As described in "6 Bulk Handling Software Tools Every Agricultural Site Should be Using," agricultural bulk handling sites can optimize profitability by automating processes. One area many bulk handling sites can improve upon is maximizing the sale price of commodity on hand based on quality.
Typically, sites will store many different agri-commodities, and these sites must separate each commodity by its various quality parameters. Wheat is sold in nearly 100 different quality levels based on its protein content, moisture, and screening (dust and other materials). Different quality wheat sells for different prices.
When commodities are delivered to the bulk handling site, the site operators determine where the commodity should be stored. To maximize profitability, site operators look for opportunities to mix deliveries coming in with commodities on hand, without adversely affecting the quality levels of the commodities on hand. It is not unusual for a site operator to err on the side of caution when making these decisions.
Because operators must carefully control and recalculate the average quality level of site stock as deliveries are made and as stock is sent out for delivery, they will take steps to ensure the average quality level doesn't dip too low from the threshold they are trying to maintain. To lessen the risk of lowering the overall quality of a commodity on hand too much, operators may add a delivery of an incoming commodity to a stock of commodity on hand that has a lower quality level, perhaps sacrificing the relatively high quality level of the delivery. In those situations, they are giving it away. With software that automates decisions on where to store delivered commodities for optimal financial benefit, sites can maximize profitability.
With control software that includes smart binning functionality (also called dynamic bin allocation), the site operator can get the best prices for the quality of commodity on hand. The control software calculates opportunities to mix a lower quality commodity with an existing quantity of a higher grade, without adversely affecting the higher quality of commodity on hand.
Assume an agricultural bulk handling site stores multiple quality levels of wheat:
Normally, without control software, this truck would be directed to deliver the cargo to the site’s HW2 location. But, with control software, the site operator determines that he can have this HW2 wheat delivered to his HW1 stock without adversely affecting the total quality of his on-site HW1 stock.
Without the control software, the operator would normally put this delivery into the HW2 category. By leveraging the benefits of bulk handling control software, the operator is paying the grower for a lower quality of wheat, but then able to sell it at a higher quality level and higher price. Because the operator doesn’t know the quality of the cargo coming into his site until it is sampled at Station #1, this on-the-spot, detailed level of mathematical calculation is not possible without automation, particularly when you consider peak harvest times with multiple deliveries happening at sites.
As agricultural production continually increases due to growing global population, bulk handling sites should look for ways to optimize operations and resources, both people and equipment. Automating processes is key to this optimization. Learn how Eka's bulk handling systems enable grain facilities to operate more effectively through the use of automation.