Grain-farm income to plummet this year in Midwest

A farmer with 1,500 acres of highly productive land in central Illinois could see net income this year that is a fraction of last year – around $7,500 versus more than $103,000 in 2014, says U-Illinois economist Gary Schnitkey. In deriving the figure, Schnitkey started with estimated returns of $244 an acre this year after production costs, and then subtracted land, property tax and interest charges on farmland debt. The various land costs were apportioned according to the typical amount of land that a grower would own or rent.

“Overall, substantial decreases in incomes are projected for 2015,” writes Schnitkey at farmdoc daily. Farms that pay cash rental for land will likely see the biggest drops because rental rates, on average, are $41 an acre higher than likely returns after the crops are sold and production costs are paid.

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