Corn leads bidding for 2013 acreage

decrease font size  Resize text   increase font size       Printer-friendly version of this article Printer-friendly version of this article

Each winter brings one of the most important functions of futures markets: Optimally allocating available cropland among crops competing for that land in the “ultimate land rent auction,” you might say.

The burden is on the world’s commodity buyers to 1) know just how much acreage will be needed to meet their collective needs for a particular crop, 2) have at least a rough idea of current comparative costs and returns farmers are looking at, and 3) bid more aggressively for the crop they need if it’s badly losing the auction bidding!

click image to zoom The table to the left (click to view large version) addresses item 2. It shows comparative costs and returns using current new crop futures quotes for the eight major crops, USDA’s latest estimates of 2013 operating (variable) costs of production. If you jot down the bottom line figures in the 2013 columns from top to bottom, you’ll see corn leads the pack by more than $100 per acre over the number two “bidder,” the world’s rice buyers.

Soybeans lagged corn by $272 per acre in profit potential at this writing. That should be giving world soybean buyers pause! If you rank the implied profitability for 2012 crops using drought-reduced yields, corn, beans and rice are still the top three, only rice leads the pack.

The trend yield assumptions and costs for 2013 won’t change much until spring. It’s the futures prices that will change. We recommend you create this table in an EXCEL spreadsheet yourself if you want to keep track of likely acreage mix into planting time.


Buyers Guide

Doyle Equipment Manufacturing Co.
Doyle Equipment Manufacturing prides themselves as being “The King of the Rotary’s” with their Direct Drive Rotary Blend Systems. With numerous setup possibilities and sizes, ranging from a  more...
A.J. Sackett Sons & Company
Sackett Blend Towers feature the H.I.M, High Intensity Mixer, the next generation of blending and coating technology which supports Precision Fertilizer Blending®. Its unique design allows  more...
R&R Manufacturing Inc.
The R&R Minuteman Blend System is the original proven performer. Fast, precise blending with a compact foot print. Significantly lower horsepower requirement. Low inload height with large  more...
Junge Control Inc.
Junge Control Inc. creates state-of-the-art product blending and measuring solutions that allow you to totally maximize operating efficiency with amazing accuracy and repeatability, superior  more...
Yargus Manufacturing
The flagship blending system for the Layco product line is the fully automated Layco DW System™. The advanced technology of the Layco DW (Declining Weight) system results in a blending  more...
Yargus Manufacturing
The LAYCOTE™ Automated Coating System provides a new level of coating accuracy for a stand-alone coating system or for coating (impregnating) in an automated blending system. The unique  more...
John Deere
The DN345 Drawn Dry Spreader can carry more than 12 tons of fertilizer and 17.5 tons of lime. Designed to operate at field speeds up to 20 MPH with full loads and the G4 spreader uniformly  more...
Force Unlimited
The Pro-Force is a multi-purpose spreader with a wider apron and steeper sides. Our Pro-Force has the most aggressive 30” spinner on the market, and is capable of spreading higher rates of  more...
BBI Spreaders
MagnaSpread 2 & MagnaSpread 3 — With BBI’s patented multi-bin technology, these spreaders operate multiple hoppers guided by independent, variable-rate technology. These models are built on  more...


Comments (0) Leave a comment 

Name
e-Mail (required)
Location

Comment:

characters left


Pacesetter Grain Hopper

The Pacesetter Gain Hopper features original and innovative ideas like the patented RollerTrap™, the industry’s easiest to open and maintain trap ... Read More

View all Products in this segment

View All Buyers Guides

Feedback Form
Feedback Form