The most profitable farm made $275 per acre while the least profitable lost $222 per acre from planted corn. At 180 bushels per acre it is $3.58 per bushel. And in some years, growing corn may not be the best option. In 2023, farmer returns are projected at $25 per acre, well below levels for 2020 to 2022, when farmer returns averaged $232 per acre. If you thinking of going into the corn farming business and are worried about what your income would look like, or you are just plain curious, we would try to provide an estimate of the profit that can be had per acre of farmed corn. 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. Those break-even price are above average prices received from 2014 to 2019: $3.66 per bushel for corn and $9.69 for soybeans. endstream endobj startxref Such methodological adjustment resulted in an average 6% increase in the amount of nitrogen applied to corn following corn, and an 11% increase in the amount applied to corn following soybeans. Over time, corn yields have increased an average of 2.0 bushels per acre, while soybean yields have increased by .5 bushels per acre. For all regions of Illinois, the relatively high returns experienced in recent years are projected to end in 2023. At a Farmland Owners Update webinar, Johnson said he estimates that Iowa farmers, on average, will receive about $95 an acre in federal payments for the 2020 corn crop. 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. Projections are for a return to much lower profits in 2023, continuing a pattern of rising and falling farm incomes. It is difficult to predict corn-production economics. Working capital - current assets minus current liabilities. As of Friday, $130 billion hadnt been spent, Tidgren said. The most recent release, September 2019, showed county-level rental rates for non-irrigated cropland ranging from less than $10 per acre in several Western states to more than $250 per acre across portions of the Corn Belt in Illinois and Iowa. Weighting factors are based on the number of farms in each size group in the state, as computed from the most recent Census of Agriculture. The average yield on an acre of popcorn ranges from 1,000 to 4,000 pounds of grain. Overall, with all adjustments considered, cash and economic costs per production unit remained generally steady from the 2020 budgets to the new budgets for 2021. Gourmet mushrooms. These variations impact US state corn production.. Each is important for creating an accurate corn yield forecast. Lavender farming can produce above-average profits for small growers, as it is such a versatile crop. Last Tuesday, the Food and Agricultural Policy Research Institute released an estimate of a record $32.8 billion in direct payments that will go to farmers this year. 14 percent or 2.065 billion bushels of Iowa corn was exported out of the state in the 2018/19 marketing year. A bit of luck here. Corn and soybeans futures prices have recently rallied to their highest levels in years, providing hope for a market-driven profitable 2021 crop year. Current futures prices seem to indicate that corn and soybean prices might average $4.45 and $11.40 per bushel in 2021/22, respectively. Corn seed costs are expected to increase by 2% to $262 per bag. Those differences are not likely to change normal rotational decisions. 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. 260 Heady Hall 0 Even with those, the net return on beans is projected at a negative $15 an acre. No other revenues are projected, giving a gross revenue projection of $567 per acre. For corn, he used an estimated yield of 198 bushels and a price of $3.20 per bushel. For soybeans, the yield is pegged at 55 bushels an acre with an average selling price of $8.20 per bushel. The lowest returns are projected for southern Illinois, with farmer returns of -$63 per acre for corn and -$61 per acre for soybean. At the landowner webinar, Kristine Tidgren, director of ISUs Center for Agricultural Law and Taxation, covered the highlights of the nearly $700 billion program. endobj In the cash corn division, the average cost per bushel has ranged from $1.25 to $1.95, and in the livestock corn division, the average cost per bushel has ranged from $1.13 to $1.81. While fertilizer prices have declined recently (see farmdoc daily, July 19, 2022), fertilizer prices are still much higher than last year. John Deere Updates 7, 8 and 9 Series Tractors For Model Year 2024, AgDay TV Markets Now: Randy Martinson Talks About How the February Crop Insurance Prices May Impact Planting Decisions. With an expected harvest price of $3.65, the anticipated market revenue is $657 per acre. Schnitkey, G. and K. Swanson. Return on assets - net farm income, plus interest expense, minus value of operator and family labor, divided by total farm assets owned. However, higher expected corn yields over a 30-year trend for 2021 suggest that on a per bushel basis, costs would increase by 1.0% 2.6% to remain below their 2019 marks (Figure 1). The average corn yield in the United States was estimated at a record 177 bushels per acre, 5.6 bushels above the 2020 yield of 171.4. Area harvested for grain is estimated Corn for silage production is estimated at 5.33 million tons, down 33% from 2019. Special Tabulations and Restricted Microdata, 02/15/23 Still time to respond to the 2022 Census of Agriculture, USDA to follow up with producers who have not yet responded, 02/15/23 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), 01/31/23 United States cattle inventory down 3%, 01/30/23 2022 Census of Agriculture due next week Feb. 6, 01/12/23 Corn and soybean production down in 2022, USDA reports Learn . corn and 59 bu. It will take nearly all of that to reach Johnson's projected net return to the farmer of $86.60 an acre for corn. Corn is seen as a staple in the average family diet. At $75 per ton, that's an extra $40 per acre in profit to the grower. In an average year, Iowa produces more corn than most COUNTRIES! First, fertilizer and lime costs include volume and early purchase discounts. But despite this volatility, corn farmers are still making some good profit from their corn farms, depending on the yield of that year. Overall, costs have increased dramatically since 2020, from $577 to $860, an increase of $283 per acre, or a 49% increase. At 180 bushels per acre, it is $3.58 per bushel. 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. In a year with low-corn-price predictions, every input must be reviewed to lower the cost of production. While advancements in technology make producing corn more efficient, there are still commodity markets that must be contended with to make the industry more profitable. All Rights Reserved. Average costs per bushel have been $1.26 to $1.74 in the cash grain division, and $1.13 to $1.81 in the dairy and livestock division. Winter Wheat Seedings up for 2023, NASS to publish milk production data in updated data dissemination format, USDA-NASS Crop Progress report delayed until Nov. 29, NASS reinstates Cost of Pollination survey, USDA NASS reschedules 2021 Conservation Practice Adoption Motivations data highlights release, Respond Now to the 2022 Census of Agriculture, 2017 Census of Agriculture Highlight Series Farms and Land in Farms, 2017 Census of Agriculture Highlight Series Economics, 2017 Census of Agriculture Highlight Series Demographics, NASS Climate Adaptation and Resilience Plan, Statement of Commitment to Scientific Integrity, USDA and NASS Civil Rights Policy Statement, Civil Rights Accountability Policy and Procedures, Contact information for NASS Civil Rights Office, International Conference on Agricultural Statistics, Agricultural Statistics: A Historical Timeline, As We Recall: The Growth of Agricultural Estimates, 1933-1961, Safeguarding America's Agricultural Statistics Report, Application Programming Interfaces (APIs), Seasonal Summary of Crop Progress and Condition/All Crops and All States, Economics, Statistics and Market Information System (ESMIS). Government programs called Agriculture Risk Coverage (ARC) and Price Loss Coverage (PLC) can help farmers protect against the risks of weather and prices. In the latest projections used for the 2021 report, corn yields are 2 bushels higher than for 2020, while soybean yields remained unchanged. A string of great crops from 2010-2013. The USDA pegged the U.S. corn yield at 168.4 bushels per acre vs. the average trade estimate of 167.5 bu./acre and its previous estimate of 168.2. Arable Farmer. corn takes the worst figure in the study to the third best at $144 per acre profit . {\U{f~uoos;h?zYQ HUoTn>'?{GYHY S|DB?QBZ?Bj+W?=}(]'+?L p?8Pv' B5UFWVTM}UJ9{QGQ4tOygp9 z,OloloKOlfo+V} \f>8t&^U `H198R00t(0TM Up!X ['SMezWgop%B R 1&[UMSi4!k Zm]4#7{qmS7v;lW->b.%I zv9 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. In 2023, total costs are projected at $1,161 per acre, up from the $1,054 level in 2022. Given higher costs, break-even levels for northern Illinois for corn are $5.34 per bushel on cash rented land. The most profitable farm made $275 per acre while the least profitable lost $222 per acre. All records were kept on the accrual, or inventory, basis. I do think were going to see more interest in flex rents, Johnson said. In the livestock corn division, the average cost per acre is $206 (minimum = $186 during 1993; maximum = $235 during 1987). 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. How Much Profit Per Acre of Corn Can a Farmer Make Yearly? corn and 59 bu. State Corn Yield Per Acre: Causes of Variations. We use a great deal of rope for odd jobs around the farm and at various community events. Iowa State University Extension and Outreach, Managing farm costs key to profitability in 2021. Current futures prices seem to indicate that corn and soybean prices might average $4.45 and $11.40 per bushel in 2021/22, respectively. Click Image to Enlarge Changing Use Impacts Corn and Soybean Returns Total costs are projected at $785 per acre, with $476 per acre in non-land costs and $309 per acre in cash rent. U.S. farmland values remained high in 2020, averaging $3,160 per acre, a small decrease of 0.8 percent compared with 2019. "Nitrogen Fertilizer Outlook for 2023 Decisions." Corn yields were maximized near a final stand of 33,000 plants per acre and were not reduced as plant population increased to 44,000 plants per acre. Interest rates, energy prices, and wage rates continue to increase, and supply issues that began in Covid have not been resolved. The highest returns are in central Illinois with high-productivity farmland, with farmer returns of $8 for corn and $43 per acre for soybeans. 4 0 obj 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. Want more news on this topic? 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. Email: askusda@usda.gov . Lower commodity prices are possible from any number of causes. 710,250 miles. But farmers also must maintain a production level that will result in profitable returns. More than 200 counties across the Corn Belt had county average rental rates above $200 per acre, with . Corn stocks down, soybean stocks down from year earlier Variable costs: Fuel, fertilizer, seed, irrigat. 2023 Meredith Corporation. Take, for example, the Central CRD in Illinois. The average cost per acre has been $238 (minimum = $215 during 1995; maximum = $260 during 1992). Price = $5.00/bushel 2. This . The 2023 farmer return is projected to be close to the average from 2013 to 2019 when the return averaged $29 per acre. 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. Opportunities to price at those levels do not exist currently. Corn production would not be profitable in a continuous corn scenario if the price per bushel is $3.65. The average cost per acre in the livestock corn division is $206 (minimum = $186 in 1993; maximum = $235 in 1987). Written byAlejandro Plastina,Extension Economist,plastina@iastate.edu. Gross income = $950 / acre 4. Iowa produced almost 500 times more corn than Utah, which ranks #41 in US corn production by state. Your email address will not be published. Projected prices are $5.30 per bushel for corn and $12.70 for soybeans, near current 2023 fall bids. Cost of production in 2018 is predicted to be $645 per acre . How many farmers know what their inputs are, let alone their costs per acre or per bushel? Will Bird Flu Become a Recurring Issue Each Year. CFAP isnt the only corona virus-related program that farmers might be able to use. Because of industrial, seed, planting, and other kinds of modifications, what used to take days to plant can now be done in minutes. To see all exchange delays and terms of use, please see https://www.barchart.com/solutions/terms. %PDF-1.5 Explore Statistics By State By Subject Crops and Plants Demographics Economic and Prices Environmental Livestock and Animals Research, Science, and Technology Charts and Maps ISU used a a corn yield target of 200 bu./acre with an average price of $3.10 per bushel. % Profitability risks will be mitigated over time as input prices are locked in and as projected prices for crop insurance are set in February 2023. Yields are set at trend levels for 2023, with trends established through historical yields. Seriously, Iowa grows about three times as much corn as a country like Mexico. While commodity prices are projected lower, those prices still are not low by historical standards. The U.S. Department of Agriculture's National Agricultural Statistics Service reported on Friday that Iowa averaged 200.0 bushels per acre for corn and 58.5 bushels per acre . The 2020-2021 national average corn price, which will be finalized on Sept. 30, is now estimated at $4.40 per bushel. The projected season-average farm price is unchanged at $4.00 per bushel. <> Decision Tools on the Ag Decision Maker website, ISU cost of production estimates for 2021, https://www.youtube.com/watch?v=xuxGMkKuzeE. With an average direct cost of $751 per acre of corn and $900 in sales, the farmer has about $149 left. Total non-land costs for corn are estimated at $420 an acre and for soybeans at $266 an acre. It will be on corn for the 2020 crop but not received until October 2021.. For soybeans, he estimates smaller federal payments of $32 an acre. Have a specific question for one of our subject experts? Profits from soybean production would exceed $110 per acre. where did the 198,870 kWh per acre in Iowa come from? 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). (Source: USDA, Jan. 2021) Depreciation is estimated at 10% of current value of the machinery. The factors that are causing those cost increases are inflation, including wages and labor, fuel and just general supply disruptions further exasperated by the Ukrainian Russian war, he says. <>>> At a Farmland Owners Update webinar, Johnson said he estimates that Iowa farmers, on average, will receive about $95 an acre in federal payments for the 2020 corn crop. Required fields are marked *. Davis Michaelsen and Editor Brian Grete discuss this week's market action From conventional horizontal tillage to strip-till and no-till, the key is applying a production system that can overcome each fields weakness. 1.494 billion bushels of Iowa corn in the 2018/19 marketing year went into corn processing used in the wet mill industry for food and industrials usage. All https://www.barchart.com/solutions/ is provided by Barchart Solutions. The key points to remember when growing popcorn is to make sure it doesn't cross pollinate with other corn you may be growing. At the same time, farm income was forecast to increase nationwide in 2020 (see Farm Income and Wealth Statistics for details). Another is the Paycheck Protection Program, designed to help small businesses keep employees on the payroll and meet other costs. Producers must have a strong grasp of their own production costs, and the ISU Extension report provides a step-by-step guide to help them estimate break-even costs, and serves to benchmark operations and trigger relevant questions on how to better manage enterprise costs. How can I make money with 10 acres? This compares to U.S. corn yields of 172 bushels per acre in 2020, 167.4 bushels per acre in 2019, 176.4 bushels per acre in 2018 and the current record U.S. average . Contract grazing: A flat rate is paid per animal per month or per day by the livestock owner to the landowner. Fuel and insecticide costs, interest expenses on pre-harvest input financing, and crop insurance premiums are projected lower in 2021. While 2023 is projected to be profitable, risks exist. 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. Loans can be made through June 30 and this is money available, Tidgren said. Corn has been grown across the United States and other parts of the world for hundreds of decades. In 2023, total costs are projected at $1,161 per acre, up from the $1,054 level in 2022, Schnitkey says. The publication also includes budgets for alfalfa hay establishment with an oat companion crop and by direct seeding. The state average soybean yield was 58.5 bushels per acre, down 4.5 bushels from 63.0 bushels per acre last year. Table 2 shows actual results for northern Illinois for 2021, along with projections for 2022 and 2023. 3: How much better is this field than the county average? An analysis of state average corn yield history data provided by the USDA NASS indicates there are two causes of corn yield (in bushel per acre) variations at the regional level in the United States. Required fields are marked *. Higher yield ratios indicate that corn is relatively more productive than soybeans, and vice versa. Farmers need to manage nutrients and pesticides carefully to avoid adverse effects on the environment and to reduce the costs of purchased inputs. For example, if the custom rate for chopping, hauling and storing silage is $10.00/ton, the value of the standing silage to the buyer is reduced to $41.23 - $10.00 = $31.23 per ton, or $624.60 per acre. "pdf" file that you can access by clicking here. Client Corner: Where can I find average prices for corn and soybeans? The total cost per bushel of soybeans is projected at $9.04 for non-herbicide-tolerant beans at 56 bushels per acre, according to the report. Projected returns range from $13.50 per acre for dryland corn to $194.55 per acre for irrigated corn. #18. That is much lower than the return in 2021 when we had a record $413 per acre, and it is also above 2022 projections for returns of $156 per acre.. A safety net under revenue will be established when projected prices for crop insurance are determined in February 2023. Farm Bureau members may subscribe for a free email news service, featuring the farm and rural topics that interest them most. 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. Woody ornamentals. endobj Very large or small farms may have lower or higher fixed costs per acre. Non-land costs are projected to be $860 in 2023, up from $758 in 2022. USDA projections for 2020-2021, published in October 2019, put the average U.S. farm prices for corn and soybean at $3.40 and $8.85. Member. A decline in commodity price likely would not be associated with similar decreases in cost levels, reducing already narrow margins. Soybeans are projected to be more profitable in all regions of Illinois (see Table 1). 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. It allows you to customize your query by commodity, location, or time period. Knowing costs is key, as it is to understand the assumptions behind the budgets used in the calculations. Guidelines are available here. Overall, costs have increased dramatically since 2020, from $577 to $860, an increase of $283 per acre, or a 49% increase. Futures: at least 10 minute delayed. 1.3 Billion bushels) of winter wheat in 2019. For the 2020 crop year, USDA estimates U.S. corn yield to be 181.8 bushels per acre , surpassing the previous record-setting estimate of 178.5 bushels per acre earlier this year. We are projecting higher fertilizer costs in 2023. The average yield of corn (bushels per acre) for Iowa counties during 2022 follows a bell-shaped (symmetric and unimodal) distribution with a mean of 180 bushels per acre and a standard deviation of 24 bushels per acre. Corn has been grown across Iowa for more than 150 years, nearly 30,000 kernels are planted per acre, and corn yields can be close to 200 bushels per acre in a good year on high CSR land. Actual costs can be entered in the column for Your Estimates, or by using the electronic spreadsheet Decision Tools on the Ag Decision Maker website. Hunting income is available to farmers. Offer indoor or outdoor storage. 1 0 obj Your email address will not be published. Variable cost per acre peaked in 2013 at $462 per acre ($2.83 per bushel), and is projected to be $408 per acre ($2.27 per bushel) in 2021. This material may not be published, broadcast, rewritten,or redistributed. Over time, corn yields have increased an average of 2.0 bushels per acre, while soybean yields have increased by .5 bushels per acre. You list seed costs as the same for corn after corn rotation as corn after soybeans. The tables are calculated on a per acre basis. hb```b``fb`e`0ed@ Aa,Y 4>hNem}AS1d03r3yU b<4,dPC765b/N`` r::y;L}/X8Q!7j0c|xq)f$=x>dC1^ ]< LK@&q;k !|HJ``*5 |pU_D u Z!, The data for this report were collected by Iowa Farm Business Association consultants and compiled by Iowa State University Extension and Outreach. For corn, Johnson estimates a PLC payment of $65 an acre. The 1964 Iowa corn yield test Agricultural price and income policy has been in place in different forms since World War I. Projected prices are $5.30 per bushel for corn and $12.70 for soybeans, near current 2023 fall bids. Table 2 shows actual results for northern Illinois for 2021, along with projections for 2022 and 2023. At the farm level, the study predicts it could mean over $40,000 per acre in revenue, depending on quality and yield. Your email address will not be published. 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. 7 . The United States grew 1,304,003,000 bushels (i.e. Since 2020, total costs have increased from $833 per acre to $1,161, an increase of $328 per acre, or 39%. A continuous corn system would not be able to cover all costs even with high yields, and corn production following soybeans would generate $30 to $40 per acre in profits.