Spring 2015 Logan County
Farm Outlook Magazine

The cost of corn-on-corn
By Derek Hurley

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[April 06, 2015]  That time which farmers plan for all year is here – it’s now time to plant for the growing season of 2015.

What will Logan County farmers be planting?

Previous years indicate that the corn production will remain a high priority for the majority of farmers in Logan County. For some farmers, the trend of continuing to grow corn instead of switching to beans (also known as corn-on-corn production or continuous corn) is appealing.

The trend began in 2007, when Logan County corn acreage peaked at 231,500 harvested acres, producing a record 197 bushels per acre. The following two years resulted in slightly lower yields of 188 bushels per acre, a number that fell drastically to 155.7 in 2010.

The most recent 2014 season, Illinois set a new record of 200 bushels per acre; 22 bushels higher than the 178 bushel average of 2013.

Logan County did considerably better than the state for the 2014 season, averaging 230.8 bushels per acre.

According to data released in February by the National Ag Statistics office, Logan County farmers planted 201,500 acres of corn. Out of that total 200,000 acres were harvested.
 

Soybeans

As for soybeans in 2014, Logan County farmers planted 136,500 acres of soybeans. 136,300 acres were harvested with an average yield of 63.7 bushels.

So what is the broad overview of corn vs soybeans?

Continuous corn

Corn is known for typically being more profitable when compared to soybeans at harvest time. But is that profit without risk? In order to answer that, we need to look at a few factors involved in planting continuous corn.

A factor to consider is the presence of fertilizers and pesticides. Potential profits are affected by the quantity of necessary fertilizers and pesticides used. Soybeans replace some of the nutrients that corn takes from the soil. As a result, there is a potential for a reduced need for fertilizers.

On the topic of nutrients in the soil, there is a belief held by some farmers that continuous soybean planting may be just as risky as continuous corn planting. According to a May 2014 news release from Illinois Farmer Today, soybeans planted after soybeans may be less resistant to disease and more taxing on the soil.

On the other hand, corn that is planted after a pervious corn crop may be less resistant to disease and more susceptible to cob rot; as opposed to corn planted after soybeans, that corn may be more resistant.

Continuous corn planting also carries the risk of yield drag as the harvest numbers decrease due to diminishing returns.



Soybeans, while still reduced in harvest numbers after continuous planting, do not experience the same level of loss at harvest.

Another factor to consider is the value of cash rent

The 2014 USDA report reveals that Logan County had the highest cash rent in Illinois at $308 per non-irrigated acre. Farmers paying higher cash rents to landowners in past years continued growing corn to earn a greater profit for themselves.

Soybeans, despite selling at higher prices, are not subject to the same level of demand as corn, and average yields are generally much lower.

Comparatively, corn is typically chosen over soybeans as it offers broader marketability and its higher yields sufficiently make up for corn’s lower price.

The strategy of continuous corn sounds counter-productive when compared to the typical methods of crop rotation. According to the 2012 crop budget report provided by the University of Illinois Agricultural Department, greater gross revenue will result from the planting of soybeans after two years of planting corn.

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According to a five-year study conducted by the U of I and published in 2013:

“The data for 2013 indicates that there was little if any yield advantage or disadvantage of a higher percentage of corn acres…
 

  • Higher percentages of corn production leads to increased costs per acre for fertilizer, pesticides, and seed as represented by the increasing disadvantage of the higher corn percentages.
     
  • Power and equipment cost exhibited this same trend.”

The study concluded that the data (see table- provided by the University of Illinois Ag Extension) for 2013 suggests that revenue was higher at the higher percentages of corn acres, but there was a greater cost to produce that increase.

As is the case with any business model, the desire for greater profits is the reason for the use of continuous corn planting in the fields.

In summary, the continuous planting of soybeans comes with similar risks, but they may not be as steep as once thought. Overall, corn is a more profitable crop, but it makes greater financial sense in the long term to plant beans for a year (or possibly more) after three or four years of corn.

If all corn and soybean acres in Logan County were on rotation and practicing two years corn, one year soybeans, on the 338,000 acres planted last year the multi-year averaged split would be 225,333 acres corn and 112,666 acres soybeans. Last year’s records show that Logan County farmers planted 201,500 acres corn to 136,500 acres soybeans.

Logan County 2014 production was considerable better than the state averages on both corn and soybeans.
 
Crop State Avg.
Bu/Acre
Logan Co
Bu/acre
Corn 200 230.8
Soybeans 56 63.7

The farmer must also consider numerous factors in each year's planting choice: results of last year's harvest, fertilizer needs, prior year weeds and diseases, projected costs and market demands.

Articles cited

Is There An Advantage To More Corn Acres in Your Rotation?

Farmers love corn too much to grow continuous soybeans

 

Read all the articles in our new
Spring 2015 Logan County
Farm Outlook magazine

Title
CLICK ON TITLES TO GO TO PAGES
Page
2014 Year in Review 4
The year producers won the battle 7
How GMO regulations affect exports 9
GMOs and Biotechnology: Facts and Fiction 13
What are the impacts of last year? 16
Using corn storage as a hedge 20
Is fall tillage really necessary? 23
The cost of corn-on-corn 30
CASH RENT:  The Great Equalizer 34
Lowering your costs may increase your risks 37
Will lower fuels costs make farming profitable in 2015? 39
Mr. Allen and the Mount Pulaski FFA, a natural fit 40
Ag Scholarships 44
2014 County crop yields 52

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