Maize for anaerobic digestion – how do the numbers stack up?

Growing maize to supply a local anaerobic digestion plant may look attractive for farmers in the right location, however haulage costs and yield variability can “make or break” profitability

That’s why one expert advises farmers to consider all the economics carefully before signing up to any agreements.

About 70,000ha of maize is grown for anaerobic digestion (AD) in the UK each year, equivalent to almost one-third of the total maize area, with a large proportion of AD crops in the south and east of England.

See also: Triple-use maize variety on offer to support rising interest

Expectations are that this area will increase in future years if a number of proposed new gas-to-grid AD plants come online, many of which source maize from local growers to help meet feedstock requirements.

In the right situations, Hutchinsons farm business consultant, Leo Page says AD maize can be a profitable option, adding diversity to the rotation, and sometimes including the return of digestate back onto the land, to build soil nutrition, organic matter and help feed soil biology.

However, the past two seasons have highlighted just how much yields – and therefore profitability – can fluctuate depending on the weather, while haulage distance from field to AD plant can also make a big difference, says Leo.

“For many maize growers, distance and haulage costs are really what makes or breaks the viability of growing maize for AD.

“As a general rule of thumb, for every extra mile you have to travel between the field and the AD plant, you should deduct roughly 60p/t of freshweight, assuming you’re doing the haulage yourself. That equates to about £25/ha off your business surplus (net profit) for every extra mile.”

So, for example, if a farmer is growing maize 10 miles away from an AD plant and is making a net profit of £250/ha before haulage, that would be wiped out once transport has been included. 

Leo acknowledges that budgeting for maize can be much harder than for other arable crops, with enormous variability depending on growing conditions, land suitability, the weather, yield potential, grower experience, as well as transport distances.

© Tim Scrivener

Some of these variations are illustrated in the table (below), which sets out example costings for a farmer supplying maize to an AD plant. It shows how much impact variations in yield, price, and haulage distance can have on the business surplus.

Another difficulty when evaluating the viability of growing AD maize is the wide differences in supply agreements with AD plant operators, Leo notes.

Some plant operators may do the haulage themselves, some will offer a price net of haulage costs, and others may offer a delivered price per tonne of dry matter, or freshweight, with a sliding scale should crops come in above or below a target level.

In all cases, he recommends farmers look carefully at what is being offered and consider how confident they are in meeting the yield and quality targets required to make a profit.

Other considerations

Leo reminds growers that there is a range of other factors to consider when assessing the viability of growing maize for AD, and highlights some key questions to think about:

• Will it bring beneficial diversity to the cropping rotation?
• Is maize a better break crop than other options, such as OSR, pulses, or SFI?
• Is it an appropriate use of your land/soil?
• What will be the impact on soil health and structure – will remedial cultivations be needed?
• What will be the impact on timeliness of establishing following crops?
• Are there options to mitigate the risks (such as undersowing grass, early varieties, following maize with a spring crop)?
• What will growing maize do to other crop areas and the fixed costs associated with these? For example, will machinery costs be spread over a smaller wheat area, raising the cost of production/ha or tonnes?
• How important is having digestate on your land? What are the risks versus rewards?
• How far will maize need to be transported, and what will that cost?
• How confident are you of achieving the dry matter and freshweight yields needed to deliver a positive margin?
• Does maize help spread workloads or create more pressure in the autumn?
• Does maize fit into the long-term vision?
• What will be the impact on farm labour?

“Anyone planning to grow maize for AD needs to be certain it is a worthwhile option for their farm, and take time to evaluate the impact it will have before accepting any offer to grow it to supply an AD plant,” Leo concludes.