August 4, 2000

An Offer They Couldn’t Refuse

Hill County Extension agent and corn producer, Bill Buxkemper (left), discusses
the progress of the silage harvest with Erath County dairyman Alan Vander Horst
at a silage pit near Hillsboro in early July.

By Lana Robinson
Field Editor

What started as a whirlwind romance between Erath County dairymen and Hill County corn producers this spring has resulted in a long-term commitment between the two in terms of silage production. Hill County Extension agent and corn farmer Bill Buxkemper said it was a proposal he and fellow corn producers could hardly turn down.

“The dairymen were using alfalfa out of Kansas, but they really preferred silage. Hill County was the closest area to the dairies that could consistently produce silage in the volume they need. We had two or three meetings with the dairymen, ironed out the details, and made a commitment for 20 years. In turn, they have spent $800,000 to $1 million putting in silage pits, buying trucks, etc,” said Buxkemper.

The remarkable thing is, the Stephenville-area dairymen waited until well into the crop year—May 10—to pop the question. Although Buxkemper had been flirting with the idea for several years, and had made earlier overtures towards these dairy farmers on behalf of Hill County corn producers, the sudden change of heart was unexpected.

“We had been thinking about it and knew if we were going to do something, we’d better do it quick, or we were going to lose another year,” said Alan Vander Horst, one of the dairymen involved. “The area around Stephenville is better dairy country than corn country. They can grow corn, but not consistently, and the quality is not as good. We wanted to have more control. We broke up the responsibility between us and got it done.”

Vander Horst, Klas Talsma, Donald DeJong and Willie DeJong, who collectively milk about 12,000 cows, were eager to seal the relationship.

“We feed our cows silage for carbohydrates and energy,” Vander Horst explained.

When first approached, Bux-kemper immediately contacted six or seven farmers capable of committing some acreage to the dairymen.

“They (dairymen) said they needed 100,000 tons initially, and I knew we needed 6,000 to 7,000 acres to get that kind of yield. It’s funny. There was not a whole lot of interest by farmers here at first, then we hit a dry spell, and interest picked up. Then we had a five inch rain, and interest dropped again,” he recalled.

Before tying the knot, a handful of silage producers got together to discuss such issues as transportation costs, including mileage to the pit; when to cut the silage (ideal percent moisture); what kind of price they could expect per ton; how to structure the first-year contract and future contracts; whether or not it was to their advantage to negotiate a contract that paid by the acre or by the ton; what would happen if they were unable to deliver (act of God); and a payment schedule.

Like all good marriages, it required give and take from both sides. Hill County farmers this year agreed to pay part of the transportation costs. They agreed on $14/ton (average yield is 14 tons to the acre). Every load is weighed before going to the pit. Price is based on tonnage and percent dry value, 25 percent being optimum. There is a sliding pay scale if it gets dryer. Producers had the option of being paid 10 days after harvest or in monthly installments. Some elected to take it after the first of the year for tax purposes.

Some sold land to the dairymen to build pits on. Others, like Hill County Farm Bureau Vice President Blair Russell of Abbott, negotiated a 20-year lease on a silage pit site. The dairy alliance constructed five pits in strategic locations in Hill County—Aquilla, Chatt Road, Bynum, Loveless Community and midway between Itasca and Osceola.

The pits are massive, requiring 85 trucks to transport the walls to Texas from Wisconsin.

“I’d say the pits are 40 feet high at the center, but the walls are only 16 feet,” said Russell. “They’re supposed to have a 20,000 ton capacity, but they have 40,000 tons in them.”

“That original estimate of 100,000 tons has since grown to 150,000 tons,” Buxkemper noted. “Now we have about 40 farmers representing 10,000 acres participating. In the end, we had to turn away some farmers. Farmers who participated this year will be first to go in next year.”

“You really have to live within eight to 10 miles of the pit. They don’t want to cut 17 miles away. The transportation costs are too high,” Russell added.

Custom harvesters from Oklahoma arrived with 10 to15 choppers and between 75 and 100 trucks in late June.

“They started at Aquilla, which grows off faster, and worked their way north,” said Buxkemper. “As the harvest progressed, some of the silage from drier fields was blended with wetter fields.”

Each 30-inch row cutter is capable of harvesting 100 acres per day, the county agent explained.

Stored silage is covered with white plastic, and weighted down with tires.

Buxkemper said the long-term arrangement offers corn producers a market they can use every year. Still, he does not encourage his friends here to plant strictly for silage.

“We need to maintain our corn production,” he said, indicating that farmers always need to position themselves to take advantage of pricing opportunities. “We need that option. In a dry year with low yield potential, you can still make silage.”

Buxkemper said Hill County silage producers plan to host winter meetings with seed company representatives to advise them on corn that produces the highest grain yield and also produces the highest silage.

“Some varieties grow a little taller. We’ll probably eliminate early maturing varieties to escape aflatoxin and go with those that give you the option to go to silage,” he suggested.

Avoiding the risk of aflatoxin appeals to Russell, who was forced to shred under 65-bushel-to-the-acre corn one year because of aflatoxin.

Buxkemper said the dairymen are willing to pay farmers $8 to $10/acre more for cutting corn seven inches higher on the stalk, which results in silage more beneficial to milk production.

“Dairymen love short corn with a big ear. The carbohydrates and energy is higher,” the Hill County Extension agent noted.

It takes approximately 1,500 acres to supply 35 days of feed for the dairy cattle. In order to meet their nutritional needs, four semi-truck trailer rigs haul silage from Hill County to Erath County, 24 hours a day, seven days a week.

“Considering the complexity of this relationship, everything has gone very smooth,” Buxkemper reported.