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Break-evens a moving target as input costs and commodity prices weaken

Margins are tricky for many growers as input costs and commodity prices trend lower.

Kent Thiesse is a farm management analyst based in southern Minnesota and says the price environment is changing.

“We’re living in a $7 corn world and we’re in a $5 reality.”

He tells Brownfield cash prices for old crop remain in the $6 to $7 dollar range, but new crop is down in the low $5’s.

“When you start plugging in a $5.25 number instead of a $6.50 number on your break-evens, things get a lot tighter. Especially if you’ve got some higher cash rental rates and you did have some higher input costs, it could get a little challenging.”

Thiesse says fertilizer prices have fallen about 40 percent since last spring, but most farmers locked in purchases before the drop.

Thiesse made these comments during Brownfield New Ulm, Minnesota affiliate KNUJ’s Farm Forum last week.