Market News

Ag economist: set aside a year’s worth of land charges

Prospects of a good harvest are putting negative pressure on corn and soybean markets.  Ohio State University ag economist Matt Roberts says he doesn’t believe corn will fall below $2.50 per bushel, but he looks for prices to be close to $3.00.

“That is cash flow positive if you ignore land charges,” said Roberts, speaking the Brownfield At News during the Wyffels Corn Strategies event near Knoxville, Illinois.  “When you include land charges that’s still very unprofitable, so I want to see farmers have at least a year of land charges to be able to weather this storm, because I think we’re going to have two years, roughly, of really low prices.”

Roberts says he’s not surprised by the bearish tone to corn and soybean prices.

Some challenges during the planting season were followed by a couple of months of what Roberts describes as being perfect.

“That is what the market has a hard time looking past is this potential of 170 plus [bushels to the acre] in corn; 44 plus [bushels to the acre] in soybeans, 45 plus maybe even in soybeans,” said Roberts.  “It’s hard for the market to look past that.”

AUDIO: Matt Roberts (5 min. MP3)