613 - Tips for Maximizing Pre-Pile Payment
American Crystal’s Pre-Pile Program is designed to:
- Maximize factory run time and sugar produced
- Allow shareholders to maximize their on-farm profits by maximizing acres and tons the Company can process
- Permit the early production of sugar to meet customer demand
- Provide for the gradual startup of factories
During Pre-pile, we typically we take in 15 -18% of the total tons we believe are available for processing. Investments in factories have been made to increase slice capacities. This increases the need to have a larger supply of sugarbeets pre-piled to avoid slowing down factory slice rates or preventing a shutdown. In general, we need to have a 3-4-day supply of sugarbeets on hand throughout pre-pile harvest. On occasion, more tons may need to be piled in a time period in preparation of forecasted rain events that could limit deliveries.
Storage losses on pre-pile beets is typically minimal because they are not stored for long periods, which is a positive for sugar recovery. However, on very warm days, deliveries may be limited or shut down to avoid losses from piling hot beets.
A Pre-pile Premium has been established by the Company to reasonably compensate shareholders for the lost opportunity for growth and quality of beets delivered in Pre-Pile Harvest.
- The Pre-Pile Premium is not known at the time of harvest.
- It is developed after harvest by using actual sugar growth observed from that year to determine the premium percentages
- The Pre-Pile Premium Percentage is the same for everyone for any ton delivered on the same day of pre-pile
- The premium percentage decreases for each day closer to stockpile harvest
- The Pre-Pile Premium Percentage is taken times the base payment/ton based on the quality of the beets a grower delivers and then added back on to that base payment for the total per ton payment for beets delivered on a contract for that day in Pre-Pile.
Below is an actual example from 2018 of two growers delivering on the same day of Pre-Pile.
Strategies to Maximize the Pre-Pile Payment
1. Focus on Pre-Piling fields that are least likely to improve, this captures growth in tons and sugar that is figured into the Pre-Pile Premium that would not occur at the same pace on these fields.
- Focus on your best field (high sugar and/or tons) or your worst field (low tons and/or sugar) due to disease pressure.
- Focus only on one or a couple fields.
- Makes harvest & delivery more efficient with not as much moving between fields.
- Determine what fields to focus on.
- Take samples from fields prior to Pre-Piling to run at the Quality Lab. Get bags & tags from your Agriculturist.
- Use satellite imagery to evaluate areas of the field with yellower canopy color where there is typically higher sugar content than in greener areas.
- Leave fields until stockpile harvest that have low sugar content / high N, low plant populations, or are replants to allow more time for their quality to improve.
2. Focus on fields farther away from a piling site or at higher freight rate stations.
- Hauling less tons helps save on freight costs, both on-farm and company freight costs, as tonnage is lower while still capturing the Pre-Pile growth premium.
- This requires less time and people as well.
3. Focus on fields that can be difficult to harvest in adverse conditions.
- Weather can be more cooperative during the Pre-Pile time frame.
- Take advantage of that time to avoid higher harvest costs in case Mother Nature doesn’t cooperate during stockpile.
- Harvesting during day light hours is a benefit as well.
Another Pre-Pile Option
4. Pre-Piling only field headlands and splits.
- This is a management choice and may not give the best Pre-Pile payment but adds convenience at full harvest.
- Headlands typically have poorer sugar and less tons.
- If all that was harvested at stockpile were headlands it wouldn’t provide the best payment either.
- A way to meet in the middle may be to only harvest the middle 12 rows off of a headland allowing a place to stage equipment at stockpile.
- Then move on to other fields to focus on the other strategies above.