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Contract Issues
Harvest, Baling & Soil Issues
Contract Issues
What if you harvest more tons or fewer tons than the amount contracted from my site?
If more than the contracted amount of stover is harvested from your site, you will be paid for the total amount harvested, not just the amount contracted. If the contracted site does not yield the total tons contracted, we'd need to make arrangements to harvest additional acres. Our contract is a "minimum contract" meaning that shortfalls must be made good.
Will you be buying stover on the open market after the plant begins operations?
No. Our goal is always to secure the tons required to supply the annual needs of a pellet plant. If we don't contract enough stover, we don't build the plant. With the contracts in-hand there's no reason to seek stover on the open market. We avoid open market purchasing because it can quickly destroy the thin margins in pellets.
I see that payment for my stover is received in three installments. Why can't I be paid in full when the stover is harvested?
Stover has to harvested as quickly as possible. But, we don't need all the stover at once. We process the stover throughout the year. The payments represent our use of the stover over time.
At what moisture will the stover be harvested? Is there an adjustment if the stover moisture is too high?
The stover is harvested when it is as close to 15% moisture as possible. The total weight will be adjusted to account for the actual moisture content as determined by testing a representative sample.
Who is responsible for harvesting the stover in the event of a wet fall and winter?
Next Step is responsible for harvesting regardless of weather conditions.
What happens if the stover isn't harvested from the contracted fields?
Next Step will continue to harvest until all contracted acres are baled.
In case of early wet weather is there a final date when I can say "stay out?"
The stover will be harvested no later than April 1 unless the farmer grants permission (in writing) for a later harvest.
I have never baled my stover. I know different corn hybrids yield different amounts of stover. What happens when my stover yield is over/under my contract?
With nearly 5 tons per acre available (on 200 bu corn/acre), Next Step believes there will be sufficient stover on all the fields in this area. The Next Step contract requires that the minimum tons be met and any that any overage will be paid according to the contract's terms.
What happens if I get a big snow storm after harvest but before the stocks are shredded and baled? This will reduce my stover yield. What will I do if I'm short of my contracted amount?
Next Step understands Nebraska weather conditions and plans to harvest during reasonable weather all the way up to the planting season.
Immediately after harvest, who do I contact to let people know they are able to begin the shredding and baling of my stover?
The producer will need to contact Next Step within 24 hours of completing harvest on the contracted site. The Next Step Scheduling Supervisor will then promptly contact with the seller to determine the exact harvest dates.
Seven years is a long time. My farm may change landlords, etc. Can I cancel my contract?
Contracts may only be cancelled for the reasons listed in the contract, which, to ensure the success of Next Step's capital-intensive undertaking, are fairly restrictive. Since the contract is for tons, not acres, farmers have the flexibility to locate alternative acres to supply the contracted stover.
My farm may include a wheat rotation in the coming years. Can I contract wheat straw at a later date? And, at what price?
Next Step does not currently process wheat straw into pellets although this technology is on our radar. Pricing will be determined at that time. For now, you are limited to supplying corn stover.
If I can sell stover on the cash market at a later date at a higher price, why would I lock in seven years with Next Step?
No one knows what the future market for stover will be. But it seems certain that without buyers like Next Step it will remain low. Next Step and other potential stover buyers simply cannot undertake the huge capital risks needed to become viable buyers with out first contracting for a price-predictable supply of stover. It seems equally certain that sellers will have more stover to sell than the amount they have committed to Next Step. So, if prices shoot up, the un-contracted portion can always be sold at the market rate.
When does the stover become the property of Next Step?
The stover becomes the property of Next Step Biofuels when the crew enters the producer's property to harvest the stover.
Will Next Step buy my stover if I show at their front gate? If so, what is the "spot" price?
Next Step has no plans to by "spot market" stover.
Harvest, Baling & Soil Issues
Can I request that less stover be removed; meaning I offer up more acres harvested, but less stover taken per acre.
Unfortunately, no. Next Step plans to leave (2/5th) of the stover for adequate soil protection. The 2/5ths figure is supported by UNL (Univeristy of Nebraska at Lincoln) and other experts.
It is important to me that I control the amount of stover taken off my fields. Can I use my own stock shredder, set it up to windrow, and receive a small premium for that? If I could maintain control of the amount of stover coming off of my field, I would probably contract more acres.
In the future this may be possible, but today it is imperative for Next Step to secure stover under the terms of the contract. As the stover market evolves, so too will our contract.
I am concerned about the bales being harvested when the field is wet and do not want compaction in my field.
We also need suitable field conditions to make quality bales. We will not harvest from overly wet fields. If there is a major concern for compaction, please request the fields to be baled after the ground freezes.
Can I have the bales harvested right away so I can do fall tillage?
Please make your request known, and we will try to accommodate you on a first come, first serve basis.
I'm concerned about bales being taken off my field after the frost has gone out. This can cause compaction. Can you harvest before the frost comes out?
It is our intent to have all bales harvested and removed from the field before the frost comes out. But, please make your request known, and we'll make a best effort to collect bales from fields at risk for compaction before frost comes out.
I'm concerned that removal of bales from my field may cause damage to my ridges. What do you do to protect my ridges?
When removing bales from the field we drive in between the rows and stack bales on headlands for transport. This is the currently accepted best practice where corn stover is baled.
Who is responsible for harvesting the stover in the event of a wet fall and winter?
Next Step is responsible for harvesting regardless of weather conditions.
What happens if the stover isn't harvested from the contracted fields?
Next Step will continue to harvest until all contracted acres are baled.
How does Next Step determine which fields to harvest first?
The harvesting schedule is determined and set by the Scheduling Supervisor.
How is Next Step going to windrow stocks to bale?
Next Step uses state-of-the-art stover harvesting machinery with a two-pass harvest: First the tractor and shredder/flail put the stover into windrows; then a tractor and square baler make a second pass to bale the stover.. As the technology/equipment become available, Next Step's ultimate goal is a one-pass harvest.
Will Next Step haul bales right after baling or do we have to set aside acres to store bales that are hauled later?
Depending on the proximity of the harvest and trucking crews, there may be some need to temporarily store bales. Next Step's goal is always to remove the bales as soon as possible.
In case of early wet weather is there a final date when you can say "stay out?"
The stover will be harvested no later than April 1 unless the farmer grants permission, in writing, for a later harvest.
I have a custom baling business as part of my farm. Can I bale the stover myself and have it waiting at the edge of my field for a premium?
Next Step's pelleting operation requires a very consistent, uniform bale. We use the same harvesting equipment and methods to ensure consistency.
Can I trade my existing brand of baler for the brand of baler of Next Step requires and receive a premium for doing it myself? I really want to control the field traffic in my field.
We are open to this possibility.
What happens if it rains immediately after baling, or before delivery of the stover to Next Step and the bales pick up moisture beyond the 15% limit? Will I be docked on my payment?
You will not be docked for moisture from rain. If we determine that the stover will not be removed shortly after bailing, we'll cover the stover with tarps.
Will Next Step's equipment be set up for ridged acres that have 22" or 30" or 36" rows?
Next Step will facilitate the most common methods of farming. Balers will definitely be set up for 30" and 36" rows.
When are the bales hauled away?
Next Step's goal is to remove the bales once the harvest is completed. Weather, equipment allocation, and other factors may delay the removal of bales for a few days, but the bales will not be left on site for any significant period of time.
Why are you square-baling?
Square bales are more cost effective to transport and the newer equipment is all geared toward square baling. Square baling technology is already in wide use in many parts of the United States; this is a proven methodology for successfully and efficiently harvesting, transporting, and storing stover.
What happens if I get hailed out? Do I still have to deliver stover?
You do not need to identify the fields for harvest until September 1 of the harvest year. If the September 1 date still does not allow you to fulfill your contract – and, Next Step is satisfied that a back-up feedstock is unavailable within 30 miles of our collection site – Next Step, at its sole discretion, may allocate the seller's contracted feedstock commitment to a subsequent year.
It is important to me that I control the amount of stover taken off my fields. Can I use my own stock shredder, set it up to windrow, and receive a small premium for that? If I could maintain control of the amount of stover coming off of my field, I would probably contract more acres.
In the future this may be possible, but today it is imperative for Next Step to secure stover under the terms of the contract. As the stover market evolves, so too will our contract.
How much nutrient loss is there from removing stover?
The exact nutrient value of the stover we remove is difficult to calculate because there are so many variables: the moisture content; tillage practices; etc. We encourage you to contact your agronomist before concluding the contract. But, by removing only 3/5ths of the stover we are following well-established best practices for this region.
What is the fertility/nutrient value of my corn stover?
Nutrient/fertility values vary by plot. Directional values can be found on published charts. Remember, Next Step follows established best practices for your region by harvesting only 3/5ths of the stover in your fields.
What would it cost me today to replenish the corn stover in my corn-on-corn fertilizer program? What would it cost me today to replenish the bean stover in my soybean-corn rotation program?
Stover and stubble nutrient value vary by site, please speak with your Agronomist or Extension Agent. Remember, Next Step follows best practices for your region by harvesting only 3/5ths of the stover in your fields. Remember, Next Step follows best practices for your region by harvesting only 3/5ths of the stover/stubble in your fields.
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