Economics troublesome for major 2016 crops

Ray Mueller
Now Media Group


Growers of corn and soybeans will most likely be struggling to earn a net return on their production this year, Outagamie County Extension Service crops, soils, and horticulture agent Kevin Jarek reminded attendees at the farm management update for agricultural professionals on May 6.

Based on a 150 bushel per acre corn yield with a cash selling price of $3.50 per bushel, Jarek calculated a net loss of $20 per acre if the costs included the county's average land rent rate of $128 per acre. He noted that the projected bottom line number would change based on yields and prices.

Jarek spoke at the end of a week during which farmers in the eastern and central part of the state made huge advances in their planting of corn. He cited reports that indicated some corn had already emerged in the far southern parts of the state by May 1.

For soybeans, Jarek calculated a potential net return of $36 per acre from a 40 bushel per acre yield and a selling price of $9.50 per bushel. Most soybeans were likely to be planted this week and next week in the east central counties where the growing degree days this spring have lagged those in other areas, he pointed out.

Winter wheat outlook

With winter wheat, profits from the 2016 crop are most likely to be obtained if the grower is able to earn an extra $80 per acre by selling the straw, Jarek observed. On an average yield of 90 bushels per acre at a selling price of $4 per bushel, a net return of $60 per acre could be realized when including the straw sales.

Jarek put the production costs for winter wheat at $380 per acre. That would include the cost of herbicide and fungicide applications, both of which he recommends. At the start of May, 84 percent of the winter wheat in Wisconsin was rated as being either in excellent or good condition, he noted.

Alfalfa outlook

Compared to a year ago, prices for all quality grades of alfalfa hay are down by as much as $60 to $90 per ton, Jarek reported. With alfalfa stands, especially those seeded in 2015, coming through the winter in relatively good condition and with very adequate soil moisture for growing the first cutting, there doesn't appear to be much of an upside for alfalfa hay prices, he indicated.

Prospects for a net return on alfalfa depend on a number of variables, including having a season's total yield of at least four dry matter tons per acre and an average selling price of more than $120 per ton, Jarek suggested. He also asked growers to factor in the costs of top-dress fertilizer and for stand establishment on fields from which much smaller yields will be realized this year.

To price standing alfalfa, Jarek referred buyers and sellers to the smartphone app developed in 2015 by Waupaca County agriculture agent Greg Blonde. With more than 1,000 users so far, this free app can be downloaded on Android smartphones and tablets through the Google Play store (search for Hay Pricing).

Jarek announced that the Predictive Equivalent of Alfalfa Quality (PEAQ) calculations and reports would begin this week. He will also be involved this summer with Extension Service plots of low lignin alfalfa and with a project to compare the establishment success and economics of coated and non-coated alfalfa seed.

Check Extension Service charts in order to calculate crop nutrient credits from manure applications, Jarek advised. He has also noticed that some farmers have apparently not obtained the Implements of Husbandry permits that they're supposed to have for operating their equipment on roadways.