Plotting for Profit

It has been said a financial portfolio should be diversified to protect the investment and cast a greater net for profit.  We do something like that on our farm even though on the surface we may not seem very diverse.  Yes we raise corn, soybeans, popcorn, and wheat.  But break it down further to find we raise dent corn, waxy corn, commercial soybeans, soybeans for seed, popcorn, and wheat.  The waxy corn offers a premium price over dent and producing soybeans for seed companies ups the profit margin as well.  Popcorn is very much like growing any other corn, but the potential for more profit is likely. But there is another way we make money.

The color variance in this photo is from different corn varieties in one of our dealer test plots.

We set aside acres on our farm each year for test plots of various types.  There are several ways we can make more money off test plot acreage than we can on a given acre of normal crop.

Popcorn Plotting

Weaver Popcorn has come to us for space to run test plots for quite a few years.  They seem to like working with us, and we think the same of them.  They pay us a rental fee for the acres they use.  Plots used to be 6 acres.  One year it was 9 acres.  The last two seasons they have put out 12 acres on us, and I think they are doing the same this year.  Weaver provides the seed, plants it, fertilizes, and harvests the plot.  We only do the tillage ahead of planting as we do the rest of the field.  Most years we get to keep the harvest which is generally one truckload of popcorn.  Sometimes they have something experimental or a crop other than popcorn that does not allow us to keep that harvest.  So most years the only cost we have in the popcorn plot is the tillage pass.  The profit comes from the rent, free seed, and keeping the harvest.  In return Weaver gets data from the thousands of tests they run on our acres.

Seed Dealer Plots

Over the last few years we have started putting out plots for two of our seed dealers.  These plots work a little bit differently than the popcorn deal.  We do all the field work and crop management.  Planting these plots takes a little bit of our time, but it isn’t too bad.  The dealer and agronomist come out and help us load and clean the planter for each run.  These plots are field scale.  Much simpler than the popcorn plots.  The popcorn will take them a full day to plant just 12 acres and maybe 3 days to harvest.  In normal operations we’ll do those operations in a few hours.  Other than a small investment of extra time for planting and harvest we treat these like plots like the rest of the field around them.

Custom built vac system to clean the planter out with removing the seed boxes. We have now built one of our own to save time between crops.

Since we have a 24 row planter and a 12 row corn head the planter is usually split in half dedicating 12 rows to each variety.  We’ll run a full pass through the field or stop short somewhere in the middle depending on how big the plot needs to be or on how much seed they have for the test.  The planter meters are vacuumed clean of seed, we reload with two more varieties, and head back down the field the other direction. Then it’s just repeat until the plot is done. With GPS mapping I have a digital record of where each variety is planted.  The combine will automatically know what it is harvesting when the time comes.

For these types of plots the seed dealer is just looking for the raw data from our yield monitor.  Of course since we are harvesting we can analyze this data for ourselves.  The agronomist may ride along and take notes during harvest.  Sometimes we’ll weigh out each pass on the grain cart, but they are really after our GPS yield data.  So with these plots we aren’t getting rent and we are doing all the field work.  But we are getting the seed at no cost on a few acres, and the harvest is ours to sell.  Take into account our seed cost for corn is over $100 per acre.  That works out pretty well over the 30-40 acres we’ll do for two different dealers.  Last year we even got one free bag of seed for each variety in the plot.  So that gives us free seed on a few more acres.  A bag of corn seed plants roughly 2.5 acres.

A Monsanto Plot

In 2014 a local Monsanto employee reached out (though this blog!) to see if we wanted to have a 20 acre plot.  Similar to the popcorn plot this corn plot had many small blocks testing many varieties.  They planted and harvested the plot, and we performed all other field work.  They paid us a rental rate for the acres and we also got to keep the harvest.  Just like popcorn we need to keep a truck on site for them to unload their combines.  I recently received word from Monsanto they want to run another plot on us this season.

Allowing for the space and extra time to get these plots on our farm gives us a nice financial boost which is much appreciated as we continue to navigate low grain prices in the wake of two big harvests in 2013 and 2014.

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