Profitable agriculture: fiction or a problem that can be solved? Grain storage and transportation services – cooperation with G.R. Agro
When farmers harvest a crop, the question is “how to sell and transport it profitably?” becomes very relevant, because in modern agriculture for the effective operation of enterprises, both an expedient cultivation and collection technology, productive equipment with low fuel consumption and product losses, and economic storage of grain and the correct setup of the logistics chain are needed.
However, every farmer can find profitable sales routes as there are many offers on the market. Large consignments of grain can be profitably sold for export, but there are many nuances of cooperation with exporters.
A company that provides services for the transportation and sale of grain to world markets will help you to seamlessly sell crops both in the domestic and foreign markets, which will solve all issues related to the organization of the implementation process – from delivery to final settlement.
Therefore, his experience of cooperation with G.R. Agro in the season 2021/2022, which provides a full range of services for the purchase, storage, transportation and sale of crops as processors within the country and abroad, shared the manager of the farm of LLC “ALSO Ingulets Ukraine”, – Sergey Surovy (LLC “AGROLIGA”, PSP “EDELWEISS 2”).
Farms cultivate 4,000 hectares in the Dnepropetrovsk region, in particular, the Shirokovsky and Apostolovsky districts.
Distribution of arable land fund: LLC “ALSO Ingulets Ukraine” – 2000 hectares, LLC “AGROLIGA” – 1300 hectares, PSP “EDELWEISS 2” – 700 hectares.
The first farm was acquired by ALSO Ingulets Ukraine in 2015.
According to Sergei Surovy, the enterprise was insolvent, the equipment was in the bank, the debts were not paid.
“The enterprise was insolvent, the equipment was in the bank, the debts were arrears. Good farms don’t sell, we understand that!”
The first sowing and harvesting campaign of FG “ALSO Ingulets Ukraine” was held in the 2016/2017 season. Due to the insufficient number of personnel and the fleet of necessary equipment, the results of the company were not satisfactory.
LLC “AGROLIGA” and PSP “EDELWEISS 2” were acquired in 2016.
What are your plans for expanding farms?
We are planning expansion all the time. We consider enterprises for acquisition as a whole. Unfortunately, not everyone meets our parameters.
WE MUST BE SAFE IN EVERYTHING. First, there should be a good story for us on judicial issues, on banking issues.
Second, it is important to what extent the contracts are concluded correctly. Very often agricultural producers have a mess with contracts. And the third thing is infrastructure, fields…. If the first 2 points have not passed, then we do not consider the third stage.
What geography of territories in Ukraine interests you in terms of expansion?
We plan to expand to the north – Chernihiv region. We watched a lot of enterprises, incl. and unclaimed land, the entrance to the share. But we haven’t decided yet. This region is of interest because of precipitation. For sowing corn, sunflower, soybeans.
Today the enterprises employ 6 machine operators, 3 accountants, a mechanic and an engineer, as well as several seasonal workers.
The seasonal attraction of services of contractor companies on an ongoing basis for certain types of work: transportation of grain, hiring transport for harvesting.
Now the farms grow the main crops – sunflower, winter wheat and barley – and some niche crops, in particular peas and flax.
What are your forecasts for sunflower yield?
Taking into account the precipitation year, expectations should be high. But taking into account the current state of affairs in the fields, I think that there will not be a record sunflower harvest this year. An example of 2020 is 20 c/ha, in 2019 it was 30+ c/ha. This year, I think it will be up to 30 c/ha.
The enterprises do not grow corn due to low profitability with a yield of 30-40 c/ha.
How do you feel about the cultivation of rapeseed?
We sowed it every year, but at that time we were not technologically ready. We did not reach the profitability that we would like. There is a situation that we cannot always get rape seedlings in our conditions. Now we have one farm operating under No-till technology, and from next year we plan to transfer 2 farms to Strip-till technology. I think that Strip-till specifically will help us in obtaining rape seedlings. And if we learn to do everything correctly, then our sunflower will drop out of the crop rotation altogether, and rapeseed will replace it. These are our plans for 2-3 years.
For what purpose do you sow flax?
Flax participates in the replacement of sunflower in the crop rotation every 4th year. This approach gives us an increase in the yield of winter wheat in the amount of 3-4 centners and also increases the yield of each crop during the entire period of the crop rotation. Now the share (%) of flax in the ratio to sunflower is 10/40, and in the future, we want to do 25/25. Flax has very interesting profitability. In general, flax sowing in Ukraine has fallen dramatically. We need to learn how to work with him. There are plenty of options for selling flax. Processing plants, intermediaries, oil producers, as well as the packaging of 25.50 kg and export sales. We are planning to do the packing ourselves.
The last decade of July was accompanied by precipitation, what consequences did this have for your crops?
It took place locally. Also, I do not think that the rainfall in July will have a positive effect on the yield of sunflowers. Because moisture accumulation occurs in winter. It went well for us. At the time we sowed sunflower, there was good potential. But then, this cold spring, frequent precipitation … We had late sowing this year. You need to understand the temperature of the air and soil. This crop is thermophilic. And it does not need to be thrown into cold conditions. We tried to delay the sowing period. And for us, this year is extremely late. The main sowing of sunflower took place on May 15-20. Using the “No-till” technology – we sowed on May 28.
On “No-till” I like the state of the sunflower better. Because flowering and ripening will take place in a shorter day than those sown earlier. The total daily temperature will be lower than during an active sunny day. Thus, the plants will lose less moisture to cool themselves, and they will be more busy filling the crop. Therefore, a later date of sowing specifically this year will give more results.
Where do you buy seed?
I have a very serious approach to seed. Therefore, the requirements are very serious and we are not always able to achieve the purity that we would like in terms of our storage capacity. We buy ready-made seed material up to the dressing. We agree in advance on what the dressing agent will be. Our sowing occurs at reduced rates (80-100 kg/ha, the maximum is 140 kg/ha at a rate of 200-250 kg/ha).
The suppliers of seed to the enterprises are DP “Pioneer”, Kherson region, LLC “VVI-Agro”, Nikolavevskaya region.
Tell us about the approach to sowing with reduced rates?
Why pay more if we can get by with less ?! For many years of work we reduce the rate of seeds, dressing agents, reduce logistics in the field, the cost of seeder fuel and lubricants. What do we get at the end?! A stronger, healthier plant, we have a stronger root system, because it grows in much less competition compared to other plants. What is the task of a plant? To form a crop, and not a task to survive. Seeding rate, I get a healthier plant, which is engaged in filling the crop. This plant is less susceptible to diseases, damage to pests. In addition to the profitability of the processes, we get an increase in yield. But this needs an approach. Approach to seed preparation, to prepare the soil for sowing, to the sowing unit, to the timing of sowing, nutrition. This is a whole complex. This is a system. And each element in this system performs its role.
The enterprises use plant protection products from companies – BASF, SYNGENTA.
What are your plans for the modernization and reconstruction of enterprises?
Everything must always be counted. For example, you have such a program as “Free storage” on elevators for the entire period. With such a proposal, the feasibility of building your own complex on your own territory, with the investment of crazy money, is absent. We don’t want to work for the sake of work. We are all interested in making money.
The area of outdoor storage of agricultural products at enterprises is 9000 sq.m. Basically, niche crops are stored – flax, peas. The grain group is transported for storage to the elevator.
Tell us more about Strip-Till and No-Till cultivation technologies at your enterprises.
Strip-till is a gentle tillage technology.
It provides for strip loosening to the depth of the root layer, with simultaneous fertilization.
No-Till – a modern farming system in which the soil is not tilled and its surface is covered with especially crushed plant residues – mulch.
Since the topsoil is not loosened, this farming system prevents water and wind erosion of soil, and also much better conserves water.
EDELWEISS 2 – NO Till – Season 4 – sunflower, rapeseed, wheat, peas, millet.
ALSO Ingulets Ukraine – Strip-Till – 2021 – rolling season.
The main reason for the search for new approaches to growing crops on farms was that under the existing climatic conditions they did not receive the necessary seedlings, says Sergey Surovy.
Experimental sowing was carried out in 2018 – direct sowing of wheat after sunflower using NO Till technology. Productivity was low due to systemic errors in the implementation of new approaches.
As of today, one farm has already worked 3 full moves under the No-till system – this is already a big step towards avoiding unnecessary operations in the field, applying optimal fertilizer rates. Make the soil work. Soil fertility is the main focus for the near future, because millions of years ago, nature invented a mechanism.
And we are so smart today! We decided that now we will plough, dump a bunch of nitrogen and get the harvest! For a short period of time, yes, but in perspective, no. Our fertility is lost every year. Given climate change, we are very much dependent on soil fertility and the presence of organic matter in the soil!
We can invest crazy money in fertilizers, but we may not get the desired effect. Because it just didn’t rain corny. Or we did extra cultivation and evaporated the moisture that we accumulated over the winter.
I go to the place where I can invest less in the soil but approach with an understanding of what we are doing in order to get a result. Let this result be not a record, but considering the profitability of the money invested and the benefits received. I can compete with many neighbours in terms of profitability. Some people, in order to get 6 tons of wheat per hectare and put in the cost part of the profitability of 4 tons. And I have the cost part – 2-2.5 tons.
Tell us about your collaboration with G.R. Agro. What are your main approaches to business partnerships?
We have clear security requirements. Including when choosing you as partners, we, first of all, studied your contracts, studied you as a company. In order to decide whether to put your volume in storage with you. Will we be safe or not?! We used to work with other companies. This year we decided to look for a new partner for the season. The choice is yours.
Initially, the first step was to draw up a storage agreement and bring the goods to the elevator for the purpose of further sale. Also, your company provides partial logistics for the transportation of grain from the field to the elevator. The third moment of cooperation will be the sale of the main volumes when we will choose a partner to whom to sell.
We have already partially sold G.R. Agro – 300 tons of barley. The first deal was successful. Delivered for storage to the elevator – 5000 tons of barley and about the same amount of wheat.
The enterprises of LLC “ALSO Ingulets Ukraine” and PSP “Edelweiss2” store grain at the Ingulets elevator of the company G.R. Agro. The distance between the elevator and the farms is 30 and 55 km.
Cooperation with G.R. Agro:
- Free storage of grain at the Ingulets elevator.
- Transportation of grain “field-elevator”.
- The trading grain from the elevator to the partners of the company.
A little about Youtube. How did you get the idea to shoot the content yourself? What are your plans for the development of the channel?
No-till technology is very complex. Little information. Studied technology on Youtube, what the farmer shared. So I decided to repay the debt. I have a specific audience. Because I shoot more and talk about agronomy. I show little technique. I am not a blogger as a blogger. I show only those points that may be useful for those who are interested in the topic. No show, hype. I’m more about technologists: NO till and Strip-till, what are the results, pros and cons of implementation. I do not plan active development, it takes a very long time, I cannot afford it yet.
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