October 16, 2005

Pioneer Hi-Bred Demystifies Steady Business of Seed Corn Processing

By Matthew Wilde, Waterloo-Cedar Falls Courier, Iowa

Oct. 16--TOLEDO -- Pioneer Hi-Bred International's roots run deep.

After 50 years, the company is firmly planted in Toledo. Pioneer's seed corn processing plant provides stable income to area farmers growing corn for the company, jobs for more than 900 workers -- both full-time and seasonal -- and cash and volunteers to local schools.

That's what people know.

But what happens inside the buildings, connected by miles and miles of conveyer belts, on the massive 40-acre complex at the corner of U.S. Highways 63 and 30 is still a mystery to most. They see semi loads of ear corn come in and bags of seed go out.

"The public doesn't understand. I've had so many comments like: 'Now that harvest is done you must sit around and play cards the rest of the year,'" said Greg Tingley, plant manager.

Hardly. While the workload for Northeast Iowa grain farmers tends to slow in the late fall until early spring, that's the busiest time of the year at the plant. Producing enough seed for customers is a year-long process.

As the Toledo facility celebrates its golden anniversary, plant officials and community members reflect on what the plant does, its importance to the town and its future.

Seed corn production

With a market share of just under 40 percent, Pioneer is the largest seed corn supplier in the world. The Des Moines-based company sells a little less than 16 million bags a year, of which 800,000 are produced in Toledo.

Years of research go into making hybrid -- taking the best traits from different varieties and combining them to improve plant production and health -- corn. Pioneer's 22 corn processing facilities in North America are charged with making it happen.

This year the Toledo plant contracted 44 growers to raise 6,500 acres of seed corn. Of the nearly 300 hybrids offered by the company, the Toledo facility handles 17. The hybrids are also contain various combinations of fungicide and insecticide seed treatments.

Fifty years ago there were probably a handful of hybrids to worry about, Tingley said. Now, genetically modified seed, along with hybrids to resist drought or thrive in wet conditions, just to name a few, are offered.

"It's pretty intense to think through this and keep everything straight," said Tingley, who's managed the facility for 10 years.

"Organization is important."

That means harvesting seed and processing it according to demand from dealers. Toledo's harvest ended late last month, but the bulk of the work is just beginning.

Unlike commercial corn, seed corn is picked, not combined. Keeping the husks on protects the corn. It's also harvested early to prevent any chance of frost, which could impede germination the next year. That means the seed corn comes out at 38 percent moisture, about twice as wet as commodity grain farmers like.

The corn is shipped to the Toledo plant via semi. Specific information such as grower name, batch and hybrid are entered into a computer database.

Hybrids are harvested individually to prevent commingling. Husks are removed and the ears are sorted by hand for quality. Rejected ears, such as those off color or containing a little mold, are chopped up with the husks to be sold for livestock feed.

Corn is then moved via conveyer to four giant, cement dryers with a 100,000-bushel capacity. corn is dried on the ear for three to four days to 12.5 percent moisture, unlike farmers who dry shelled corn and not as low. Again, research showed this preserves kernel quality and limits losses. That's also why conveyers are used instead of corn-crunching augers.

Dried corn is then shelled and moved into bulk storage to await processing. The cobs and fines -- left over material from the shelling process -- are also sold as livestock feed.

"Nothing is wasted here," Tingley said.

Seed is then separated according to size and weight. Some planters require uniform seed size to ensure proper plant populations. Before 80,000 kernels are automatically bagged, they're treated with a variety of combinations of fungicides and insecticides.

A bag equals a bushel of corn and covers about 2.75 acres. Currently cash corn is only worth about $1.50 per bushel at local elevators, but seed companies charge between $50 to $200 per bag.

Pioneer officials defend the disparity by noting it takes up to 10 years of research, costing millions of dollars to get a new hybrid from conception to planter. Not to mention the cost of operating the global company and processing plants with the latest technology.

"With all the different treatments and genetics ... that's what farmers are demanding," Tingley said.

After bagging, seed is then put on pallets and stored in warehouses with space for 725,000 units. It will then be shipped to dealers as needed.

"We'll be busy with conditioning and bagging until mid-March. Anything not bagged by April 1 is pushing the envelope," Tingley said.

Toledo -- population 2,500 -- isn't exactly a bustling metropolis with factories waiting to relocate there. That's why Mayor Bill Christensen is thankful one of its larger employers is committed to the area and is a model corporate citizen.

"It's one of the greatest things we have in the town. They have a good work force who participates in community activities," Christensen said.

Just the way the company presents itself, by always keeping their property neatly manicured, could help lure new residents and businesses to town, the mayor said. Businesses like to relocate to communities with pride.

"Pioneer looks so great, everyone else feels they should as well," Christensen said.

Besides the obvious perks of making up a good chunk of the town's tax base and paychecks being spent in the community, Pioneer hires hundreds of seasonal workers and detasselers who earn a little extra money each year.

"That's a big shot in the arm to our economy. In a town our size, there's no way all these kids and teachers (could earn extra money)," said Greg Darling, principal at South Tama Community Middle School. "I know it (detasseling money) helped my son."

Probably even more important, Darling said, is Pioneer's involvement at his school. The company donates money to fund the school's annual Academic Awards Night, buying medals and prizes. It funds an award for attendance.

Workers volunteer to help with various school activities and give plant tours to students. Sometimes its easier to understand agriculture by experiencing it first hand.

"It's been real beneficial to us and the community. As an ex-educator, I know that's (volunteerism) real important," said Craig Fish, plant agronomist and former biology teacher in Parkersburg.

Successful businesses know they must evolve and embrace technology to survive. In Toledo, Pioneer has done just that.

Gone are the days of manually sewing each bag of seed shut and moving them by hand. Automatic baggers, stackers and palletizers allow more seed to be processed more quickly.

As proof the company is here to stay, Pioneer continues to stick hundreds of thousands of dollars into the plant to improve efficiency. A 40,000-square-foot warehouse expansion was completed a few months ago to relieve cramped quarters.

A computerized warehouse management system was also installed.

Previously, keeping track of hundreds of thousands of bags of different types of seed was done with pencil and paper and hand-drawn warehouse maps.

"That was time consuming. If you had to search for (a few) bags, they all start to look the same when it comes to April," said Kevin Nelson, production technician.

Now, each pallet of seed is assigned a bar code once it leaves the line designated by product. Warehouses are broken down into designated rows and areas, each with a bar code plaque as well.

Forklifts are equipped with computers and bar-code scanners. Pallets are scanned coming off the line then placed in a storage area that is scanned as well. The data is entered into the computer so when a particular product is needed, its exact location and quantity is readily available.

In an effort to save energy and money, the Toledo facility joined forces with Iowa State University and Carbon Energy Technology to perfect a gasifier. The idea is to power the plant's corn dryers with discarded corn instead of natural gas.

The Toledo plant alone uses enough natural gas to heat 8,000 homes annually.

"It's quite an accomplishment to be in business for 50 years, and we look forward to continuing our operations there for many years to come," said Terry Garner, Pioneer production manager.


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