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Building a state-of-the-art grain elevator
17 Plays4 months ago
Join Steven Kilger, host of the Feed & Grain Podcast, in a compelling interview with Jeremy Kramer, General Manager of CHS. Discover the innovative journey behind the construction of a lights-out grain elevator in Herman, Minnesota, built amidst the challenges of the COVID-19 pandemic. From planning to execution, explore how CHS overcame construction hurdles, enhanced efficiency, and going from a 1970s model elevator into a state-of-the-art facility, setting new standards in the grain industry. Don't miss this exclusive episode offering insights into the future of grain handling and storage.
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Transcript
Introduction and Sponsorship
00:00:01
Speaker
Hello, my name is Stephen Kilgram, the managing editor of Feeding Grain magazine and the host of the Feeding Grain podcast. Thank you so much for joining me today as we dive deep into the issues affecting the feed manufacturing, grain handling, and allied industries. Today's episode is brought to you by the Binwip from New Mat Systems. The powerful dual impact Binwip removes the toughest buildup in blockages and industrial storage silos without hazardous silo entry. Learn more today at binwip.com.
Interview with Jim Kramer
00:00:29
Speaker
So today I edited an interview
00:00:31
Speaker
And I did a while back with Jim Kramer, general manager of CHS about the grain elevator. They built Herman Minnesota. This grain elevator was pretty interesting because it was built via lights out facility. Plus it was built over the COVID-19 pandemic, which gave it a whole bunch of construction challenges that they were able to overcome. It's a really neat story. So I'm really glad you're going to get to listen to it because this is an example of an interview that I would normally turn into cover story.
00:00:58
Speaker
But you'd end up getting such a small portion of what we actually talked about in that story. It's really nice that you guys will get to hear everything that we do. Thank you so much for listening to the Feeding Grain podcast. I hope you're having a great summer. And if you're listening to this in a podcasting app, please give us a review or rating. It really helps us out. If you prefer listening to this in your browser, make sure you sign up for industry watch our newsletter.
00:01:23
Speaker
and we'll keep you up to date on all the newest podcasts that are coming out. With that out of the way, thank you for listening. Now, on to the show. Why don't we kind of dive in?
Choosing Herman, Minnesota
00:01:35
Speaker
So can you guys go a little bit, go over kind of like the planning process of this elevator in Furman? The planning process as far as building the whole facility? Well, what kind of brought you to the decision of like, this is the place to build.
00:01:53
Speaker
What was the need, and how did you feel it? Sure. So we've had an existing shuttle facility in the Herman, the town of Herman, for a long time, quite honestly.
Retrofitting vs New Construction
00:02:09
Speaker
It was an elevator that we've retrofitted over the years, added some storage, added a second dump pit. But it was still a 1970s model elevator.
00:02:21
Speaker
And so it was the scale was over the pit. And anytime you have that it typically isn't as fast as the producer would like. So we looked at different ways that we could retrofit further at the location in town. And we had, we own some property just on the outside of town. We're about a mile north of Herman. We're still in city limits, but it's out on its own little parcel. And we've got a,
00:02:48
Speaker
32,000 ton for a leisure plant here in the main offices here. So we had acreage to build new and after we looked long and hard at how to do something in town, at the end of the day it was going to be expensive and we were going to really kind of get what we always had. So what this allowed us to do is start fresh and do it the right way. So we are about a mile from our existing shuttle.
Benefits of the New Facility
00:03:15
Speaker
We built another shuttle that's state of the art
00:03:18
Speaker
allowed us the speed that the farmer desires along with adding space because we could have used more upright space the way the producer takes the crop off these days. One of the things that the producer is doing is they continue to invest in efficiencies and that's both putting the crop in and taking the crop off. And so that's what the commercial, us in this case, are trying to stay ahead of as
00:03:47
Speaker
being able to make sure that we can get the fertilizer to the ground, the head of the producer, as well as the head of them as we take corn and beans off in the fall of the year. Yeah, sure. So I have noticed that it seems like, well, a lot of elevators are kind of running into that situation too, like being in a downtown location, even if they weren't once a part of town, the town has kind of evolved around them.
00:04:15
Speaker
And so you see a lot of moves a little bit outside of it, just more space, especially traffic and stuff like that. Yeah, we actually bought 50 acres, what, about 2007 or 2008. And so we've got this whole facility now that's just exactly what you described. We've got some ability to sprawl here a little bit without getting too many things on top of us. Yeah, yeah.
00:04:45
Speaker
That seems to be the way that every, I mean, especially since now people are more and more, I don't know, anti-industry in their backyard, it seems sometimes. So yeah, it seems like the people that live in town, they don't want a lot of that truck traffic. And quite honestly, the producers don't want to have to fight around town with the truck traffic. Now, in saying all that, Herman is the town of about 400 people. So it's not like it's a big city that we're trying to
00:05:14
Speaker
maneuver around. Yeah, yeah. Excellent.
Planning and Construction Challenges
00:05:18
Speaker
So can you go a little bit about into the kind of the planning of the construction phase? Okay. So CHS has its own construction department. Okay. Jim Gales heads up that department. And so I've worked with Jim for years now on various projects. So we sat down and worked through what we
00:05:44
Speaker
thought we needed for the project from a speed and space standpoint and got my department, the rest of my department involved, the green guys inside the department and put together a plan. And then we took that to various contractors and looked at, you know, what they had for lots around our plan, tweaked it, toured a couple of other facilities that had recently built and tweaked it some more. And that's how we came up with
00:06:14
Speaker
the version that we ended up building. Thanks. What were the things that you needed for this new facility? The reason for it was, again, speed and space. The producer is so quick at taking the crop off and we just weren't able to dump enough trucks per hour. We ended up, we'd have
00:06:44
Speaker
many days of long lines at the elevator just because we just couldn't get enough trucks through. And what this allowed us to do is now we've added three more dump pits. And they're high speed. So we're worried that's rated at 20 or 25,000 bushels per hour per dump pit. And we've added three new dump pits. So just the new, yeah, just the new facilities rated at 75,000 an hour.
00:07:09
Speaker
and then we can dump another 25,000 bushels an hour at our uptown location. So today, if you were able to evenly spread out to your trucks throughout our facilities in Herman, we'd be able to dump about 100,000 bushels an hour. Now, that's what it's rated at. You physically can't get that many trucks through the whole system, grading the grain and all that kind of stuff. Yeah, yeah, yeah. But it took us from
00:07:40
Speaker
a two dump pit location to a five dump pit location. So not everything is going through the hourglass in the same spot, so to speak. So we were able to, it just makes for a lot better experience for our grower. Not later in the line. It's just the state of the art. It's slick and fast. And then the second thing is the storage piece. The facility is 1.4 million bushels. So we've got 2 million bushels of space.
00:08:10
Speaker
that is currently uptown at their old facility. So we added 1.4 million to it. So now we're just under three and a half million of total space at our location. So you guys are planning to keep the other facility in kind of operation, at least for now? Yes, we'll continue to utilize it. It's not that it's obsolete by any means. Quite honestly, by doing what we did out here, we've extended the life
00:08:37
Speaker
of that one because about 80% of the grain will end up going through the new facility and will continue to utilize the old facility. It's still operational and it still provides value to us and the producer. Nice. How was the construction process? When did you guys kind of start and when did it, how did it go? Well, we started the construction in the late summer, early fall of 2019. Okay.
00:09:05
Speaker
So that's going to be, uh, Doug, the first hole and, and, uh, they, they started the whole, uh, process. The actual elevator, uh, was scheduled to be slipped the, about the middle of may in 2020. Okay. Um, and that was unique because that is obviously right kind of in the height of the pandemic getting them. And that was back when we didn't know a lot about it in may, uh, created a lot of obstacles and.
00:09:34
Speaker
and created just a lot of uniqueness to this particular facility. Yeah. Did you have anything in particular that pandemic obstacles that you guys had to get around? Yeah, for sure. So back in May of 2020, again, we were still learning about what the pandemic meant. So typically when you do a slip project for an elevator, you bring in a lot of people from outside the area.
00:10:03
Speaker
It's a specific crew that they bring in to do these because they're, they typically, they should take about six, this one should have taken about six and a half days. So they bring all these people in to do it. First, they were nervous coming in because they didn't know anything about Herman. And so what were they coming into from a pandemic standpoint? And then the local people around Herman weren't real excited about bringing people in. You know, what were they going to bring in to Herman?
00:10:31
Speaker
So we had to get through that whole thing. We ended up not getting a full employee base that we needed. So the slip, instead of taking about six and a half days, took about 12 days. And then a couple other things that we did that was unique is that we provided meals for all the employees that were on that project.
00:11:00
Speaker
It was two 12-hour shifts. So as they came on, they got a meal, and as they came off, they got them. So we fed them going on the slip in the morning at 6 o'clock, and we fed them coming off the slip and eating it at 6 o'clock. And the same thing, fed the new shift that was going on at 6 o'clock at night, and then we fed them going off the shift at 6 o'clock in the morning. And what that did is it kept them out of all the eateries in the
00:11:27
Speaker
in the towns in and around Herman. So it just, it was kind of a step we took to try to make everybody both feel comfortable that was working the project, but also the people in and around Herman that were involved in the whole thing. So ended up renting the whole hotel in Morris, so basically, you know, quarantine, not quarantine, that's probably not the right word,
00:11:56
Speaker
It kept everybody in the same area. So we did everything that we could to isolate them. And you know, worked with our local health people. We had several conference calls ahead of the slip just to make sure we had the right protocol in place and all the COVID screening and that kind of stuff. That's pretty, you know,
00:12:22
Speaker
rubber stamp now, we did all that stuff back then, every shift, we took temperatures and that kind of stuff. So it was definitely unique and it made it more difficult for sure, but we're able to get through it. Yeah, that's amazing. I mean, especially back then when no one really knew what was happening and going on.
00:12:45
Speaker
Also, I've been feeling that phase is already stressful enough to go ahead and make all these arrangements on top of it. That's quite the feat. Yes. And of course timing, we needed to get it done in May in order to get harvest in 2020. So we're trying to thread the needle there with, if it would have backed up a couple of weeks, we'd have ended up missing
00:13:12
Speaker
fall of 2020, which has been unfortunate. But as it worked out, we were able to get through everything. Thanks.
Automation and Efficiency
00:13:19
Speaker
Yeah. Very cool. So tell me a little bit about the facility itself. You've already mentioned some things, like the three dump pits and stuff. But why don't we do a thing where we, how I always like the word it is. Tell me what happens with a truckload of grain
00:13:42
Speaker
as it kind of goes through the facility. Sure. So we've got the RFID system, which I think is pretty standard. So producer comes in. He's got a card that's got his entity on it. So he swipes his card when he first comes through the system. That brings up his name. And from there, he proceeds to the probe.
00:14:07
Speaker
And we probed the grain, put the grade on the ticket. From there, he goes to our first scale. And then he swipes his card again and weighs himself. Proceeds through the facility at one of the three pits that we told him to go to based on his sample of grain. So he goes through and hits the pits. Dumps comes back through the second scale, the outbound scale, swipes his card again to weigh himself empty.
00:14:37
Speaker
and then it produces a ticket right on the scale and he's on his way. Yeah, so it's got the facilities three dump bits, like I mentioned, with 25,000 bush an hour legs taking the grain away. We've got it's 1.4 million of upright capacity with 17 total bins. There's eight big silos, 865,000 bushels in each silo.
00:15:06
Speaker
And then there's what we call intersticed bends between the round silos. So when you add it all up, there's 17 total bends at about 1.4 million bushes. All right. And we load trains on the BNs. We load shuttle trains, so 110 car trains. It's an interested in this information, but it's an 80,000 bush an hour bulk wear that we used to load out.
00:15:36
Speaker
and then the system is completely automated. Very cool. So you have your own fleet of trucks too. Do you use those to move grain between the two locations then? We'll actually use it to transfer grain from our satellite locations. We've got some towns that are 15 to 18 miles away from Herman. So as the farmer,
00:16:06
Speaker
brings grain to those locations, Chicayo and Morris, then we'll transfer them with our truck from Chicayo and Morris into the Herman market. And we also do some picked up on the farm. So if the producer wants us to haul it, we'll just take our trucks and pick it up right at their farm and haul it right into Herman. Very cool. Sorry. Just a moment.
00:16:36
Speaker
How many employees do they have on site then? At the new terminal, we only have two employees on a daily basis and then more when a train is here to load. So you have some pretty impressive automation then? We do. What I would call this, what is probably now today the standard automation where
00:17:05
Speaker
everything's on a screen to start your leg and start your conveyors. It's just clicking a mouse and you click on the leg and it starts the leg and click on the conveyor, it starts the conveyor, you click on the bend you want to go to and it opens up that slide. So all of it's all automated that way. And so you can control that from various points at our location. Over at the place where we receive grain, we've got a
00:17:36
Speaker
office there where we probe the grain we have an office and that same system can be controlled from that office and then when we're loading grain that same system also is visible and and you can control all everything I just described from our loadout building as well so it's that's the automation part so you can run it act quite honestly you could run the facility with one person
00:18:05
Speaker
with everything I just described. And you could do it from multiple locations. So on some days, we could do this with one person and be just fine. And then there's the reason for the article, I think, is the totally automated system. And so that's the piece that we're working on. Do you want to talk about that right now? Yeah, let's talk about that while we're on the subject. OK.
00:18:34
Speaker
What we're trying to put in place is a completely automated facility where there doesn't need to be anyone on site. So how that would work is, again, very much the same process as I described earlier. The difference would be when we were in the automated mode, the truck would have a little puck. And I'm going to reference guys that are almost semi. It doesn't need to be a semi, but that's how I'll describe it.
00:19:03
Speaker
So on the semi-trailer, there's a little puck that will have just behind the front of the trailer. And as that comes through, that identifies the characteristics of the trailer. And that allows us to probe when he moves from that very first kiosk
00:19:25
Speaker
into where he sits for the probe position after we go through the first time and we position the truck there and we basically teach the probe where it can probe, where it won't hit any of the bows and it won't hit any of the straps on the truck. And then it also knows how deep it can probe so it doesn't hit the bottom of the truck.
00:19:54
Speaker
So that's the that's the piece for the very first time it goes through the system. And once it does once it does that, that talk is those characteristics that I just described that goes on to that. And so now the next time that it comes through the system, it knows this is your truck, it knows that this is where it can probe, and it'll it'll randomly probe, you know, a couple of times in the front hopper and it'll randomly
00:20:24
Speaker
a couple of times in the back hopper. It'll take that grain inside the facility. It automatically puts it through our grading equipment. So it'll check the FM, check the moisture, check the test weight. And from there it creates the grade, puts the grade into our system. And then it knows that you're hauling number two yellow corn. And so what it's going to do
00:20:54
Speaker
say behind the scenes, we've got a matrix set up that basically is saying number two yellow corn goes into this particular bend.
Impact of Automation on Operations
00:21:02
Speaker
But once it's all graded, and once it's got the grade on the ticket, it tells you to proceed to hit number one, because that's where your quality of grain needs to be done. Wow. And the rest of the system is the same, hits the scale, et cetera, goes through the system. We've got some
00:21:24
Speaker
checks and balances in place. Again, that puck reader, if you would happen to get into the wrong line. So let's say we tell you to go to pit number one, and you get around there and you forgot what pit you were supposed to go to, and it's in pit number two. That puck reader helps decipher that because we've got puck readers throughout the process. And before it comes into the pit, then it says, hold on, Steve, you're supposed to be in pit number one, you're in pit number two.
00:21:54
Speaker
Uh, no problem. Give us a minute. We're going to clear out the system. We're going to, because we know that you've got number two yellow corn, once we get the system cleared out, we're going to change the bends. You know, be patient, sit tight. And, uh, when we get the bends cleared out, we'll let you, uh, proceed and dump in pit number two. Uh, even though you should have been in pit number one. Yeah, that's, that's crazy. Um, yeah, that's far and away above your kind of standard automation.
00:22:24
Speaker
Uh, yeah, it's, uh, it's quite honestly, we started working on this piece of it about two and a half years ago. Yeah. Um, Jim Gales, our construction lead, we were working on the project, the elevator project. And when we got them talking about that, he said, I want to run another idea by you. And he explained this process. And I just, I looked at him not believing it could happen. And he said, well, most of it.
00:22:55
Speaker
is already out there. We just, we got to kind of hook it all together and make it happen. And so I didn't believe him right away. And quite honestly, what we had set up right away was going to be unique to this facility. Okay. And so the only thing I pushed back on is I said, Jim, if we can really do this, we need to make it so it can be scaled so we can take it to the other locations that are running and other CHF locations. Yeah, definitely.
00:23:24
Speaker
Yeah. And I remember him crumpling up the paper and throwing it away because that wasn't going to be scalable. And he came back about a month later and said, all right, let's look at this one. And that's the one we've been working on for the last two and a half years. And, you know, we're, we can see the finish line. Um, so hopefully we get there here in the next 30 days. Yeah. Yeah. Like quite the event, a true lights out facility, which is kind of in the industry goal for what the last 10 years now.
00:23:52
Speaker
or something like that. So that's great. That's encouraging that the automation is kind of leading the industry, but it's keeping up with the industry as well. And in a time when employees are hard to find, this is going to help us create a better work-life balance for our employees. The ag industry is a lot of hours and it's a lot of
00:24:22
Speaker
It's a lot of hours in a hurry. It's weekends and nights and holidays a lot of times when you're dumping grain and loading grain. If you have that drain coming in, you got to go when you got to go, right? We have to load it whenever it comes in. So it gives us, like I say, a little work-life balance. So it should allow us to not always have to have facility staff. And also, this is the other reason we did it. Really, there are three things involved with the decision.
00:24:51
Speaker
work-life balance for our employee. The second one, a better customer experience, because now we're going to be able to extend the hours that we can receive grain without having to have an employee here. So the producer likes it. And the last one is accomplishes our safety goals with, again, we should be able to provide a better work-life balance. And when people aren't fatigued,
00:25:18
Speaker
Things just don't happen like they do when you're petite. So those are the three goals when we started out with this whole thing is how do we make a work-life balance? How do we make it a good customer experience? And how do we do all that and create a better safety environment? Wow. Now that's very impressive. I'm excited to hear more. I am excited for your first test to go well. I'm sure it will. Everybody's chewing their fingernails, but we're getting there.
00:25:48
Speaker
No, that's great. So, switch topics a little bit. How was the town? How was that kind of process? How were they supportive? Did you have a lot of support from the local community to kind of build and expand? Oh, for sure. It's a farm community and we've needed to freshen up our
00:26:14
Speaker
our grain asset in Herman for a while. So this is lots of support and lots of enthusiasm and everybody's excited to use it. It's done everything that we thought it would and more. In fact, I've had publishers that have come in and just have said, wow, I can't believe how fast it is and how much you can do it. They're very impressed and it's worked very well with one year under our belt. Wow. That sounds amazing.
00:26:43
Speaker
All right, and how many types of grain do you guys kind of cut and take in? Because you said you had 18 bins. That's what gives you quite the ability to take in quite a variety, right? Right, 17 bins. But they typically were in corn and bean country. We will also handle wheat. But we primarily handle just corn, wheat and beans, which are located
00:27:13
Speaker
And the bulk, the vast majority of it, we're at 90% of its corn and bean. We've kind of moved out of the wheat belt and into the corn belt in the last several years. And so that's really where we're at. Where are you guys located? I didn't look it up on a map. So we'd be northwest of the Twin Cities, about 170 miles, I should
00:27:40
Speaker
to be sure, but I can do that while we're on the phone, but it's about 170 miles northwest of the Twin Cities. Very cool. I'm from Wisconsin itself, and it's always hard to talk to people. One of our favorite things here is to complain about how bold it is, but you talk to someone in Minnesota and they're like, I'm like, oh, it's like zero degrees here. And they're like, oh, it's fine. It's funny here. Not too bad. Yeah.
00:28:08
Speaker
You learn to live with it, sure. Yeah. But that's great. So I've almost got a question, done a great job explaining everything so far. My last one is what I ask everyone is kind of, what are some of the things that you're most excited about with this new brain elevator? The fact that it's
00:28:35
Speaker
created a better experience for our grower, first and foremost. And that happens through, again, having multiple places for him to dump his drain. So it's already created a better experience for our producer. It's more of an in and out feature versus having to wait in line. So that's first, and we've already accomplished that. And then obviously the second one is this automated feature where we won't have to have anybody on site when the producer falls.
00:29:05
Speaker
I can think of examples. Every year we get that beacon of being from Wisconsin. Every year we get that warmup sometime throughout the winter, where all of a sudden it gets to 35 degrees for no reason at all for three days. If that happens on a weekend, the farmer is just out of luck, right? Because we're closing on a weekend. Here he could have maybe kids are home from college. It's going to be 35 degrees and he wants to haul a bunch of grain. We can do that without having to sacrifice that
00:29:35
Speaker
work-life balance. Yeah, definitely. Well, even during harvest when they're out there harvesting at 10 o'clock at night, the ability to send that grain and not have to wait till the next morning is pretty huge deal. Yeah, exactly. But that's the other thing that we're excited about is being able to supply that or yeah, buy the extended hours without having to burn out our people. Nice.
00:30:05
Speaker
All right, I think that's all the questions I have for you, unless you think I missed anything big. No, I think we hit the help that you sent out or somebody sent out the questions you were going to ask. So I think we covered just about everything that I reviewed in my mind. So I think we're good. Excellent.