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The 2013 Illinois Crop Budgets showed $563 per acre in non-land
costs, and subtracting this from the estimated income left $409 for
operator and land costs (source: Gary Schnitkey, University of
Illinois). That was figuring 198-bushel corn yields at $4.80 per
bushel. Yields are somewhat variable, but the cash price is running
well short of the $4.80.
On the soybean side, the same crop budgets were figured on
57-bushel soybean yields at $11.75 per acre. The non-land costs were
estimated at $350 per acre, leaving $342 per acre for operator
return and land costs. Soybean yields have also had some variation,
but prices have allowed October sales above those levels.
The hay and pasture yields have also been affected by the 2012
drought and the 2013 drought.
Yes, we have once again experienced drought in the central
Illinois area, with moderate drought increasing the number of acres
affected as fall has progressed. The main difference was that the
2013 year began with more moisture in the soil, and the dry weather
appeared about a month later than in 2012.
Hay supplies have remained tight, with relatively high prices,
and pastures have either been good or poor, depending on the stand
loss experienced last year.
Planting conditions were almost the exact opposite of 2012. The
2013 growing season saw much later planting, cool conditions through
the first half of the season and cooler temperatures for much of the
summer. We managed to escape widespread damage from an early frost,
and that was a worry until we reached October. The crop has also
been slow to mature and dry down, but September really moved things
along quicker than expected with unseasonably high temperatures.
Livestock producers continued to struggle financially compared
with producers having only crop production. Feed prices remained
high through the first half of the year, and this limited returns on
the additional labor involved in raising livestock. When feed prices
became more favorable, the livestock prices began to decline.
Raising livestock is still a tough business from a physical and a
financial standpoint.
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A major trend that seems to have caught hold is the "locally
grown food initiative." People want to know where their food is
coming from. There continues to be a move toward retailers buying
what they can locally, inclusion of locally grown items on the
school lunch menu and direct buying from farmers markets and
roadside stands. Several moderate and upscale restaurants have made
their names on preparing locally grown items. Locally grown items
tend to be fresher, have a better degree of ripeness and a better
flavor when served. This trend will continue, but for now, it
remains a niche market for specialty growers.
The 2014 prospects mirror the comments made in 2013: Prospects
will be dependent on rainfall received in the fall, winter and early
spring. Also, the law of supply and demand is alive and well. This
means that larger crops mean lower prices. Outside influences such
as the renewable fuels mandate, the possible move to including more
ethanol or soybean oil in fuels, larger numbers of animals consuming
feed grains and oilseeds, and various government programs will all
have an impact on this supply and demand.
The agriculture industry always looks forward to the next season
with optimism, and we are thankful for the bountiful harvest most
experienced in 2013.
[By
JOHN FULTON,
University of Illinois Extension]
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By John
Fulton
