From the Field: Locals banking on corn

Published 12:00 am Friday, March 17, 2006

VIDALIA &8212; All winter, farmers have been trying to figure out how much of what crops to plant this season.

And while the mild winter has increased the danger for Asian soybean rust, it has given corn farmers a chance to get planting a little earlier.

And while high costs of fertilizer and energy coupled with the low sale price has made corn less popular than in years past, local farmers report they will still be putting a considerable amount in the ground.

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Dr. Ron Gregg said he plans on planting close to 250 of his 800 acres with corn. After doing the math, he decided corn is a good investment.

He irrigates his corn, however, which increases the yield up to 50 percent compared to non-irrigated corn. That&8217;s a big difference.

&8220;If I didn&8217;t have irrigation, I wouldn&8217;t even consider corn,&8221; he said.

Most of Concordia Parish&8217;s acres aren&8217;t irrigated, and those considering planting dry-land corn have a lot to, well, consider.

The five-year yield average for non-irrigated corn in the parish is 105 bushels per acre. This number is skewed somewhat by the whopping 140 bushels per acre hauled in in 2001. Since then, the averages have been 85, 95, 105 and 100, respectively.

The acreage of corn planted, meanwhile, has come down sharply.

In the bumper 2001 year, the 150 corn farmers planted almost 30,000 acres. That number climbed to 47,642 acres the next year, just in time for the lowest yield in the five-year cycle.

The acreage dropped by half for 2003 and has continued to dwindle; 2005 saw just 14,375 acres produce corn.

December corn futures are trading in the neighborhood of $2.50 per bushel. At 105 bushels per acre, that brings a farmer $265 for every acre of corn he plants.

That&8217;s before expenses, however. Like everything else energy-related in the post-Katrina south, variable costs of farming corn are on the rise.

If it costs a farmer $175 to plant and harvest an acre of corn, that leaves him a $90 profit.

That number is before fixed costs for equipment and land are calculated, making the margin pretty slim in the non-irrigated cotton business.

With numbers like that, it&8217;s no wonder more acres are being devoted to soybeans and cotton, both of which are considerably cheaper to produce.

But there will always be a place for corn.

A.J. Vangilder said that, while he would plant most of his 2,500 acres with cotton and soybeans, he would save a couple of hundred acres of his irrigated land for corn.

That&8217;s being done mostly as a hedge.

&8220;The input costs are high and I&8217;m not comfortable with the price it&8217;s getting,&8221; he said.

&8220;But I&8217;ll plant some just in case.&8221;

The just in case scenario, one Gregg and others are playing, dictates that you want to diversify your crop selection in case something happens to the others.

Soybean rust, stinkbugs and weather can all radically change commodity prices mid-season.

Glut, too, can hurt a commodity&8217;s price, Gregg said.

&8220;For some reason, people are sitting on their soybeans from last year, so we&8217;re going to have a big carryover, which could put the whammy on the price,&8221; he said.

The trend towards ethanol, which can be made using corn, could help raise the demand for the crop, Gregg said, but not for this season.

&8220;This country produces 12-14 billion bushels of corn,&8221; he said.

&8220;We export one billion and ethanol might use one billion, so we&8217;re going to have to wait a bit for that.&8221;