The season average price for corn, projected in USDAs most recent supply and demand estimates, is $3.20, well below the $3.70 reference price that triggers PLC payments. Other than 160 acres purchased this year, he aquired this land 10+ years ago at an average land cost under $2,000/acre. Even with those, the net return on beans is projected at a negative $15 an acre. It doesn't appear that farmland prices are slowing down anytime soon either with the steady increase in prices as seen in the graph above. Corn: 13 cents per bushel in charge; then 4 cents per month prorated daily through August 31, 2023. Iowa has led the Nation in corn production for the last 27 consecutive years and 42 of the last 43 years. In 2023, total costs are projected at $1,161 per acre, up from the $1,054 level in. The break-even soybean price is $12.54. Inventory value gain or loss - change in value of crops or livestock sold due to differences in opening inventory price and final sale price. The 2023 crop budgets are based on projected input cost levels, trendline corn and soybean yields and per-bushel prices of $5.30 for corn and $12.75 for soybeans. The Estimated Costs of Crop Production use average corn seed prices paid by farmers in Fall 2020 around the state in both corn budgets, so our budgets do not disaggregate seed traits. Operator landowners on fully paid land will have much lower accounting costs, since the cash rent used in the report will only be an opportunity cost and not a cash cost (as it is for tenants). The Illinois Central CRD has a 210.4 bushel per acre average corn yield, a 64.0 bushel per acre soybean yield, and a 3.29 corn-to-soybean yield ratio (3.29 = 210.4 corn yield / 64.0 soybean yield). However, futures prices are currently reflecting a market reaction to unexpected USDA production and stocks figures, and they could retrench fast once the market reassess the real impact of the new information. ", 2023 Crop Budgets: Higher Costs and Lower Returns, Revenue and Costs for Illinois Grain Crops, Revenue and Costs for Illinois Grain Crops, Actual for 2015 through 2021, Projected 2022, Nitrogen Fertilizer Outlook for 2023 Decisions, Corn and Soybean Prevent Plant and the Dakotas, Department of Agricultural and Consumer Economics, Department of Agricultural, Environmental and Development Economics. Johnson expects federal payments to come from two main sources, the farm bill programs of ARC (Agriculture Risk Coverage) and PLC (Price Loss Coverage) and from extraordinary payments meant to cushion losses from the economic effects of the coronavirus. In the latest projections used for the 2021 report, corn yields are 2 bushels higher than for 2020, while soybean yields remained unchanged. To maximize profit, research shows Minnesota growers need a final stand of 32,000 to 34,000 plants per acre (Figure 1), although this varies with the cost of seed and corn price. An average corn fertilizer program in Southern Minnesota is expected to cost about $250 to $300 per acre in 2022, as compared to an estimated $140 per acre in 2021 and $121 per acre in 2020, based on South Central College (SCC) Farm Business Management (FBM) data. Sign-up for either ARC or PLC for 2020 is still underway until June 30 but most farmers have already opted for PLC for corn base acres and likely ARC-CO on soybeans. <> 260 Heady Hall corn and 59 bu. Values of $187, $222, and $256 per acre rent charges for the low, medium, and high quality land were assumed. Information is provided 'as is' and solely for informational purposes, not for trading purposes or advice. Obviously, risks of lower returns exist. I do believe there will be some interest in lowering that fixed rent, Johnson said. Non-land costs are projected to be $860 in 2023, up from $758 in 2022. Farmer returns are projected to be lower for 2023, as is illustrated in Figure 2, which shows farmer returns for central Illinois farmland with high productivity farmland. Dec 9, 2014. The annual rate of corn yield improvement more than doubled to about 1.9 bushels per acre per year and has continued at that steady rate ever since, sustained primarily by continued improvements in genetics and crop production technologies (Fig. x=8z98[; @&bg6;bfV_de{HEv:r'@;EbIXoo.(~? How can I make money with 10 acres? Have a specific question for one of our subject experts? A central Illinois corn farmer will make a $24 per acre profit in 2022 after paying for inputs and land costs, according to the latest crop budgets from the University of Illinois. How many farmers know what their inputs are, let alone their costs per acre or per bushel? Total costs are projected at $785 per acre, with $476 per acre in non-land costs and $309 per acre in cash rent. Use the 68-95-99.7 Rule (Empirical Rule) to answer the following questions. Nearly 30,000 kernels of corn are planted per planted acre, and corn yields can be close to 200 bushels per acre in a good year on high CSR land. Will Bird Flu Become a Recurring Issue Each Year. Units Nitrogen, $0.83 per pound 167 138.61 177 146.91 187 155.21 Phosphate, $0.75 per pound 63 47.25 69 51.75 77 57.75 Second, farmers paying land rents higher than the ones projected in the report might face higher costs of production. More details on 2023 budgets are available in the management section of farmdoc through two documents: Schnitkey, G. and K. Swanson. Non-land costs for 2019 are projected at $369 per acre, an increase of $15 per acre over 2018 costs. Bonsai plants. Offer indoor or outdoor storage. It will be on corn for the 2020 crop but not received until October 2021.. It is hard to trim costs so you can make a better profit if you dont know your inputs. Total costs of corn and soybean production per acre are expected to increase, respectively, by 2.1% 3.4% and 2.6% in 2021. An increase in overhead cost per acre was made in the 2021 budgets, going from $20 to $25 per acre. Member. And Mexico is huge! Net returns to corn following soybeans would range from $55 to $74 per acre under conventional tillage, and average $82 and $75, respectively, under strip tillage and no-till. However, it is great that you are reviewing the budget line by line and adjusting our state average estimates to reflect the specifics of your operation. The most recent USDA projections for 2021/22, published in October 2020, put the average US farm prices for corn and soybeans at $3.65 and $10.00. For northern Illinois, the break-even corn price is $5.34 per bushel on cash rented land. The tables are calculated on a per acre basis. Take, for example, the Central CRD in Illinois. The average cost per bushel has been between $1.25 and $1.95 in the cash corn division and $1.13 and $1.81 in the livestock corn division. In recent years, corn profits have been significantly more volatile than years past. In this scenario, soybean production would only be profitable for operations with medium and high yields, but the profitability margins could be very tight (Figure 3). According to some studies, average yield of garlic per acre is between 10,000 and 12,000 pounds and yearly profit per acre is around $80,000 what makes this crop one of the best cash crops with the highest profit per acre. For 2021, Purdue's Crop Cost and Return Guide suggests and expected corn yield of 180 bushels per acre for rotation corn on average quality farmland. where did the 198,870 kWh per acre in Iowa come from? We use a great deal of rope for odd jobs around the farm and at various community events. All rights reserved. At projected cost levels, per bushel prices of $5.30 for corn and $12.75 for soybeans result in marginal profitability, similar to levels experienced from 2014 to 2019. Gross income = $950 / acre 4. Yields are set at trend levels for 2023, with trends established through historical yields. Those break-even price are above average prices received from 2014 to 2019: $3.66 per bushel for corn and $9.69 for soybeans. Post Application Coverage Endorsement Tool (Sheet), Balance Sheet & Historical Financial Statements, Briomass Crop Budget Tool Miscanthus & Switchgrass, Illinois Soil Productivity & Yield Utilities, Farmland LEasing Facts Sheets & Pricing Information, Schnitkey, G., K. Swanson, C. Zulauf and J. Baltz. In northern Illinois, for example, corn is projected to have a -$11 per acre return, while soybeans are projected to have an $11 return, a difference of $22 per acre. Having considered all variables, experts have come to the conclusion that farms averaged $673 total revenue per acre and averaged $664 total cost per acre. %%EOF Corn costs were much smoother than prices. 1 0 obj The average of all farms in each table represents a weighted average of the values for each size group listed. Several notes concerning the budgets shown in Table 1 are: Farmer returns represent the amount remaining for the farmer after paying all financial costs, with a land charge at the average projected cash rent. Return on assets - net farm income, plus interest expense, minus value of operator and family labor, divided by total farm assets owned. Ways to Make Money Off Your Land Almost Immediately Rent plots to groups looking to build a community garden. Projected returns range from $13.50 per acre for dryland corn to $194.55 per acre for irrigated corn. The Ukraine-Russia war has further clouded the outlook and worsened supply chain issues. ~ Providing Timely, Accurate and Useful Statistics in Service to U.S. Agriculture ~, County and District Geographic Boundaries, Crop Condition and Soil Moisture Analytics, Agricultural Statistics Board Corrections, Still time to respond to the 2022 Census of Agriculture, USDA to follow up with producers who have not yet responded, Still time to respond to the 2022 Puerto Rico Census of Agriculture, USDA to follow-up with producers who have not yet responded (Puerto Rico - English), 2022 Census of Agriculture due next week Feb. 6, Corn and soybean production down in 2022, USDA reports At the landowner webinar, Kristine Tidgren, director of ISUs Center for Agricultural Law and Taxation, covered the highlights of the nearly $700 billion program. The most profitable farm made $275 per acre while the least profitable lost $222 per acre from planted corn. During the prolonged and excessive rainfall that fell on a good portion of the U.S. in 2018, the Southeast, portions of Iowa, and the Upper Midwest had more than 60 inches of rainfall, resulting in increased abandonment rates and many unharvested acres of corn. Those differences are not likely to change normal rotational decisions. Required fields are marked *. The break-even soybean price is $12.54. With the many types of flex rents, the landowner usually takes a lower fixed payment than with cash rents, in exchange for sharing a percentage of the farms positive returns. Soybeans could trigger a $10-per-acre PLC or ARC-CO payment and CFAP would bring another $12 an acre. Gross revenue (market revenue plus government payments), variable cost, and overhead cost per acre for rotation corn on average productivity soil is illustrated in Figure 2. If you're making 1000/acre +, you need to keep very quiet about it, otherwise peeps will jump on the bandwagon and wreck the job for everyone, as has happened with organic veg/free range chickens etc.