Beans Making Comeback

Last fall the talk in farm circles focused on the demand for corn and how the market favored corn production. But in one short year, the tables have turned making soybeans the crop most in demand going into 2008.

Both crops, along with wheat, are likely to be profitable in 2008, says an agricultural economist with the University of Kentucky (UK) College of Agriculture. But the price ratio between corn and soybeans definitely favors soybeans.

"Farmers will have to respond to the market," says Kenny Burdine, UK ag economist. "It doesn’t mean they should totally abandon their crop rotation, but there will be a shift toward more beans."

The shift toward soybeans will be price-based, but it is also the logical crop rotation pattern on most Kentucky farms with full-season or double-crop soybeans/wheat typically planted following corn.

In 2007, Kentucky growers and growers across the nation responded to market demand for more corn with Kentucky producers planting 295,000 fewer soybeans acres and 320,000 more acres of corn.

Nationally, the result was a 21 percent increase in harvested acres allowing production to exceed the increase in use, giving the corn supply a slight cushion. At the same time, soybean acres and yields dropped, resulting in an 18 percent smaller crop in 2007 than 2006. Soybean use has been steady making for a very tight supply for the upcoming year and setting the stage for much higher prices in late 2007.

As a result, many soybean acres lost to corn in 2007 will likely return in 2008. In Kentucky, a number of those acres will be double-cropped soybeans following the winter wheat crop. Wheat prices are also strong, encouraging farmers to grow that crop as well. Those acres were planted in October and early November, but the actual number is not yet known. Nationally, soybean production is likely to increase by four to seven million acres in 2008.

"Unless something drastically changes between now and spring, we won’t see many continuous corn acres in 2008," Burdine says.

Demand for corn, wheat, and soybeans is expected to remain strong through 2008, and barring major weather problems, it should be a profitable year for grain producers, Burdine says.

Prices for 2008 corn and soybeans have been trading in the $4 and $10 range, respectively, on the Chicago Board of Trade. With prices at these levels, it is not too early to price a portion of the 2008 crop, Burdine says. There are several options growers have in forward pricing.

"But if anything was learned in 2007, it was that contracting too high a percentage, too early, can leave you worried about making delivery," Burdine says. "So, since the crop isn’t even in the ground, farmers need to be realistic about the amount of grain that is forward priced."

(Source: University of Kentucky)
 

Leave a Reply

Latest News
CropLife 100Allied Ag Distributors Adds Four New Owners
July 30, 2015
Aligned Ag Distributors LLC has announced the addition of four new customer/owners to Franklin Holding Co. LLC. They are: The Read More
FungicidesReport: Sudden Death Syndrome Symptoms Appearing In Soy…
July 30, 2015
Last week, symptoms of sudden death syndrome (SDS) began to appear in April 15-planted soybeans at the University of Illinois’s Read More
Seed/BiotechAdvanta Seeds Adds New Phoenix Corn Hybrids
July 30, 2015
Corn growers in the High Plains and Western states have new options available for the 2016 growing season from Advanta Read More
ManagementTechnology and agriculture: a Futurist’s Perspective
July 30, 2015
Futurist David Zach, speaking at this week’s InfoAg Conference in St. Louis, shared thoughts on the benefits and limitations of Read More
Biofuels Plant in Lousiana
Industry NewsIdle Biofuels Plant In Louisiana To Reopen As Ammonia F…
July 30, 2015
A Lithuania-based company plans to spend $265 million to reopen an idle biofuels refinery in Grant Parish as an ammonia Read More
FFA at Monsanto Booth at the 2015 National Farm Machinery Show
Industry NewsFive Students Receive The 2015 Monty’s Plant Food Compa…
July 29, 2015
This fall, five college-bound students will have financial support through the Monty’s Plant Food Company FFA Scholarship. All five scholarship Read More
GYPSOIL Blendable Pellets
Crop InputsBeneficial Reuse Management Launches Pelletized Gypsum …
July 29, 2015
Beneficial Reuse Management (BRM) announced this week at Ag Media Summit that its GYPSOIL Pelletized Products Division will open a Read More
StewardshipOhio Water Quality Project To Determine How Much Phosph…
July 27, 2015
Researchers with the College of Food, Agricultural, and Environmental Sciences at The Ohio State University are looking for farmers in Read More
FertilizerKoch Agronomic Services Launches N-TEGRATION Technology
July 27, 2015
Koch Agronomic Services, LLC (KAS) has launched  N-TEGRATION Technology, a process technology platform designed to enable production of enhanced efficiency fertilizers at Read More
HerbicidesExpert: IARC Herbicide Classifications Leading To Confu…
July 24, 2015
Few people in the crop protection industry had heard of the International Agency for Research on Cancer (IARC) before this Read More
ManagementFCI Trade Summit Update & Precision Tank Turns 50
July 23, 2015
Editors Dave Frabotta and Eric Sfiligoj discuss the upcoming FCI Trade Summit in Las Vegas, NV, and how Precision Tank Read More
Palmer pigweed seedhead in cotton
HerbicidesUSDA Deregulates Dow AgroSciences’ Enlist Cotton Trait
July 23, 2015
The USDA today issued its decision deregulating Dow AgroSciences’ Enlist cotton trait in the U.S. The USDA has now completed its Read More
Industry NewsVerdesian Life Sciences Showcases Versatile Product Por…
July 23, 2015
Technology has revolutionized agriculture by bringing farmers, retailers and distributors to the forefront of the digital age. To meet the Read More
FertilizerWSJ: Cf Industries Exploring Merger With Dutch Chemical…
July 23, 2015
U.S. fertilizer maker CF Industries is in advanced merger talks with Amsterdam-listed chemical company OCI NV, the Wall Street Journal Read More
HerbicidesNufarm Releases New Panther SC Herbicide
July 23, 2015
Nufarm has announced the availability of new Panther SC herbicide. Panther SC is the first liquid formulation of flumioxazin available Read More
EquipmentFarmLink Launches Farm Equipment Sharing Program
July 23, 2015
FarmLink has introduced a new online farm equipment sharing community – MachineryLink Sharing – leveraging this new economy business model Read More
HerbicidesCould The South’s Most Troublesome Weed Represent A Thr…
July 22, 2015
Palmer amaranth is undoubtedly the most troublesome weed in the southern United States, taking a devastating toll on both cotton Read More
Industry NewsH.J. Baker Hires New Director Of International Sales
July 22, 2015
Global Agriculture firm H.J. Baker announced today that Steve Langley has joined the company’s Crop Performance Division and Animal Health Read More