ArticleVolume Number September 4, 2020

From corn producer to forage supplier?

Corn producer to be forage supplier?

2020 is a year we will all remember. Sure COVID-19 has been a major challenge but for dairy farmers, there has been a lot more going on. Add to the list a severe drought in most of Eastern Canada from early spring on. The end result is an significant shortage in forage supply. 

It is not the first drought we've seen and it certainly won’t be the last. We have seen episodes of drought in the past in specific areas of Eastern Canada (Quebec and Atlantic) but oftentimes they are regional and do not impact everyone. Neighboring regions who had been spared could supply extra forages to fill the gap. Not so much this year. This means a lot more pressure on the market. Some farms have already paid up to $380 per ton for forage from Western Canada with no guarantees in terms of quality.

Could part of the solution be right next door?

This option may not apply to everyone but…

In corn growing areas, corn producers and dairy farmers are often neighbors. Corn crops are expected to be very good in North America this fall and price isn’t as great as expected. Corn producers have a pretty good idea of the gross income they will get per acre or per hectare, based on their historical yield. What if they would sell part of their crop to a neighbor? For part of their crop, there would be some savings on combining, drying, hauling and storage. Their dairy farmer neighbor could ensile good quality corn, fill up silos, bunkers and maybe add an extra pile or an extra AgBag to make up the difference with low supply in grass silage. Just a thought.

If the interest is there, then the next question would be "At what price?". What would be a fair price for the buyer and the seller? Main factor will certainly be the expected yield as shelled corn. The nicer looking field will deliver more corn grain and more corn silage. Now would be a great time to sit down and and consider this opportunity.