The alternative is back in fashion!
At a time when gas prices are soaring, grain silo owners are once again turning their attention to alternative energy sources
Competition between grain elevators is intensifying, and in some regions it is becoming impossible to source enough grain to achieve 3–4 harvest cycles per season. It is not possible to keep reducing the cost of services indefinitely — sooner or later, the threshold of economic viability will be reached, and the price advantage will disappear. Other factors are not as critical for farmers, so we need to look for ways to reduce the cost of production processes.
Grain elevator operators make their biggest profits from grain drying. This is where the greatest amount of resources is consumed, and at the same time, where the maximum profit is generated. As natural gas prices rise, the cost of drying increases to the point where prices have to be raised significantly. This is a necessary move for the operators, but it is by no means popular with customers. They look for lower prices and, consequently, will take their grain to places where the drying cost is significantly lower. There is only one way for silo owners to reduce drying costs — to switch to alternative fuels, as it is completely unclear whether gas will remain cheap in Ukraine.
The company "Greco Group" operates in Ukraine, manufacturing heat generators that run on alternative fuels and possessing extensive experience in retrofitting grain dryers of various capacities. So we spoke to the company’s director, Ivan Korzhenko, who shared many interesting details on how grain elevators can reduce their costs by using wood chips, pellets or grain waste for drying grain.
— Mr Ivan, could you tell us about your company: what does it have to offer Ukrainian farmers, and how will they benefit from working with you?
— We are a Ukrainian manufacturer based in Vinnytsia. We produce equipment for converting grain dryers that run on natural gas to alternative fuels. These can be dryers with a capacity of up to 20 MW — it is within this range that we can ensure the required drying capacity using other types of fuel. Every year, our specialists convert 30–40 facilities.
In addition to manufacturing, installation, warranty and post-warranty servicing, we assist clients with logistics, warehousing and other related matters to achieve a drying cost of between 1 and 4 UAH per 1% moisture content reduction.
— What factors make it possible to achieve such savings?
— Our heat generators operate without a heat exchanger; moreover, ambient air is used as the drying agent, which is mixed with the flue gases emitted during the combustion of solid fuel. Many people will recall the old Soviet-style carburettor cars, which can still be seen on the roads today. When driving behind them, you almost always notice the unpleasant smell of their exhaust fumes. It is a completely different matter with the exhaust from modern cars, which is virtually odourless. Our heat generators are designed so that the smoke produced contains no harmful impurities or soot. At the outlet of the furnace, we have only CO2 and water vapour. As they pass through the grain, these substances leave nothing harmful behind, and even the grain has no smell of smoke.
— Can a farmer simply buy a heat generator and install and commission it themselves?
— The design of our heat generators isn’t particularly complicated. But if you don’t adapt it to the existing dryer, taking into account all the specific features of the plant, nothing will work. It’s like buying an engine from a good car, completely dismantled, with assembly instructions. After putting in a lot of effort and spending an enormous amount of time, you might manage to assemble this engine, but the result isn’t worth the cost. The same applies to installing a heat generator — eventually, it will be installed and will work as it should, but it is hard to even imagine how much time, effort and stress this will take, as well as what the potential losses from incorrect operation or simply the dryer being out of service during the season might be. Therefore, I strongly advise against learning from your own mistakes by installing a heat generator yourself. This requires a great deal of experience, a team of specialists and the appropriate service.
— What do you think is the main advantage of local production?
— In-house production means we don’t have to wait for suppliers for long periods of time. Everything we need can be manufactured in the shortest possible time and dispatched to the customer. It is important to realise that any equipment can break down — even the most expensive and world-renowned. It is therefore vital that the manufacturer does not merely respond to customer requests, but does so promptly, within very tight deadlines.
— What type of fuel can Greco Group heat generators run on?
— We have many facilities in western Ukraine that run on wood chips. However, most use sunflower pellets as well as grain by-products. In this case, the customer decides for themselves which type of fuel to use. In the Vinnytsia region, there are customers who purchase pellets in good time, and for them the cost per tonne-percent is 2.88 UAH. However, there are companies where the cost per tonne-percent reaches 8 UAH, which is too high for our technology. But this can happen if the same maize is dried not to 14–14.5%, but to 12.6–13%. Moreover, they try to remove all the moisture in a single pass. In addition to a significant deterioration in the economics of drying, the process’s productivity also suffers greatly. It should be noted that under such conditions, productivity falls non-linearly, and each subsequent percentage point of moisture takes longer to remove and requires greater energy consumption.
— What difficulties arise when retrofitting dryers?
— We can retrofit virtually any natural gas-fired dryer. As for difficulties, we try to avoid them right from the design and manufacturing stages. We provide a bespoke solution for every client, as no two grain elevators are the same.
We recently had a client who, at an ambient temperature of +5 °C, was unable to raise the drying agent temperature above 80 degrees during the drying process — the gas supply line lacked sufficient capacity. He thought there was nothing that could be done, and the dryer had been operating below full capacity for a long time. However, thanks to our equipment, we achieved the dryer’s full capacity due to the stability of the temperature regime.
— Do foreign manufacturers pose a threat?
— I wouldn’t put it that way. There are European manufacturers who are trying to produce similar equipment, but so far they don’t have any high-capacity heat generator models. We already have examples of dryers converted to 14 and 20 MW, which are operating reliably and delivering excellent economic performance. Other manufacturers haven’t demonstrated anything like this.
— How might retrofitting the dryer affect the grain elevator’s finances?
— A few years ago, all grain elevators in the Vinnytsia region were charging 55–60 UAH per tonne-percent of moisture removal, and competition was fierce. After installing a heat generator, our client set a price of 36 UAH per tonne-percent of moisture removal and saw an increase in both the number of potential customers and their profits.
Competition has intensified significantly, and the Vinnytsia region is now quite saturated with grain storage capacity. I know of grain storage facilities that used to handle 150,000 tonnes a year, but now can barely manage 100,000 tonnes. If the difference in drying costs is 40 UAH per tonne, farmers will most likely try to take their grain to an elevator with cheaper drying, even if it means storing the grain in a damp state temporarily.
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