Maximizing Profits Through Grain Quality

Grain quality is a cornerstone of success for storage companies, elevators, and feed mills—especially in today’s uncertain market conditions. This session will highlight how regular inspections, careful monitoring, and timely interventions can help maintain commodity value and prevent losses. Attendees will learn fumigation safety best practices, how to choose the right fumigation provider, and strategies for marketing a bug-free commodity. Presenters will also share how simple steps like turning grain and monitoring condition can reduce risk and protect quality. By prioritizing grain quality, operators can maximize profitability while ensuring a safe and reliable product.

Speakers:
Perry Nettles, Director of Business Development, Ecolab
Alex Luce, Business Development Manager, Ecolab

Transcript

1. C O P Y R I G H T G E A P S E X C H A N G E 2 0 2 6 C O P Y R I G H T G E A P S E X C H A N G E 2 0 2 6 HOW FUMIGATION INCREASES PROFITS Analyzing the Correlation Between Grain Fumigation and Return on Investment (ROI)
2. C O P Y R I G H T G E A P S E X C H A N G E 2 0 2 6 C O P Y R I G H T G E A P S E X C H A N G E 2 0 2 6 Download the Conference App
3. C O P Y R I G H T G E A P S E X C H A N G E 2 0 2 6 C O P Y R I G H T G E A P S E X C H A N G E 2 0 2 6 HOW FUMIGATION INCREASES PROFITS Analyzing the Correlation Between Grain Fumigation and Return on Investment (ROI)
4. C O P Y R I G H T G E A P S E X C H A N G E 2 0 2 6 C O P Y R I G H T G E A P S E X C H A N G E 2 0 2 6 Perry Nettles D I R E C TO R o f B U S IN E S S D E V E L O P M E N T
5. C O P Y R I G H T G E A P S E X C H A N G E 2 0 2 6 C O P Y R I G H T G E A P S E X C H A N G E 2 0 2 6 ALEX LUCE B U S I N E S S D E V E L OP M E N T M A N A G E R
6. C O P Y R I G H T G E A P S E X C H A N G E 2 0 2 6 C O P Y R I G H T G E A P S E X C H A N G E 2 0 2 6 HOW FUMIGATION INCREASES PROFITS Analyzing the Correlation Between Grain Fumigation and Return on Investment (ROI)
7. C O P Y R I G H T G E A P S E X C H A N G E 2 0 2 6 Once grain enters a storage structure, that is the best quality that grain will ever be • Carol Jones Oklahoma State
8. C O P Y R I G H T G E A P S E X C H A N G E 2 0 2 6 The Profit Killers Illustration of How Stored Product Pests Feed on a Grain Kernel. 1. Internal Feeders (Borers) • Angoumois Grain Moth • Lesser Grain Borer • Rice & Granary Weevils 2. External Feeders • Indian Meal Moth • Flour Beetles • Sawtoothed Grain Beetle 3. Mold Feeders
9. C O P Y R I G H T G E A P S E X C H A N G E 2 0 2 6 C O P Y R I G H T G E A P S E X C H A N G E 2 0 2 6
10. C O P Y R I G H T G E A P S E X C H A N G E 2 0 2 6
11. C O P Y R I G H T G E A P S E X C H A N G E 2 0 2 6 C O P Y R I G H T G E A P S E X C H A N G E 2 0 2 6 PREVENT COMMODITY LOSS Pests and microorganisms can cause significant physical damage, leading to clumping, "hot spots," and weight loss. Fumigation helps stop this degradation IDK, preventing the grain from being downgraded from human-food grade to animal-feed grade, which would result in a substantial financial loss.
12. C O P Y R I G H T G E A P S E X C H A N G E 2 0 2 6 C O P Y R I G H T G E A P S E X C H A N G E 2 0 2 6 Outcome Assessment Timely adjustments based on monitoring maintain cost- effectiveness and optimize profits Economic Impact Evaluating fumigation results ensures treatments successfully reduce pests and minimize losses. Regular monitoring of pest populations helps detect infestations early and guides effective control measures Monitoring
13. C O P Y R I G H T G E A P S E X C H A N G E 2 0 2 6 C O P Y R I G H T G E A P S E X C H A N G E 2 0 2 6 WHATS THE PURPOSE OF FUMIGATION • Reduce current pest infestation • Prevent commodity loss (idk) • Ensure food safety compliance • Increase GP/OI • Be THE supplier, not A Supplier
14. C O P Y R I G H T G E A P S E X C H A N G E 2 0 2 6 C O P Y R I G H T G E A P S E X C H A N G E 2 0 2 6 Calculating Fumigation ROI Cost of Fumigation • Assess all direct and indirect costs involved in fumigation processes to determine total investment. Financial Gain from Reduced Loss • Calculate the total financial benefit from preserving grain quality and volume after fumigation vs some product loss or grade. Accurate ROI Measurement • Include all relevant costs and benefits for precise and realistic ROI calculation.
15. C O P Y R I G H T G E A P S E X C H A N G E 2 0 2 6 C O P Y R I G H T G E A P S E X C H A N G E 2 0 2 6 • USDA/FGIS standards: wheat can be downgraded to U.S. Sample grade if live insect thresholds are exceeded. • Insect-damaged kernels (IDK) lots with ≥32 IDK per 100g risk Sample grade at many buyers. • Local elevator discount schedules apply per-bushel penalties for IDK/infestation and other quality factors. COMPLIANCE & GRADE RISK
16. C O P Y R I G H T G E A P S E X C H A N G E 2 0 2 6 C O P Y R I G H T G E A P S E X C H A N G E 2 0 2 6 • Stored wheat volume: 5,000,000 bu • Cash price: $5.15/bu • Loss scenarios from insect activity: 0.5%, 1%, 2%, 5% of volume value • Fumigation cost range: 3.1 – 3.9 cents/bu • Post-fumigation residual loss assumed at 0.5% for ROI example SCENARIO ASSUMPTIONS
17. C O P Y R I G H T G E A P S E X C H A N G E 2 0 2 6 C O P Y R I G H T G E A P S E X C H A N G E 2 0 2 6 128750 257500 772500 1287500 0 200000 400000 600000 800000 1000000 1200000 1400000 0.50% 1% 3% 5% Loss ($) Commodity Loss from Insects (by loss rate) 5 million bu
18. C O P Y R I G H T G E A P S E X C H A N G E 2 0 2 6 C O P Y R I G H T G E A P S E X C H A N G E 2 0 2 6 Fumigation Cost vs. Avoided Loss (2% → 0.5% scenario) 0 50000 100000 150000 200000 250000 300000 350000 400000 450000 500000 Avoided loss Fumigation (low) Fumigation (high)
19. C O P Y R I G H T G E A P S E X C H A N G E 2 0 2 6 C O P Y R I G H T G E A P S E X C H A N G E 2 0 2 6 ROI Summary 2% → 0.5% loss reduction Avoided loss: $468,750 Fumigation cost (low): $155,000 → ROI: 2.0x Fumigation cost (high): $195,000 → ROI: 1.4x
20. C O P Y R I G H T G E A P S E X C H A N G E 2 0 2 6 C O P Y R I G H T G E A P S E X C H A N G E 2 0 2 6 Insights from a fumigator • Concrete elevator vents • Stop leaning over edge • Uncle Larry syndrome • Get the lift • Maximize lift rental costs • Elevated maintenance activities • Concretes without air can be challenging to treat
21. C O P Y R I G H T G E A P S E X C H A N G E 2 0 2 6 C O P Y R I G H T G E A P S E X C H A N G E 2 0 2 6 • Don’t trim the tarps • Saves on poly, labor and sand • Bigger tanks are more cost effective for fumigation • Lower cost per bu • Bundle more locations together • Smaller elevators can join forces Insights from a fumigator
22. C O P Y R I G H T G E A P S E X C H A N G E 2 0 2 6 C O P Y R I G H T G E A P S E X C H A N G E 2 0 2 6
23. C O P Y R I G H T G E A P S E X C H A N G E 2 0 2 6 C O P Y R I G H T G E A P S E X C H A N G E 2 0 2 6 WE WANT YOUR FEEDBACK! Complete a short survey about this session to help us plan for next year. WIN A GEAPS PRIZE BUNDLE! For every survey you submit, you will be entered into a drawing for a complimentary registration to the GEAPS Leadership Conference and a $200 gift card.