SALEM, Ohio – Give all the credit to the ethanol boom.
There are more than 110 ethanol biorefineries up and running nationwide, and about 75 more coming down the line. But to make it all work, those factories need corn, and lots of it.
Calculating with USDA’s figures, the extra demand expected from ethanol refineries in 2007 means U.S. farmers need to plant an extra 6.5 million acres of corn in the spring.
Those acres have got to come from somewhere, and it’s likely farmers will butt in on the traditional corn-soybean rotation to fill corn contracts.
Isn’t easy. Current and new crop 2007 corn prices are hovering around $3.75 per bushel at elevators in the region, making it mighty tempting to skip a few steps in the crop rotation and plant corn again in the spring.
Economists and agronomists alike warn the decision to break rotation isn’t as easy as adding more bags of seed corn to the order and crossing off the soybean tally.
There’s more to think about than harvest.
Interruption. Barry Ward, an Ohio State University Extension economist, said taking the plunge into continuous corn production from the standard corn-soybean rotation requires extensive budgeting of challenges growers may face, from planting through harvest.
“Higher corn prices have many wondering if planting more corn acres this season might not be a bad idea. But are prices high enough to trigger a switch that will change a grower’s crop rotations and have other long-term effects?” said Ward.
“The question many growers have to ask themselves is, ‘Will corn after corn net more than the more common rotation of soybeans after corn?'”
Run the numbers. Gregory Roth, a Penn State crop and soil scientist, says now is the time to run the numbers on a partial budget analysis to see how the corn-soy switch might play out.
Even if a farmer switches all his soybean acreage to corn, he may fall farther behind budget-wise than following his normal rotation, Roth suggested.
“It seems the farms that have [fields with] high corn yield potential and good soybean production are better candidates [for the switch] than farms with medium corn and pretty good soybean production,” Roth said.
Your own data. Ward recommends growers pencil out their costs – from operating expenses to production challenges based on their own price, yield and cost projections – when deciding to make the switch to continuous corn production.
“Most growers are not taking the big plunge from soybeans straight into corn. Many are just rolling a small percentage of their soybean acreage, 5 percent to 25 percent, into corn production,” said Ward.
“This year, I think growers are just going to test the waters and see what the results turn out to be. They need to decide if time, dollars and commitment relative to their net return is worth it.”
(Reporter Andrea Myers welcomes reader feedback by phone at 800-837-3419 or by e-mail at email@example.com.)
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