president of American Angus Association in 2003. “That was a big job, and I thought this was a step down and a lot less time consuming, but it’s not.”

During last year’s legislative session, Brooks said he drove from Bowman to Bismarck a dozen times. He’s taken trips to Washington, D.C., to meet with the state’s Congressional delegation and others in the agriculture industry.

And he does all of it while operating the 109-year-old ranch that’s gearing up for its annual production sale April 2 in Bowman. They’ll be selling about 180 bulls that day, as well as 1,000 of their customers’ bred heifers.

“It’s a lot harder to get away,” he said.

As Stockmen’s Association president, Brooks has lobbied against government overreach in the country-of-origin labeling (COOL) program for marketing U.S. beef, helped ensure a beef checkoff rate increase from $1 to $2 a head to help with the program’s long-term sustainability, represented southwest North Dakota landowner interests in a debate against the Bureau of Land Management over the classification of the sage grouse as an endangered species, and lobbied against the controversial Waters of the U.S. rule that would allow the federal government, namely the Environmental Protection Agency and the U.S. Army Corps of Engineers, jurisdiction over most of the nation’s bodies of water — including waters on private land.

The most recent issue he’s working through is how a change in state tax law has affected the way counties can charge property tax on those leasing state school land, which is done mostly for use as pasture.

“We’ve been working on some of that to get that straightened out,” Brooks said, adding the Stockmen’s Association is seeking the state attorney general’s opinion on the matter.

He also said the Stockmen’s Association is aiming to increase brand fees 50 cents soon because of increases in its health insurance and salaries that help keep the association competitive in the job market.

Brooks said it’s a good time to be an established cattleman in North Dakota.

“Last year was the best market we’d ever seen in the history of cattle in the U.S.,” he said. “We turn around and it’s dropped 60-70 cents a pound and we’re still in the second-best market we’ve been in.”

And at the end of the day, that’s who Brooks is — a cattleman who is doing what he can to ensure more family ranches and farms stay afloat.