BLOOMINGTON, Ill. — The downturn in corn and soybean
prices as yield estimates rise highlights the importance of soil fertility and
“There is a common debate among farmers whether
increased bushels are more important when commodity prices are high as compared
to when they are low,” said Dave Mowers, AIM for the Heartland consulting
“Both are important, but my contention is that increased
production is more important when commodity prices are low.”
His belief is when prices are lower, margins also
generally are lower, and the percentage impact of higher production is greater
when margins are lower than when they are higher.
“No matter what, higher production is necessary in order
for farmers to remain competitive, no matter what the market price is,” he
Net income is more challenging with lower commodity
prices, and increasing production while keeping input costs down helps turn a
“One of the challenges is that costs of inputs and land
are going down slower than grain prices. Therefore, profitability is much more
of a challenge, and it does not look like it will soon get better,” Mowers
The Catch-22 in this is cutting the cost of inputs to
save money also costs yield.
During the past few years of high corn and soybean
prices, farmers found there were certain management practices that increased
yields while other practices did not.
Cut Costs Cautiously
“Remember what worked and use those practices to keep
production high. Don’t cut costs just to reduce cost per acre --it can come back
to haunt you,” Mowers said.
The first step in any farm management program to manage
input costs is to do soil tests to monitor nutrient levels. If the levels are
low, add extra nutrients to increase production. If the levels are high, reduce
nutrient applications rates.
“You don’t want to cost yield, but virtually every soil
test will find some surplus and some deficiency,” Mowers said.
“The idea is to reduce inputs on high-testing areas and
increase inputs on low-testing areas, with the effort to get maximum production
with the most economical rate of inputs on every acre that is farmed.
“We have all watched the price collapse, and it is easy
to kick yourself for not taking advantage of higher prices at an earlier time.
You cannot do anything about the past, so give it a rest.
“Let’s think ahead and get a plan.”
Tom C. Doran can be reached at 309-828-1432 or
email@example.com. Follow him on Twitter at AgNews_Doran.