Published Saturday October 10, 2009
DES MOINES (AP) — Bin-busting harvests of corn and soybeans may do little to help farmers already struggling with low prices and high production costs, a farm economist said Friday after the latest crop projections were released.
The Washington-based National Agricultural Statistics Service is forecasting the second-largest corn harvest on record and a record soybean harvest.
Neither comes as a surprise, because more acres were planted this year, and earlier forecasts also had predicted a strong crop, said Lance Honig, chief of the crops branch of the National Agricultural Statistics Service, a division of the U.S. Department of Agriculture.
Corn production is estimated at 13 billion bushels, up 8 percent from 2008. If that holds true, it will be second only to 2007, when 13.04 billion bushels were harvested.
Gary Schnitkey, a farm economist at the University of Illinois at Urbana-Champaign, said record production usually results in farmers getting lower prices for their crops.
“This year, we’re actually looking at pretty low incomes for farmers — not only with the fall of commodity prices, which began last year at this time, but at the same time the costs farmers have had to pay have been high, particularly fertilizer,” Schniktey said.
But the prospect of lower corn prices shouldn’t send consumers scurrying to the store in hopes of getting a break on their box of corn flakes, Schnitkey said.
“For the consumer, it doesn’t mean a lot,” he said. “A lot of agricultural products, the amount in a certain product is very small.
“It’s a big deal to producers, but by the time it reaches the end consumer, it has less of an impact.”
The beneficiaries of a giant crop are usually food processors and grain elevators, “because they’re running more product through,” he said.
He also said consumers overseas benefit, because other countries can import U.S. grain for a lower price.
Yields per acre are forecast to average a record 164.2 bushels this year, up more than 10 bushels from 2008.
Corn is grown in nearly every state, but the top five producers are, in order: Iowa, Illinois, Nebraska, Minnesota and Indiana.
A record harvest of 3.25 billion bushels is forecast for soybeans, up 10 percent from 2008.
Yields are expected to average 42.4 bushels per acre, the third-highest on record. The top corn states are also the biggest producers of soybeans.
Farmers say the challenge now is to bring the record crop in from fields drenched by rain, delaying the harvest.
