Evaluating economic alternatives for late planting

[June 05, 2009]  URBANA -- Adverse planting conditions this spring have resulted in late plantings across much of Illinois. While a great deal of progress has been made in the past week, there are still fields that have not been planted, making future cropping decisions critical.

"Farmers who have not planted on fields scheduled for corn have three options: Plant corn whenever it becomes possible, plant soybeans, or take a 'prevented planting payment,'" said Gary Schnitkey, University of Illinois agricultural economist.

Under the "plant corn anyway" option, Schnitkey says farmers should expect corn yields to be lower than corn planted in a timely fashion.

"In addition, insurance guarantees will be lower if an APH, CRC or RA insurance policy has been purchased and the final planting date has been reached June 5, for most of Illinois, and May 31 for the seven southernmost counties in Illinois," he said.

If a farmer decides to plant soybeans, expected yields have not been reduced as much as for corn.

"Also, insurance guarantees for APH, CRC and RA insurance policies will not be reduced until the final planting date has reached June 15 for northern Illinois and June 20 for southern Illinois," said Schnitkey.

If farmers choose to take a prevented planting payment under an APH, CRC or RA insurance policy, the payment is 60 percent of the guarantee offered by the insurance policy.

"Farmers should consult with their insurance agents, as there are rules to follow to ensure prevented planting payments," said Schnitkey.

These important cropping decisions are discussed in a recent www.farmdoc.edu posting. Included is a link to a "FAST tool" -- a spreadsheet developed to aid in evaluating the three alternatives.

[Text from file received from the University of Illinois College of Agricultural, Consumer and Environmental Sciences]