As we wrap up 2011 and look what may happen in agriculture in 2012, I wanted to share a few excerpts I read on Corn & Soybean Digest online by David Kohl and Kent Thiesse.
2011 Year in Review by Kohl:
- Interconnectedness and convergence
- In the early part of 2011, it appeared that the U.S. economy was making a nice recovery. However, black swans or unusual events and the convergence of increased oil prices, Japan’s natural disaster and sovereign debt issues placed a damper on the consumer, and, therefore, businesses that provide consumer services
- Swiss Cheese
- Swiss cheese has become a good metaphor to describe the agricultural and U.S. economies. Some areas are in the islands of prosperity, while others are experiencing a recessionary feeling.
- Land values gone wild
- The grain industry, while experiencing high prices, has more at stake with higher variable input costs, and rapidly increasing fixed costs in terms of cash rents, land values and overhead cost for machinery and equipment investments
- Dairy and drought
- In the dairy industry, there has been a rise in prices due to exports of whey and dry milk powder. These high milk prices have been offset by high grain and other input costs. The hog and poultry industries have experienced similar trends.
- Extreme droughts in the southern plains and other areas have reduced cow and livestock numbers, which has resulted in higher prices for both cows and calves.
Looking Ahead to 2012 by Thiesse
- Crops
- The breakeven cost of producing corn at trend-line yields will likely be close to $5/bu. for corn for many producers in 2012, and $11/bu. for soybeans, which are increased compared to 2010 and 2011 levels. The expected 2012 breakeven prices compare to just over $3.50 for corn and near $8 for soybeans as recently as 2008.
- Crop producers also need to pay attention to the level of cash rental rates are for 2012, and may want to consider a flexible cash lease as an alternative to a straight cash rent lease. A good flex lease adjusts the final land rental payment, based on actual crop yields and prices during the year of production.
- Livestock
- Profit margins in the livestock sector improved considerably in 2011, and should remain quite solid in 2012.
- The big question mark for 2012 will be what happens to feed costs, which will likely be impacted by final 2011 crop production numbers and usage, as well as 2012 crop planting intentions.
- Land Values
- Land values ended the year at record levels throughout most of the Midwest, including one sale of farmland in Northwest Iowa for over $20,000/acre.
- Excellent farm profits in 2011, continued low real estate interest rates and high demand for farmland are likely to keep land prices strong in 2012; however, a significant drop in grain prices and reduction in profitability in 2012 could cause land prices to moderate later in the year.
- Renewable Fuels
- 2011 was a fairly profitable year for most of the ethanol industry. However, 2012 shows signs of being a bit more unstable, with challenges related to erratic input costs, unstable fuel prices and government uncertainty.
- Govt Programs
- Congressional leaders made some progress on the next farm bill late in 2011. However, no agreement was reached, so farm bill discussions will likely continue well into 2012, and possibly beyond.
Cheers from Ag on the Forefront to a prosperous 2012 in agriculture!
My partner and I stumbled over here by a different web address and thought I might
as well check things out. I like what I see so
i am just following you. Look forward to going over your web page yet again.
I have read so many articles or reviews on the topic of the blogger lovers but this
paragraph is really a pleasant article, keep it up.
adreamoftrains website hosting services
Howdy! Someone in my Myspace group shared this website
with us so I came to give it a look. I’m definitely loving the
information. I’m book-marking and will be tweeting
this to my followers! Fantastic blog and fantastic style and design.
I like the helpful information you provide in your articles.
I will bookmark your weblog and check again here regularly.
I’m quite certain I will learn many new stuff right here!
Best of luck for the next!
Heya i’m for the first time here. I came across this board
and I find It truly useful & it helped me out much.
I hope to give something back and help others like you helped me.
Thankfulness to my father who shared with me about
this web site, this blog is really amazing. cheap flights y2yxvvfw
What’s Happening i am new to this, I stumbled upon this I have found It absolutely helpful
and it has aided me out loads. I am hoping to give a contribution & aid
different customers like its helped me. Great job. cheap flights
2CSYEon
Greetings from California! I’m bored to death at work so I decided to
check out your blog on my iphone during lunch break.
I love the information you provide here and can’t
wait to take a look when I get home. I’m amazed at how fast your blog loaded on my cell phone ..
I’m not even using WIFI, just 3G .. Anyways, wonderful blog!
Thanks for sharing your thoughts. I truly appreciate your efforts and I
am waiting for your further write ups thank you once again. 3gqLYTc cheap flights
Excellent blog here! Also your site loads up fast!
What host are you using? Can I get your affiliate link
to your host? I wish my site loaded up as quickly as yours lol
Marvelous, what a blog it is! This webpage provides valuable
facts to us, keep it up.
If you are going for finest contents like I do, just visit this web page everyday for the
reason that it offers feature contents, thanks
Howdy! I realize this is kind of off-topic but I had to
ask. Does operating a well-established blog like yours take a lot of work?
I’m completely new to blogging but I do write in my journal daily.
I’d like to start a blog so I can share my experience and
views online. Please let me know if you have any kind of recommendations or tips for brand new aspiring blog owners.
Appreciate it!
Today, I went to the beachfront with my kids. I found a sea shell
and gave it to my 4 year old daughter and said “You can hear the ocean if you put this to your ear.”
She placed the shell to her ear and screamed.
There was a hermit crab inside and it pinched her ear. She
never wants to go back! LoL I know this is entirely off topic but I had to tell someone!
tiktok takipçi satın al