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Farmers will need to continue to adjust

An ag economist with Purdue University says farmers will have to continue to adjust to tight margins this year.

Chris Hurt says this is the fifth year for the downward trend in farm income.

“And you know that by looking at the price of corn,” he says. “The price of corn for the 2017 crop, the USDA says, is $3.20. That’s the lowest price in eleven years.”

He tells Brownfield historically adjustment periods last 5-7 years, and he expects improvement within the next two years.

“And that improvement is largely coming because of better corn prices anticipated for the 2018 crop and the reason for that is more soybeans will get planted in 2018,” he says. “By the time we get to 2019, Midwest agriculture will be pretty much to a break-even situation.”

In the meantime, he says, farmers should continue to look for ways to lower cost of production without impacting yield.

“Showing landlords your budgets to try to get cash rents to come down even more, could we consolidate some of our land, could we share equipment,” he says.

Hurt says working with ag lenders and lowering capital expenses like equipment or buildings will help.

Audio: Chris Hurt, Purdue University