Corn stover has been a source of winter feed for beef cows in Iowa for many years. Recently, stover has become a potential feedstock for making cellulosic ethanol, as well. Both uses, as well as the recent dry weather, have impacted the market value of stover.
Whether you are buying corn stover or selling the baled stalks from your fields, how do you put a price on it? "The value of corn stover can be derived in several ways," says William Edwards, an Iowa State University Extension farm economist. He provides the following information and guidelines to help you run the numbers.
How to establish the value of corn stover; it can be difficult
* The minimum price is the cost of corn stover removal from the perspective of the seller, the corn producer. These costs include the cost of harvesting the stover unless the buyer does the harvesting. These costs also include the added fertilizer expense to make up for nutrients that are removed from the field along with the stover.
* The maximum price is the potential value of the stover to the buyer.
For stover that is to be used for biofuel, this value is tied to the prices of crude oil and gasoline, as well the prices of other biofuels.
For stover used as supplemental livestock feed, the maximum price the livestock producer can pay is the value of the alternative feeds replaced. The negotiated price for the corn stover should be somewhere between the minimum and maximum values.
Considerations in determining the feed value of corn stover
When supplemented with protein, vitamins and minerals, stover can supply the nutritional needs of cows that are in moderately good body condition during fall and early winter.
~~~PAGE_BREAK_HERE~~~The obvious advantage of using corn stover is its wide availability and low cost. Corn stover can substitute for medium-quality mixed hay in a ration for wintering beef cows, if a protein supplement such as dried distillers grain with solubles, or DDGS, is added.
Dry weather and reduced forage and corn production in 2012 have driven both hay and DDGS prices to near record levels, causing stover prices to increase, as well.
Considerations regarding the biofuel value of corn stover
For biofuel production, purchasers of stover would have to take into account current and future ethanol prices as well as the operating costs of the refinery. Standards for foreign matter and moisture content may be stricter for stover used as biofuel feedstock, too.
The cost of chopping, raking and baling corn stover can be estimated from typical farm custom rates. If bales must be transported, that cost should be included as well. A 20-mile transport is assumed in the example. Wrapping the bales with plastic netting adds about $1 per bale to the total cost.
In addition, the extra nutrients that are removed from the field and the soil by harvesting the stalks must be replaced by future crops. Removal rates have been estimated at 5.9 pounds of phosphate and 25 pounds of potash per ton of dry matter stover harvested. These rates can vary widely depending on the corn hybrid planted, yields obtained and how the stover is harvested. A forage laboratory test can be performed to find the specific analysis.
The value of the nutrients being removed can be calculated based on the cost of commercial fertilizer.
Considerations for figuring the market value of corn stover
Although market prices for harvested corn stover are not reported on a regular basis, bales are sometimes sold at hay auctions. Some auctions report prices of baled stover on their websites, which can be located by searching for "hay auction."
Recent auction prices in Iowa for corn stover have ranged from $30 to $40 per bale, according to USDA hay price reports. These sales would be mostly large round bales suitable for cattle feeding or bedding, but not for ethanol production.
For farm management information and analysis go to ISU's Ag Decision Maker site www.extension.iastate.edu/agdm and Extension farm management specialist Steve Johnson's site www.extension.iastate.edu/polk/farm-management.