Higher yields, but lower corn prices predicted

Economist expects slightly higher soybean prices

By Gary Brock - [email protected]



Corn growers got bad news at the Southwest Ohio Corn Growers and Fayette County Extension Agronomy Day this week. The news for soybean growers was only a little better.

Luncheon speaker Gary Schnitkey, agriculture economist at the University of Illinois, told more than 200 southern Ohio farmers that 2016 is not going to be a profitable year for them.

He said that corn prices per bushel should average about $3.15 this year compared to $3.60 in 2015, with soybean prices per bushel at about $9.15, up slightly from the $8.95 average last year.

“We are looking at least another year (2016) of lower corn and soybean prices, and probably 2017 as well,” he predicted.

But he had good news, of a sort.

“We are looking at record yields for corn — more than 15 billion bushels of corn produced in the U.S.,” he said. “This will be a record-breaking yield,” but he added that, “This will put pressure on the prices. All of these factors lead to higher production and lower prices.”

He said we are also looking at just over four billion bushels of soybeans produced, “and this will be a record harvest. Again these record yields will lead to overall lower crop revenues over much of the corn belt.”

He gave Fayette County as an example of this impact of yield and prices. He estimated that this year, corn yield will be about 185 bushels per acre, “which is probably high,” a seven bushel jump per acre over 2015. However, last year, corn sold on average for $3.80 a bushel, earning $676 per acre. The increased yield this year can’t offset the drop in price of $3.15 however, yielding just $583 an acre.

For soybean growers, the news was just a little better. Schnitkey predicted prices per bushel here in Ohio of about $9, and yield per acre of about 57 bushels, both a slight increase over last year. The soybean per acre revenue would be about $17 over last year’s $496.

“It is not going to be a good year. And 2017 doesn’t look that good either,” he said. But he did add that some costs have dropped for farmers, especially the cost of fertilizer. “But probably this won’t be enough to offset the drop in revenue from the decrease in prices,” he said.

Schnitkey ended by apologizing for the forecast.

“Sorry that my message was not more upbeat than that, but that’s where I think we are at. We have been through these times before. This is agriculture. We have good times and we have bad times, and we will have good times again,” Schnitkey told the farmers, pointing to the future growth of exports into other countries.

Also speaking at the Agronomy Day at the Fayette County Airport were Tadd Nicholson, executive director for the Ohio Corn Growers Association, who talked about the need for the approval of the Pacific trade agreement; Jay Brandt of Walnut Creek Seeds, who spoke about the variety of cover crops and their benefits; and Tim Norris, CEO of Ag Info Tech, who discussed variable rate spraying of nutrients.

Fayette County OSU Extension Educator Ken Ford said he thought the day went very well.

“Considering the weather, we have had a good crowd,” Ford said. “All of the speakers were pleased with the number of people attending the sessions. We’ve gotten a lot of good comments.”

Gary Brock, editor of the Civitas Media agriculture publication Rural Life Today, can be reached at 937-556-5759 or on witter at GBrock4.

Economist expects slightly higher soybean prices

By Gary Brock

[email protected]