A losing year for corn farmers?

Corn Belt farmers could lose money on this year’s crop if prices are in the range that USDA expects, says economist Gary Schnitkey of U-Illinois. At farmdoc daily, Schnitkey presents sample balance sheets showing potential revenues and costs for a corn farmer in central Illinois with high-yielding land. There is a $100 range for revenue, depending whether prices are $3.65 a bushel or $4.35.

“Farmer returns likely are negative for cash rented farmland, given that costs are near average,” he says. “Farmer returns for share rented farmland likely will be low.”

Writes economist Dan O’Brien of Kansas State University at his blog, “Absent an unforeseen major downturn in 2014 U.S. corn production…it seems likely that U.S. corn markets are moving toward a low price period similar to the fall of 2008, a marketing year in which U.S. corn prices were at or below $4.00 per bushel for at least a moderate period of time.” O’Brien says the corn crop is likely to total a record 14.64 billion bushels, or 6 percent larger than USDA projects.

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