Farm Belt farmers are headed for the lowest returns in years for operator and land from their corn and soybean crops, says economist Gary Schnitkey of U-Illinois at farmdoc daily. Schnitkey says returns will be marginally better than his July calculations, based on current prospects for yields and market prices. In his example of an Illinois farm with highly productive soils and a corn/soybean rotation, corn generates a return of $255 an acre before land costs and operator income, $4 higher than his July estimate. For soybeans, the returns for land and operator are estimated at $233 an acre, $8 higher than Schnitkey projected in July.
“The last time corn had a lower operator and land return than projected for 2015 was in 2008. Soybean returns in 2006 were lower than the 2015 projected soybean return,” wrote Schnitkey. The returns “are projected to be below the 2015 average cash rent,” meaning an income squeeze for growers who rent, rather than own, land. “Revised gross revenues point to low returns and low net incomes for 2015,” he concluded.