Farmers watch crop returns rise as production costs follow

Farmers will spend more to produce their 2011 crops but they're likely to make that up and then some from higher grain prices, say two Purdue University Extension specialists.

Which crops farmers choose to plant this season also will play a factor in the returns they'll earn, said Craig Dobbins and Bruce Erickson of Purdue's Department of Agricultural Economics. The numbers suggest a corn-soybean rotation is the best choice, with double-crop soybeans/wheat a good option for those farmers living in areas where that cropping system is viable.

"At this point in time, contribution margins the difference between gross revenue and production costs are really quite large," Dobbins said. "If one is looking for a place to expend energy from now until you can get out into the field and plant, I think one ought to focus that energy on protecting the margin that you've got in crop production today." Read more ...

This blog is written by Martin Little The Global Miller, published and supported by the GFMT Magazine from Perendale Publishers.