Concern looms for corn growers (Editorial)
Reports of healthy corn harvests have emerged throughout the Mid-Atlantic.
Good crops coming out of fields is encouraging — that’s the good news.
According to USDA, Virginia’s corn crop is projected to be up 18 percent from last year, and average yield is up 33 bushels per acre from last year’s harvest.
From its Oct. 1 crop survey, the agency forecasted Delaware and Maryland’s average yield increases at 10 and 11 bushels per acre, respectively.
“From all the reports I have gotten so far the corn yields are way up and the prices are to a point where are farmers are going to make some money this year unlike the past few years,” Delaware Agriculture Secretary Michael Scuse told television station WBOC.
Looming on the horizon are anticipated increases in input costs for the 2022 growing year.
According to the Purdue University/CME Group’s monthly Ag Barometer, Concerns about rising input costs rose sharply in September.
Just over one-third of respondents, 34 percent, said they expect farm input prices to rise by more than 12 percent in the upcoming year, which is more than six times the average farm input inflation rate of the last decade.
A month earlier, 21 percent of respondents expected an inflation rate that high; in July it was 12 percent.
The expected squeeze on crop margins, while threatening to a farmer’s profit, doesn’t necessarily erase it.
Farmers will still grow corn because the market wants it and in the Mid-Atlantic, poultry companies as the main end users, want more than the area’s farmers can grow.
It does however, signal a need for farmers to do their due diligence in determining what they can do toward finding their optimal return on investment. That is their task going into any growing year and it is just as important now.
It may mean exploring or expanding use of non-chemical fertilizers like poultry litter or enhanced biosolids.
It may mean cutting back on inputs or investing some of this year’s profits into technology that will help them be more efficient and increase production.
One bright spot in the Purdue/CME survey was a 5-percent increase from a month ago in farmers’ plans for new construction of grain bins and farm buildings.
Whatever route each farmer takes, forming and updating the next year’s crop plan and costs of production is crucial.
That includes meeting with the lender, crop insurance agent, input dealers and other advisors to be aware of strategies and products that, again, find the optimal return on investment.