| | How do I price my straw?
The value of straw in a field is surprisingly complex. Straw’s value depends on the crop grown, the propensity of the field to erode, the amount of residue on the field, soil organic matter and fertility level as well as the value of straw for bedding or feed. A producer may decide to bale straw because there is a strong demand in his area from livestock producers. His pricing decision may be based on the value of the fertilizer needed to replace the nutrients normally supplied by the straw. Additionally, he may attach a risk factor value to cover erosion potential. Decisions such as these need to balance short-term economic benefits against long-term productivity losses.
Alternatively, straw may be baled just to handle the heavy residue of a bumper crop. In this case, the straw value can be discounted by the cost of additional field operations to handle the residue or the value of having an earlier emerging crop in the spring. Most grains produce between 40 to 60 pounds of straw per bushel. These values can be used to determine how many extra tillage passes may be required in the spring to handle the crop residue.
What does it cost to replace the nutrients removed with straw?
The cost of fertilizer to replace straw removed from a field depends on the crop. Based on projected prices for this fall’s fertilizer for N about 56 cents per pound, P2O5 around 59 cents, K2O at 51 cents and S at 55 cents per pound, wheat straw is worth about $26 per ton, barley, oats and pea straw are similar at $34 per ton and canola straw is worth about $26 per ton. These prices do not include baling costs.
Baling costs run $10 - $15 per large round bale. Hauling and stacking large round bales in the field will add another $2.00 to $3 per bale. Small square bales will cost between 80 cents and $1.00 to bale. Hauling and stacking small square bales in the field will add a further 70 cents to a $1.00 per bale to the cost. Often, you find a convenience factor of approximately $1/bale attached to small square bales. This is the value that acreage owners will attach to the bales to reflect the convenience in handling the small packages.
Straw can also be valued according to its feeding value. Using current values for grass hay of around $160/ton, wheat straw should be worth about $75/ton, barley straw around $80, oat straw approximately $100, and pea straw almost $140/ton. Baling, stacking and hauling costs will have to be added to these prices and when they are, the total price per ton will approach good quality hay prices. Consequently, the straw will have to be discounted to account for this.
The above costs represent only a base upon which to value straw. Straw prices will vary considerably between regions of the province. Other factors involved in straw pricing include local demand, soil erosion potential and possibly carbon sequestration.
If you need more information pricing, do not hesitate to contact the Ag-Info Centre at 310-FARM (3276).
Direct Seeding: Estimating the Value of Crop Residues
Prepared by Ted Nibourg, Ag-Info Centre, Alberta Agriculture and Rural Development |
|