Finance question
Can I finance grain silos for my farm?
Often yes. A bolted or transportable silo that could be removed is usually funded as equipment, while a silo on a poured pad is often funded against the farm property. Live listings run from about $3,500 for an old 55 tonne silo to $31,200 for a new 110 tonne sealed cone base silo, before GST, and every deal is subject to lender assessment.
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The short answer
How the silo is fixed decides who funds it
Lenders look at a silo by asking whether it can be taken away. A transportable or bolted silo that can be removed is movable equipment, so an equipment lender may fund it with the silo as security. A silo on a poured pad is closer to a fixed improvement, so lenders often look at the farm property as the security instead. Appetite is generally good for farms with a trading history and equity, and cautious for new operators, leased land or silos with no resale market.
The price range is wide, and it is worth knowing before you ask for a number. Twelve Farm Tender listings in our grain silo cost guide ask from $3,500 for a late 1970s Kotzur 55 tonne silo to $31,200 for a new 110 tonne gas sealed silo with a 30 degree cone, both before GST. That works out at roughly $64 to $284 per tonne of capacity, silo only. Site works can add as much again as the silo quote, according to GrainKing, so the installed cost is the number a lender needs to see.
An old unsealed silo is hard for a lender to value, which is why a sealed, newer silo with a clear resale market is easier to fund. Equipment lenders value used silos on what they would resell for, which can be less than the price paid. The base, aeration and erection resell poorly, so those costs are usually funded against property or paid from cash. Ventas is a broker across 40+ lenders, not a single bank, and there is no upfront fee to you; the lender pays us on settlement.
Do you qualify?
What a lender looks at on a silo purchase.
Farm cash flow
Financials and BAS that show harvest income can carry the repayments.
Security
Property equity, or silos with a clear resale value if they are movable.
An itemised quote
Silos, base, aeration and erection shown as separate lines.
A storage plan
Capacity matched to your marketing windows and harvest logistics.
Why splitting the funding works
Silo as equipment
Movable silos can sit under an asset loan secured on the silos.
Site works on property
Pads, power and erection suit a loan secured on the farm.
Cash where it helps
Harvest income can cover the part that resells worst.
A worked example
A farm installs three new 110 tonne sealed silos at the Goornong price of $31,200 each, $93,600 in all. With the base and site preparation ($20,000), aeration and power ($12,000), and freight, crane and erection ($13,000), the installed total is $138,600 before GST. Equipment finance covers $75,000 of the silos, a farm loan top-up covers $40,000 of the site works, and $23,600 comes from cash. Illustrative only.
Common questions
Frequently asked questions
Will a lender fund a second-hand silo?
Sometimes. A sealed, newer silo with a known make is easier to value. Old unsealed silos are hard to value, so a lender may want more deposit or may look to your property instead.
Can I include the concrete base and aeration in the loan?
Often only part of it. Site works resell poorly, so lenders usually fund them against farm property rather than the silo, or you pay them from cash. An itemised quote helps the broker split it correctly.
How much do grain silos cost per tonne?
In the listings we reviewed, silo only prices ran from about $64 to $284 per tonne of capacity before GST. Bigger silos usually cost more in total but less per tonne, and site works can add as much again.
Can I claim GST on a silo?
A GST registered business may be able to claim credits on the purchase, and any deduction or write off treatment depends on your circumstances. Ask your accountant before you sign.