Grain elevators banking on strong wheat harvest

? As drought lingered for more than three years in western Kansas, the Garden City Co-op scaled back its operations and cut half of its 122 employees.

The company sold its convenience store, closed its feed mill and sold its short-line railroad, said elevator manager Irvin Clubine. It retrained its remaining 60 employees so they work a variety of jobs at the elevator.

“You can’t save your way into prosperity — you got to have a crop,” Clubine said.

Until a week ago, Clubine wasn’t sure if farmers in this southwest Kansas county would have a crop this year either. The winter wheat was getting stressed in Finney County.

And then the rains came.

“That rain did a lot to help us salvage what is there,” he said. “No doubt some acres will be abandoned.”

Now he expects to see farmers cutting an average wheat crop, at least compared to the last three or four years, as long as there is no hail damage before the crop gets into the bin.

But the co-op jobs are permanently gone — those former workers have moved on to work in other places, he said.

“I don’t see them coming back,” Clubine said. “We’ve learned to do more with less.”

The Kansas Grain and Feed Assn., the industry group for Kansas grain elevators, surveyed its members in February to see how many jobs had been lost in the 18 months before the survey. Forty companies — including elevators as well as fertilizer and chemical retailers — responded. It found a 20 percent cut in jobs at those agribusinesses.

“It is not just Sprint and Boeing — certainly those companies had significant layoffs — but the layoffs we are seeing affect Small Town, Kansas,” said Doug Wareham, senior vice president for the industry group.

At the Scott Co-op in Scott City, elevator manager Doug Brown said there was no need to move grain to make room for the coming wheat harvest.

Last year, elevators in Scott and Wichita counties brought in just 5.6 million bushels of wheat — less than a third of the crop harvested in 1998. The fall harvest of corn and milo was just as dismal: just 8.4 million bushels, compared with 21.1 million bushels in 1998.

To survive, the Scott Co-op has cut overtime and hasn’t replaced workers as they quit, but has avoided layoffs so far. Many expenses, such as utilities, were automatically reduced because of the poor crops.

“If we don’t have grain production, we can’t make a profit,” Brown said, adding an adage he heard from an old farmer: “‘You can’t starve a profit into a cow.’

“You can’t cut expenses fast enough to compensate for that reduction in revenue,” Brown said.

All that is making the wheat crop now maturing in the field look “amazingly” good, he said.

“In fact it looks good enough it is making me nervous. I can just taste it,” Brown said. “We are getting close enough (to harvest) we are going to have a wheat crop. … It makes me nervous thinking bad weather or some other catastrophe is going to make it slip through our fingers.”