Accurately pricing corn silage can be a challenge for the many Midwestern producers who buy and sell the feed ingredient.
"There are few, if any, published market prices," said Warren Rusche, SDSU Extension Cow/Calf Field Specialist. "Plus, once harvested, corn silage is not easily or cheaply transported to other markets."
Close to home, he explained that corn silage has been a staple diet ingredient for dairy and beef herds throughout the Midwest for a number of very good reasons.
"Properly harvested corn silage is an excellent forage resource that can be used in a number of feeding situations. A large quantity of feed can be harvested from a relatively small land area in a short period of time, especially with modern corn genetics and silage harvesting equipment," Rusche said.
Rusche said there are two basic approaches to pricing corn silage; either valuing corn silage based on the cash corn market, or based on nutrient composition compared to some other feedstuff.
Valuing Corn Silage Based on Corn Prices
A rule of thumb that has been commonly used, is to multiply the cash price of corn by 10 and use that value as the price per ton of corn silage at the time of feeding. "Although this method is quick and easy, it relies on assumptions that may not be true for every situation," Rusche said.
He added that a more precise tool is often called for, especially when negotiating a fair value for corn silage between two parties.
Jack Davis, SDSU Extension Crops Business Management Field Specialist, has developed a spreadsheet tool to help producers estimate silage values more accurately.
Through this tool, corn silage value is estimated using the estimated yield and price of corn, expected harvest costs for both silage and grain, the value of the stover either in the field or baled, as well as estimated silage dry matter and shrink losses. Example corn silage values are shown in Table 1.
Estimating Silage Value Based on Other Feedstuffs
In some instances Rusche said comparing the value of corn silage to some other feedstuff is more useful.
The most appropriate way to make this comparison is compare feedstuffs based on the cost of nutrients on a dry matter basis. The example in Table 2 shows the estimated value of corn silage when compared to alfalfa hay for net energy and protein using the SDSU Extension Feed Cost Calculator tool found at iGrow.org.
As with any sale, purchase, or pricing decision, individual circumstances can have a great deal of influence over the final value, Rusche explained. "For instance a dairy or feedlot might be willing to apply manure on the fields that were chopped for silage. That would compensate for the organic matter contained in the stover and could change what would be acceptable price levels," he said.
Other factors such as local feed supply and demand, availability of other feed or harvest options, and logistical details such as trucking expenses need to be considered to determine a silage price that works for all parties.