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Corn demand drives Alberta acres up

A 60 percent increase in Alberta acres planted for grain corn in 2014 indicates growing interest in the crop for the livestock feed market.

Ron Gietz, co-author of The Potential for Grain Corn in Alberta, an Alberta Agriculture report published in late August, said some feedlots are looking to expand their purchase and use of corn for feed rations.

Among them is Lakeside Feeders of Brooks, Alta., owned by JBS Canada. At an open house last week, the facility told local producers about a new flaking mill designed for grain corn.

“They’ve been one of the big proponents,” said Gietz about JBS’s Brooks operations.

“They want to get up to 20 percent of their ration (in grain corn), is their goal. They would need in the order of 25,000 acres locally here, just to accomplish that.”

Provincewide, the report estimates grain corn consumption could reach 3.6 million tonnes, assuming it became the primary feed grain for cattle, hog and poultry diets.

Lakeside’s plans mesh with the report’s analysis, which indicates at least 40,000 acres of grain corn were planted in Alberta this year. However, some regional agronomists say the real area is closer to 100,000 acres.

Interest in production is sparked by new corn varieties that need fewer heat units to reach maturity.

Monsanto and DuPont Pioneer have both invested in research facilities to develop varieties suited to Western Canada.

Adrian Moens of AJM Seeds in Coalhurst, Alta., who is also a DuPont Pioneer representative, said he has noticed more local interest in growing corn for grain but variety development will be key.

“Definitely the amount of grain corn that is being grown compared to last year is up quite a bit. There’s a lot of guys that are interested in it, but they’re going to have to see earlier maturing.

“Interest is fairly high but practicality is still in the beginning stages yet.”

His optimism and that of major crop breeding companies were a surprise to Gietz when he and fellow report author Mandy Gabruch compiled their data.

“It was actually a bit of a surprise how optimistic some of these technology companies are about the new varieties and what they think they can do in terms of adoption,” Gietz said. “They’re investing pretty significant dollars into it.”

Varieties requiring fewer than 2,000 corn heat units to reach maturity would widen the areas of Alberta where grain corn would be viable.

Even so, those varieties will also have to deliver on yield before they will be widely adopted, he added. He estimates average yields of 110 bushels per acre will be required.

“Every crop has to earn its place in the rotation as far as it paying the bills.”

Lloyd Van Eeden Petersman of Taber Home and Farm Centre said 110 bu. is a good ballpark figure, though some growers in southwestern Alberta are happy if they break 100.

In the southeast, where heat units are higher, irrigation is available and there are other options for high-return crops, grain corn might have to produce 130 bu. per acre to attract attention.

“It depends on what you paid for the land and what it needs to pay you every year,” he said.

The Alberta Agriculture report indicates returns from grain corn are comparable to other options. Though it has higher input costs, it also has higher yield potential.

Barley acreage is steadily shrinking in Alberta, mostly due to the better economics of canola and other crops.

“If this trend of reduced local feed grain supplies continues, the competitiveness of Alberta’s livestock industry will likely suffer, as it is not economical to bring in U.S. corn over long distances to feed Alberta livestock,” said the report.

“Therefore, an alternative local feed source may be needed in the future to maintain the growth and competitiveness of Alberta’s livestock industries. This is where corn production in Alberta could fit.”

Corn has higher energy content than barley and can be fairly easily substituted in livestock diets, the report notes.

However, corn requires processing, such as flaking or fermenting, to provide maximum feed value. Corn-heavy cattle rations typically require protein supplements.

Supplements are also needed when feeding corn to hogs and chickens, although the energy value is higher than other common feed grains.

Grain corn production requires some specialized equipment, but that is not seen as a hindrance.

“Farmers have shown they are willing to invest in new machinery if that’s what they need to get the job done,” said Gietz. “It’s kind of hard to dabble in it.”

Traditional cereal seeding equipment will work for corn, but better results are achieved with row planters. At harvest, a corn header is required.

Marketing would most often involve direct sales to end users, likely livestock operations.

As the price is largely determined by supply and demand in the United States, price discovery can be complicated.

The report also said the corn futures and options market is highly liquid, reducing risk. As well, grain corn would be produced specifically for the feed market, as compared to other grains that use the feed market as a buyer of last resort.

Corn is subject to fusarium infection, although it doesn’t significantly affect yield in most cases. The fusarium threat lies in its potential to affect cereal crops in the rotation.

“That’s the risk and whether that can be managed or how that can be managed … we just brought up that issue. We flagged that as a concern,” Gietz said.

Van Eeden Petersman said the threat is manageable with residue management and crop rotation choices.

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