The top of every news report and the focus of every bottom line lately has been the economy. While the ag industry has seen its ups and downs, it pays to be in a business that reduces customer effort and labor.
Blender software manufacturers have improved their products every year in an effort to help out their customers — and their businesses. Software companies thrive in tough times because blending facilities — and their customers — are more concerned than ever about accuracy and making sure that every drop of fertilizer is accounted for. “With input cost being so high,” says President David Junge, Junge Control, Inc., “it is even more important than ever to be accurate and accountable.” What the company is doing is working, as it “has grown by at least 25%, and it could increase to 50% by the fiscal year-end.”
While Junge and others may have actually been helped by the economic downturn, blender facilities themselves are turning to the software manufacturers for solutions. “We anticipate a greater need for management software as companies look for tools to help them work more efficiently, improve ROI (return-on-investment), and maintain a competitive edge in the marketplace,” says Judy Warf, marketing communications coordinator, SSI, LLC.
“Our Agvance software can assist them in accomplishing all these goals,” Warf continues. “Through the implementation of the Agvance program with blending and dispatch, retailers are able to work with tighter margins and utilize existing equipment with greater return. In today’s economy this has become more important than ever.”
Making the best use of the people and equipment a facility has now will prevent plants from spending money on personnel or expensive new machinery when they can least afford it. Investing in ag software to help manage these assets is an easy choice. “Junge Control is experiencing tremendous success and are glad to help our clients go from good to great,” Junge says. Its Round the Clock Assistant has contributed to the company’s success and has helped blenders streamline their businesses. Drivers can pull into a plant at any hour, any day of the week; using a touchscreen, the driver can choose a blending option and be ready to fill up. The system cuts down on the amount of staff needed to monitor the facility and input the driver’s choices, letting the plant stay open longer to receive business at any time.
“There is also a push to move larger volumes of product more efficiently to the customer through better utilization of existing equipment and resources,” says Warf. “By implementing a dispatching system, organizations are finding they are able to more efficiently schedule and route applicators and reduce empty miles. This in turn provides them the opportuÂnity to reassess their equipment and man-hour needs and potentially reduce both.”
Why So Serious?
Fertilizer prices soared in many parts of the country last year due partly to higher international demand mostly from China and India. Estelle Grasset, spokesperson for The Fertilizer Institute in Washington, DC, says fertilizer costs have skyrocketed 77%. Prices of nitrogen, phosphorus, and potassium (NPK) have experienced the biggest jumps, but micronutrients such as copper and manganese have been subject to price fluctuations as well. With high input costs cutting into their bottom lines, neither the blenders nor the buyers want to see any of it go to waste.
On the other hand, 2009 doesn’t look as positive. Gulf Petrochemical Industries Co. (GPIC) in Bahrain plans to build a $1 billion fertilizer complex to produce ammonia, urea, and methanol — but it may be the only bright spot on the horizon. Major fertilizer producers such as Canada-based PotashCorp and Agrium have already scaled back production, while German producer K+S plans to reduce potash production through the first half of the year, Norway-based Yara has stopped ammonia, urea, and NPK production in several countries, and U.S. producer Mosaic Co. will reduce phosphate production by 1 million metric tons through fiscal 2009 if the market remains slow.
Between 2008’s through-the-roof prices and 2009’s reduction in production throughout the world, blending facilities must move quickly and manage their businesses carefully so they remain strong in an uncertain economy. Just as the plants need to stay on their toes and adapt to industry changes, so do the software manufacturers that help them streamline their operations. “Since Junge Control focuses on ag inputs, we are very quick to react to our customers’ needs,” says Junge.
What Blenders Want
Products that save the fertilizer plant money while improving customer service will best help those facilities in times of trial. “Today’s economic conditions have created a need for organizations to find ways to improve ROI,” says Warf of SSI, whose Agvance software automates processes to reduce the chance of errors. “One way in which they are able to accomplish this goal is through a reduction of costs by maintaining tighter control on inventories,” she continues. “As organizations increase their number of locations, it is becoming essential to have a software program that allows them access to real-time inventories of each branch location.”
The more control plants have over their operations, the smoother their businesses will run. Not only is inventory control important, but so is the ability to run reports and directly interface with accounting. “They look for speed, accuracy, and accountability in their software, and all are accomplished with Junge Plant Operator Software,” explains Junge. “The ability to import from Agronomy Software and export to Accounting Software is also important, and they achieve this with our Junge Dispatcher Software.”
Now that blender software can accurately measure the blend while saving manpower and expanding the hours that drivers can pick up their orders, the next step is to reduce paper accounting and maintain extensive electronic records. “The next release of Agvance Blending will include an interface to a document imaging system which enables key blend documents to be scanned, stored, and retrieved electronically,” explains Warf. “It is becoming increasingly valuable to store electronic copies of both customer signed tickets and custom application records as most states require these documents be kept on file. With this integration, retailers will be able to greatly reduce the amount of paper they need to keep on hand while gaining the timesaving benefits of instant retrieval of the documents from within Agvance.”
Time will tell what 2009 does for the fertilizer industry, but the future looks positive for those facilities using blending software that can help them tough out the uneven conditions ahead.