2005 corn and soybean revenue
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University of Illinois Extension projections indicate returns
will be lower and costs higher for Illinois corn and soybean
producers in 2005. The full report, "2005 Corn and Soybean Revenue
and Cost Estimates," is available online through Farmdoc at
"Returns in 2005 are forecast to be considerably below 2003 and 2004
returns and are near 1998, 1999, and 2000 levels," said Gary
Schnitkey, U of I Extension farm financial management specialist who
co-authored the report with Dale Lattz, also an Extension specialist
in farm financial management. "Lower effective prices -- market
price plus loan deficiency payments -- and higher costs contribute
to the 2005 returns decreases. Yields used for the 2005 forecast are
based on the 2000 through 2004 average yields, which are also lower
than the projected 2004 yields.
"Costs are projected higher in
2005, as well. Major increases occur in fertilizer costs. For corn,
variable costs are projected to be up by $6 and $9 per acre. For
soybeans, those costs may go up by $4 to $5 per acre."
The report looks at four region and yield categories: northern
Illinois, central Illinois with high-productivity farmland, central
Illinois with low-productivity farmland and southern Illinois.
Forecasts are compared to historical returns for Illinois Farm
Business Farm Management grain farms from 2000 to 2003 along with
preliminary estimates of 2004 returns.
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Schnitkey said corn is forecasted to be more profitable in 2005
"Corn returns are forecast to be $51 per acre higher than soybean
returns for northern Illinois, $53 for central Illinois with
high-productivity farmland, $49 per acre for low-productivity
farmland in central Illinois and $29 per acre in southern Illinois,"
Soybean returns are estimated without considering yield losses or
cost increases due to soybean rust. Rust could change costs.
As always, projections for next year's return may differ
dramatically from actual results, Schnitkey noted.
of Illinois news release]