Optimum Silos - Director Joel Murphy 2

On-farm storage changing the marketing landscape
Grain growers across the east coast of Australia are increasing their on-farm storage to maximise marketing opportunities and to help with harvest.
Joel Murphy, of Optimum Grain Silos and Augers, said, while on-farm storage has been critical across many years, there had been a marked increase in recent times.
He said historically, the advice given to grain growers over many years has been to sell one third, store one third and pool one third.
“That hasn't changed too much to date but the pooling of one third is no longer putting into a system of GrainCorp or Grain Flow or AWB - it is now on-farm storage.”
He said on-farm storage was particularly important at harvest time for growers that are further away from a town or depot and cannot afford the time spent delivering grain.
Many growers have utilised grain bags to good effect at harvest, but the more permanent and efficient system is to install fixed silos.
Mr Murphy said silos and an adjacent gravel pad meant growers could deliver at any time and take advantage of the upside of grain markets.
“It allows them to market things like Roundup Ready Canola better. They may be able to pick up a carry of twenty-four dollars till January and then four dollars every month. It goes a long way to paying off the storage.”
He said one of the key factors driving the growth in grain storages in the loans available in New South Wales through the Rural Assistance Authority.
“It is a billion-dollar fund, with up to one million dollars per loan for farmers in New South Wales to improve feed and fodder storage.”
“The depreciation and the tax benefits of the low interest rate, government loan has really helped to make the decision on buying grain storage and investing so heavily in such a big asset on farm.”
“There's figures that it costs around ten dollars a tonne per year in this system and you're up to eighteen dollars in a GrainCorp system so you are essentially making eight dollars before you even make money on your grain.”
“The risk factor is very low with those low rate interest loans. It has allowed farmers to have a longer-term view on these assets and still be able to plan ahead for their business.”
Mr Murphy said the flow-on effect to small businesses in New South Wales was also important, with people being employed in the manufacturing, transport, fabrication and labour industries.
Optimum Grain Silos and Augers have been selling and installing Cyclone Silos for more than 40 years.
Many of the original silos are still being utilised and across the decades Cyclone installations have included large industrial jobs for major grain receival companies through to many on-farm projects.
Mr Murphy said Australian made steel, local engineering and manufacturing meant the Optimum products were of a very high quality.
“We design for on-farm storage but it is essentially commercial gear. We use a six point two millimetre or four point six millimetre line pipe for our augers,” he said. “It is going to last. The flighting and the pick-up points are five millimetres and the segmented flighting, they're five millimetres to the edge.”
“As a comparison, imported augers often have a one point two or a one point seven mil wall thickness.”
"Expecting a clearly inferior imported product to perform over time, over that sort of twenty-year, thirty-year lifespan, is misleading.”
“We've been in the business for a long time and I plan to be in it for the next generation. We're not willing to make a product that we have to go back and fix in five years’ time. We want to see that same product working in thirty years’ time.”