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In an era of higher costs and increasing competitive pressures for custom application services, Meadowland Farmers Cooperative has relied on a three-pronged strategy to maximize returns while keeping custom charges as affordable as possible.
The co-op buys the biggest equipment that is practical. It runs that equipment hard. And it uses new technologies to eke out additional efficiencies.
“Costs are up, but equipment is getting bigger and more efficient,” notes Ralph Price, agronomy manager for the nine-location co-op, headquartered in Lamberton, in southwestern Minnesota. “I would rather have fewer, bigger, better pieces of rolling stock and run it hard to maximize our labor and overall efficiency. It is cheaper to run one piece of equipment than two.”
To get more work out of these bigger, better pieces of equipment, the co-op harnesses assisted steering and digital tracking technologies to reduce operator fatigue and to assure that tender trucks are at the right place at the right time to keep applicators moving. The digital tracking system also helps reduce fill times at the co-op's central fertilizer plant.
Using these strategies enables the co-op, which has close to $200 million in sales from grain, feed, seed, fertilizer and chemicals, to operate with a full-time workforce of less than 100, Price notes.
“Our efficiencies are up about a third over the past seven years,” he adds. “Labor per acre is less than it was a few years ago.”
Rolling stock options
The co-op runs a fleet of 15 self-propelled sprayers, 15 4-wd tractors pulling 60-ft. anhydrous bars and 21 floaters supplied by a dozen tenders.
The self-propelled sprayer lineup is dominated by Case IH rigs with 1,200-gal. tanks and 90-ft. booms, a good size for the 80- to 150-acre fields typical in the service area. That compares with sprayers with 600- to 800-gal. tanks and 60-ft. booms just a few years ago.
The goal for each sprayer is to cover 20,000 to 25,000 acres in a year. “If you can get over 25,000 acres in a year, that is how you maximize efficiency,” Price says.
GPS technology is an important component in achieving that goal. “We put lightbars on all the sprayers,” he says. “Some of our guys are running a lot of hours. GPS technology takes a lot of the stress out of running equipment.”
The co-op keeps sprayers supplied with water and chemicals from tandem-axle straight trucks that carry 3,000 to 3,500 gal. of water.
“We have always spent extra money for the tender trucks and an extra man,” Price says. “The chemical is ready when the sprayer stops to be filled. We have made it pretty fast to fill by going to 3-in. plumbing.”
Anhydrous ammonia application is an important part of the co-op's application business. Because of its northern geography, it handles about three quarters of its annual fertilizer business over a six-week period in the fall. Anhydrous ammonia application on about 150,000 acres is shoehorned into a three-week period just before freeze-up.
To cover that many acres, the co-op has upgraded from 42-ft. anhydrous bars to the current 60-ft. rigs pulled by John Deere 9620 and 9520 4-wd tractors, which are leased. All tractors are equipped with assisted steering to reduce operator fatigue.
The 60-ft. bars are modified John Deere 2410 chisel plows with shanks spaced every 30 in.
“These bars are heavier than what is typically used in the industry,” Price says. “Fatigue is a problem with a lot of equipment. We buy toolbars that don't break so that we are applying anhydrous, not fixing the bar. These bars cost more, but we get more work done per hour with them.”
In addition to spacing the shanks, the co-op modifies each bar by adding a winch. This simplifies hooking up anhydrous trailers, which reduces hookup time.
Digital tracking, contract trucking
The co-op's dry fertilizer application program gets a special efficiency boost from a digital tracking system. Not only does it maximize spreading efficiency, but efficiency at the co-op's new 20,000-ton blending plant is improved, too.
The digital tracking system uses software and hardware technology typically used by utilities, municipalities and delivery companies to keep track of service, delivery and other vehicles. The Trakit system from IDA Corporation (www.idaco.com) monitors locations of floaters and tender trucks and alerts the blending plant when each tender truck is returning to the plant for a refill.
“We are running many things out of one location, so it is important to know which 20 tons to have blended,” Price says. “To do that, you have to know which tender will be in next.”
The Trakit system uses the co-op's business band radios on each vehicle to transmit GPS data to a central radio tower. From the tower, special hardware transfers the GPS data through a regional high-speed wireless Internet system, which delivers the location data to a map interface on the co-op's computers. This allows dispatchers to direct tenders to the exact locations of its mix of AgChem and Loral floaters. The alarm function also notifies the blending plant as each tender returns for refilling.
The co-op also bolsters the cost efficiency of its fertilizer application program by contracting with semi-tractor owner-operators to run its fleet of 24-ton tender trailers. The company-owned trailers include gas engines to run tender hydraulics, so any semi-tractor can be used.
Moderate price increases
Meadowland customers haven't been totally insulated from custom service price increases, but efficiency gains have helped keep prices down, Price says. Over the past three years, dry fertilizer and anhydrous application charges have gone up about 40%, while rates for spraying have climbed 25%.
“A lot of the services we provide, farmers could do themselves,” Price notes. “We have to set a reasonable price so they can afford to hire us. Our application business still has to be a profit center, but we also recognize its role in tying customers into other services we provide.”
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