April 27, 2017
The Cottonseed Conundrum
With news that Congress continues seeking a way to fold cotton back into the ARC and PLC program, this article looks specifically at the cottonseed issue. It builds on the review of the operation of generic base acres and concerns that generic base acres effectively recouple Federal payments to production decisions.
April 25, 2017
Acre Changes in Crops from 1991 to 2016
Over the past 25 years, there have been shifts in crops planted in the United States. Overall, acres in feed grain crops decreased while acres in oilseed crops increased. Feed grain crops losing acres were wheat, oats, barley, and sorghum. The only feed grain crop with a large acre increase was corn. Within oilseed crops, soybeans accounted for 90% of the acres in the category. Over time, U.S. Farmers have tended to specialize production in corn and soybeans in the United States.
April 24, 2017
Weekly Outlook: Current Corn Market Price Factors for 2017
July corn futures price closed, over the past week, at the low end of the price range between $3.60- $3.80 that it has moved around in since early March. Lower corn prices appear to reflect mixed expectations regarding demand factors and the potential for large supplies coming out of South America. In the near term, corn prices look to remain range bound as old crop inventories move into the market. Looking forward to the new crop season, the potential for strengthening corn prices is present due to the possibility of a decline in stocks associated with lower corn acreage in 2017.
April 21, 2017
Cost to Produce Corn and Soybeans in Illinois -- 2016
In 2016, the total of all economic costs per acre for growing corn in Illinois averaged $886 in the northern section, $870 in the central section for farmland with "high" soil ratings, $849 in the central section for farmland with "low" soil ratings, and $801 in the southern section. Soybean costs per acre were $638, $652, $610 and $603, respectively. Costs were lower in southern Illinois primarily because of lower land costs. The total of all economic costs per bushel in the different sections of the state ranged from $3.81 to $4.92 for corn and from $9.44 to $10.77 for soybeans. Variations in this cost were related to weather, yields, and land quality.
April 20, 2017
Have Generic Acres Impacted Planting Decisions?
As discussed in the April 13, 2017 farmdoc daily article, the 2014 Farm Bill created generic base acres which allow the current year crop plantings to determine which commodity program payments a producer might be eligible to receive. Thus, the introduction of generic acres in the 2014 Farm Bill allows for the possibility of recoupling, a situation in which farmers consider expected program payments when making planting decisions. Peanut payments and plantings are evaluated below because 1) low peanut prices have led to expectations for large program payments since the 2014 Farm Bill programs took effect, and 2) peanuts are planted in areas where many generic acres exist.