A Bit of a Head Scratcher...

Sunflower seed is loaded on a barge, while another
barge sails up river on the Danube.

FRIDAY, MARCH 23, 2012: We start the day traveling to a port down the Danube River—the "Mississippi River of Europe." This large storage facility has 84 buildings with a capacity of 256,000 bushels each. There are also drying and cleaning facilities on site. Even though the port is right on the Danube, only about 20% of the grain is shipped by barge. The remainder moves by truck or rail.

This facility was originally built to handle "interventional" grain—stocks of corn, sunflowers and rapeseed that would be parceled our (or stored) in response to market conditions as a way to control prices—similar to the warehouse reserve program in the U.S. The Hungarian program no longer exists, so the facility is now privately managed.

An employee watches as sunflower seed
is dumped at the barge facility.

The members of our group were struck by the inefficiency of moving grain by truck from the warehouses to the barge loading facility. The manager providing the tour said they intended to eventually build a conveying system that would move the grain from storage to loading. While we were on site, they were loading a barge with sunflower seed.

We hopped on the bus and headed to the farm owned and managed by Ferenc Miko, the farmer we learned of yesterday at the Dekalb/Monsanto facility. Ferenc won his nation's corn yield contest last year with 302 bushels per acre on non-irrigated land (and with no GMO hybrids). He made it a point to let us all know that only seven winners in the NCGA corn yield contest beat his 302-bushel achievement.

Ferenc Miko discusses his
impressive farm operation.

A former top-class chef, Ferenc got into farming in 1996 with 60 hectares and has built an impressive operation in a very short time—about 8,000 hectares. He grows corn, wheat, barley and sunflowers. Ferenc started building grain storage in 2000 and has added capacity annually. He has an on-farm quality grading facility. Ferenc claims to have a 259 bushel/acre average yield on corn in 2010—and 270 bu/acre in 2011—with a planting population of 30,000 per acre.

He made sure that every farmer in our group shared his average yields—clearly with the intent to further underscore the fact that his record yield was better than that of some America's best farmers.

He has quite a gig going here. He uses subcontractors to farm the land—and he essentially serves as a kind of "cooperative" for other farmers in the area. He buys inputs in bulk and resells them at a competitive price to his neighbors. He sells and markets grain—and even gets Cargill to pay him to store grain! (Corn prices are based on both CBOT and Budapest.)

Members of the team tour Ferenc
Miko's on-farm grain storage facility.

The facility was a bit overwhelming. Six combines. A fleet of huge grain carts. Tractors. Grain storage of enormous capacity. You name it. Ferenc had it. And he also had everyone in our group trying to figure out how someone could do this much in just 15 years. Apparently some government subsidies were involved, but mostly it appears that Ferenc has been able to capitalize on a seismic shift in Hungarian agriculture.

Deb Keller of Iowa inspects
sunflower seed in Ferenc Miko's
grain storage facility.

It's a long story, but essentially the old cooperative farms were returned to their original owners (or their heirs) in the 1990s as part of a "restitution" program. When that happened, many people who had no idea how to farm ended up being owners of farmland. Production fell—and a drought made the problem even worse. As a result, new "cooperatives" were formed that consolidated parcels of land under central management—and now Hungarian agriculture is on the rise again.

Our group pressed Ferenc on his cost of production, his fertility program and other issues, but he was reluctant to share details (as are most winners of national yield contests!) He believes that Hungarian farmers will become a force to reckon with—especially as non-GMO drought resistant hybrids and other management practices become available to him.

Ferenc and his wife were gracious hosts, providing us with a delicious lunch of pheasant soup and wild boar—made of game he hunted and shot himself. We left the farm scratching our heads a bit as to how the apparent achievements were possible—but also with the feeling that Ferenc was a smart operator and a bit of a visionary and "thought leader" in his part of the world.