Decision Time: Buy The Planes Or Partner With Pilots

Aerial Application PlaneRetailers can meet grower demand for aerial application in a number of ways. Several CropLife 100 companies have chosen to invest in their own planes – in some cases purchasing entire aerial businesses – and to navigate the complexities that come with this service. Other retailers contract with local independent pilots to meet their growers’ needs.

Doing It Yourself

Let’s start with the plane. Some of the latest turbine aircraft with capacities of 500 gallons can cost more than $1 million. Then there are the expenses associated with maintaining the aircraft. Unscheduled engine overhauls, for instance, can cost as much as $300,000 depending on the complexity of the job, says Craig Bair, aerial SSE manager at Wilbur-Ellis Co. And don’t forget the hangar space needed for the plane.

Also consider staffing – you need a qualified pilot and a skilled mechanic nearby, as well as a trained ground crew. Pilots want to take a job with an operator that has a proven track record of being able to keep an aircraft and operator busy, says Bair. If there is not enough work for him in a trade area, a dealer will have to cultivate work elsewhere.

Pilots need to meet the requirements of state and local authorities to be cleared to conduct aerial application from the local airport. Then too, there are state and federal licenses to get in time to do aerial applications and the ongoing training needed to maintain them.

As for mechanical expertise? “There are not many aircraft mechanics familiar with the specialized equipment installed on the modern spray plane,” Bair warns.

Service expenses extend from personnel to a product and fuel delivery infrastructure and operating costs as well. And more funds are needed for liability insurance and safety measures.

One final financial aspect: consider proper depreciation lives for airframes and engines, says Loren Koeman, regional business analyst with Wilbur-Ellis Co. “Tax depreciation often does not match up well with actual lives of components.”

When Contracting Works

In light of the demands of owning and operating planes, most industry members we talked with thought contracting with an aerial business is the best way to provide air application, especially in the Midwest where the time frame for using the pricey equipment is so short.

“In the past we have talked with and done business with retailers that have tried both owning and contracting. In my personal opinion using a local aerial applicator is the best choice,” says Derek Shannon, Townsend Aviation, Monticello, IN. He says these pilots are usually experienced veterans.

Having control of the timing of applications for customers is one of the biggest concerns a retailer might have about contracting, but planning ahead is a great help. Mike Carrell, branch manager with Ceres LLP, Wingate, IN, says at winter meetings with customers, his company will often offer a prepay discount on fungicides. Customers will buy and request an aerial application, then Carrell can go to his aerial applicator to at least offer an initial idea of the number of acres to be serviced – so pilots can schedule accordingly. Tony Goede, aerial manager with BASF, estimates that 70% of the aerial application market is still last-minute, though pilots do have a feel for the volume of work that could hit their area.

Goede says the other biggest worry for retailers when hiring out for aerial work is trust – an issue that also emerged from our reader survey. “For years the ag pilot has simply been summoned in emergencies in Corn Belt geographies,” Goede says. The retailer has had limited contact with him, which decreases the chance to build a trusting relationship. The solution is to find a good ag pilot who takes the time to build relationships and who runs his business honestly.

Return on investment typically is not high with either owned or contracted planes, Koeman admits, but aerial application is definitely one way to differentiate a business from other retailers.

Leave a Reply

Aerial Application Stories

Aerial ApplicationAerial Application Special Report – Sponsored by Air Tractor
September 1, 2012
As the 2012 season winds down in the United States, the trend I’ve seen in previous years continues...more and more growers are choosing aerial application to control diseases and pests. Read More

Trending Articles

Green Valley Ag facility
Retail FacilitiesGreen Valley Ag Adopts A.J. Sackett’s Precision Fertilizer Blending® Technology At New Facility
July 8, 2014
Sackett's Precision Fertilizer Blending® Technology is making huge strides around the world. Green Valley Ag adopts the technology at its new facility to support its advancing agronomic needs. Read More
Retail FacilitiesWaconia Manufacturing Builds Facility Designed For Speed, Efficiency
July 7, 2014
To make its new hub facility more efficient, Cooperative Elevator enlisted the aid of Waconia Manufacturing. Read More
EquipmentSummer Show Preview 2014: Superior Sprayers Take The Field
July 3, 2014
In this final installment of our coverage of the major categories of Big IRON that retailers can expect to test-drive at this summer’s events, here is a look at 19 sprayers. Read More
Scouting a soybean patch at Green Valley Ag.
EmployeesCropLife Compensation Survey: Battling Talent Drain
July 2, 2014
Retailers too often lose employees to companies outside of agriculture, while recruiting efforts are most often limited to competitors and other ag-focused organizations. Read More
HerbicidesDow AgroSciences Introduces SureStart II Herbicide
June 16, 2014
The enhanced formulation has improved viscosity and increased stability under heat and controls more than 60 high-anxiety grasses and broadleaf weeds found in corn fields. Read More
HerbicidesBASF Investing $270 Million To Expand U.S. Herbicide Production
June 11, 2014
BASF has invested more than $270 million to expand herbicide production capacities in the U.S., including more than 20 new products to be launched over next two years. Read More

Latest News

HerbicidesWillowood To Market Glufosinate
July 28, 2014
Willowood USA recently announced that Federal EPA has approved its technical registration for glufosinate. Read More
InsecticidesHow To Scout For Corn Earworms In Corn
July 28, 2014
In her weekly report, University of Missouri Agronomy Specialist Jill Scheidt discusses what to look for when scouting for corn earworm. Read More
Crop InputsDuPont Pioneer, Weyerhaeuser Enter Technology License A…
July 28, 2014
The agreement brings together agricultural and forestry know-how to sustainably improve crop productivity for corn growers around the world. Read More
EquipmentAGCO Launches Global iPad App
July 28, 2014
The free AGCO Global iPad App can be downloaded from the Apple iTunes Store and features the full family of RoGator self-propelled sprayers and TerraGator high-floatation spreaders. Read More
Eric SfiligojYuma Centennial Ag Supply Earns 2014 National Environme…
July 28, 2014
Colorado-based ag retailer receives top trophy in 24th annual DuPont Crop Protection/CropLife ceremony. Read More
CropLife 100Pinnacle Forms Alliance With Wildlife Managment, Seed O…
July 25, 2014
The strategic alliance will provide Tecomate with key wildlife products, processing facilities, distribution centers and sales through Pinnacle’s ever-growing retail network. Read More
ManagementFranken Presses White House On RFS Support
July 25, 2014
Al Franken and a group of Senate democrats recently met with senior White House official John Podesta to urge the administration to change its position on an EPA proposal. Read More
ManagementASA, FarmLink To Launch ‘Operation Benchmark̵…
July 25, 2014
The American Soybean Association (ASA) and FarmLink are teaming up to help farmers close the $11 billion gap between what they harvested in 2013 and what they could harvest annually. Read More
StewardshipNorthey: Farmers Commit $1.4 Million to Try New Water Q…
July 25, 2014
The practices that are eligible for funding include cover crops, no-till or strip till and using a nitrification inhibitor when applying fall fertilizer. Read More
Precision AgFarmers Learn How Changing World Will Impact Iowa
July 24, 2014
Technology and understanding global consumer demand for Iowa farm products brought hundreds of farmers and agribusiness leaders to Ames recently for the annual Iowa Farm Bureau Federation Economic Summit. Read More
HerbicidesPurdue: Late Season Weeds May Require Manual Removal
July 24, 2014
Hand-rouging and pulling late season weeds by hand may be the best way to remove them, more so than using a herbicide, a Purdue Extension weed scientist says. Read More
Soybean Field
InsecticidesTransform WG, Closer SC Insecticides Receive R&D 10…
July 23, 2014
Dow AgroSciences has received the award from R&D Magazine for Transform WG insecticide and Closer SC insecticide with Isoclast active. Read More
EquipmentKinze, Raven Team Up On 4900 Planter Monitor
July 23, 2014
Kinze Manufacturing announces a partnership with Raven Industries to develop a standalone monitor solution for the Kinze 4900 series planter. With this new Read More
LegislationNew Farm Bill Continues To Confuse As Growers Await USD…
July 23, 2014
The new five-year Farm Bill eliminates many of the direct payments previously payed to growers and could benefit from USDA clarification, reports a Toledo Blade columnist. Read More
EquipmentPrecisionAg.com Relaunches With Responsive Design For M…
July 22, 2014
PrecisionAg, the worldwide leader in precision agriculture information and analysis, announces the launch of its completely redesigned website, PrecisionAg.com. Read More
FungicidesEPA OKs Two Willowood Fungicides
July 21, 2014
The EPA has approved Willowood Azoxy 2SC and Willowood AzoxyProp Xtra. two widely used broad spectrum, preventative fungicides with systemic and curative properties. Read More
Precision AgFarmers Learning Fast As UAVs Take Off
July 17, 2014
Farmers and others interested in how UAVs can be used in agricultural applications were able to learn more about the technology during the recent Precision Aerial Ag Show. Read More
CropLife 100Bobby Knight, Richard Petty To Highlight Ag PhD Field D…
July 17, 2014
Attendees at the July 24 Ag PhD Field Day at Hefty Farms will learn about the latest agricultural technologies, and get a chance to meet legendary sports figures Bobby Knight and Richard Petty. Read More