By Joe Janzen
Grain storage infrastructure including bins, elevators, bunkers, and sheds, allows farmers, grain merchants, and others to take advantage of price differences across time, storing grain when it is relatively cheap and bringing it to market when it is more valuable. Storage also facilitates grain aggregation and movement to end-users. Thus, storage infrastructure is critical to the effective operation of US grain supply chains and the efficiency of US grain markets. Robust grain storage infrastructure allows farmers to receive the highest possible price for their crops, conditional on demand.
The US generally has sufficient grain storage infrastructure, but there are concerning changes in recent storage capacity data. For about twenty years, from 2000 to 2019, grain storage capacity grew in lock step with increases in US grain production. This parallel growth implied capacity was ‘right sized’ for existing grain supply chains. Since 2020, capacity growth has disappeared. While crop production continues to rise, storage capacity both on farm and off farm has remained roughly constant. This change holds across all major grain growing regions.
Less storage capacity relative to crop production is concerning if it creates bottlenecks in the grain handling and transportation system that raise costs and generate significant differences in price between producer and end-user. In transportation for example, shipping constraints on the Mississippi River waterway due to low water levels have periodically led to large swings in inland crop prices relative to prices at export terminals (Flores and Janzen, 2023). This year’s large US corn crop has led to record high US storage capacity utilization, particularly in on-farm storage. Recently released data showed 80% of on-farm storage capacity was used by major crops as of December 1, 2025. Stagnant capacity growth raises at least two unanswered questions for the US grain industry from the farmer forward through the supply chain: i) how much capacity utilization is too much before capacity constraints disrupt supply chains and affect market prices? and ii) who will invest in new storage capacity if increases in crop production are expected to continue?
Capacity Growth Stopped
An earlier farmdoc daily article (Janzen and Swearingen, 2020) described changes in US grain storage capacity over time. It showed US grain storage capacity as reported by USDA’s National Agricultural Statistics Service grew by an average of 349 million bushels per year between 2000 and 2019 as shown in Figure 1. This growth followed a period of rationalization in the 1990s where storage capacity shrank. By 2019, total US grain storage capacity was just over 25 billion bushels. US grain production growth was remarkably similar to storage capacity growth over this earlier period. Total production of crops that can plausibly use grain storage infrastructure (whose inventories are estimated in the USDA NASS Quarterly Grain Stocks report, namely barley, canola, chickpeas, corn, flaxseed, lentils, mustard, oats, peas, rye, safflower, sorghum, soybeans, sunflower and wheat) was typically 2.5-5 billion bushels less than total storage capacity. Average annual production growth was about 340 million bushels per year, remarkably similar to storage capacity growth as indicated by the parallel linear trends in Figure 1.
After 2019, these parallel trends have diverged. Grain storage capacity growth has been negligible, increasing only 337 million bushels in six years, or less than what occurred in an average year previously. Had capacity growth continued its linear trend shown in Figure 1, the US would now have 27.5 billion bushels of grain storage capacity. One might argue that the end of growth was a prescient response to a slowdown in production growth as national grain production was below trend every year between 2019 and 2024. However, the 2025 US crop was large, mainly on the strength of record corn yields and historically elevated corn acreage (Franken and Janzen, 2025) and crop production is closer to total capacity this year than any since 1988. Surplus aggregate storage capacity (capacity in excess of production) was just 5% in 2025, well below the average level of 15% observed since 2000.
Source : illinois.edu