- Mark as New
- Bookmark
- Subscribe
- Subscribe to RSS Feed
- Permalink
- Email to a Friend
- Report Inappropriate Content
Everything is relative
- Mark as New
- Bookmark
- Subscribe
- Subscribe to RSS Feed
- Permalink
- Email to a Friend
- Report Inappropriate Content
Re: Everything is relative
Glad to know maybe some one else sees this problem the same way that I do.The answer to high grains is NO.Look at the cost of new tires on a tractor,new combines of $300,000 and in terms of gallon priced diesel,near $4.00. Wheat for example hit over $6.00 at our terminal in 1974,off road diesel was probably around 40-45 cents a gallon with urea46% around maybe $130 a ton. Do the math on every thing metioned and to equal that 1974 high of $6.00 a high today would be $24.00 plus.No grains realy are not that high!
- Mark as New
- Bookmark
- Subscribe
- Subscribe to RSS Feed
- Permalink
- Email to a Friend
- Report Inappropriate Content
Re: Everything is relative
I completely agree. All the talk is on big margins for corn and soy on prime corn belt ground, but for those of us on the margins growing say, wheat or barley, it's a different story. It's a significant point that this market needs all of our production to meet demand now. Margins for some of us are razer thin or non existent, we can't stand any drop off in price from here and still keep up with inputs. I'm glad you brought this topic up.
- Mark as New
- Bookmark
- Subscribe
- Subscribe to RSS Feed
- Permalink
- Email to a Friend
- Report Inappropriate Content
Re: Recent prices in grain
have created demand for crop imputs. Those folks selling those items are well aware of the increased demand and are harvesting their profits.
They sell to the folks that will pay foritand they don't much care if you make a profit or not. You have been blessed with increased demand for what you produce. Crop imput suppliers have been blessed the same way. Profitable farmers buying their products.
Their productions cast are like your crop costs in that they have little to do with their selling prices. There prices are reflecting what the market will bear.
- Mark as New
- Bookmark
- Subscribe
- Subscribe to RSS Feed
- Permalink
- Email to a Friend
- Report Inappropriate Content
Re: Recent prices in grain
Until one farmer (or corporation) controls all the land farmers will not actually be setting the price they sell for. Input providers establish their prices based on what they think the market will bear and we blindly accept and pay their price. I cannot alone boycott a supplier and expect him to lower his price. I have and will cut back on some inputs even if it means sacrificing a little yield. Will you?
- Mark as New
- Bookmark
- Subscribe
- Subscribe to RSS Feed
- Permalink
- Email to a Friend
- Report Inappropriate Content
Re: Everything is relative
Growers simply need to look at real margins in their opperations rather than price. I farm in an area where we produce specialty commodities and for instance a crop that would occasionaly bring say 90 cents a pound in the 80s and 90s . Now when the same crop is around 90. cents,once in a while I will hear a grower say some thing like this,we have always be pretty happy whith 90 cents.Our ag college says break even on this commoditie is 92 cents,and that was last figured when off road deisel was $2.40 per gallon,go figure.The market will pay higher if the growers would hold but their seems to be some kind of satisfaction in being the first one rid of his crop.I think some of these folks just feel helpless!
- Mark as New
- Bookmark
- Subscribe
- Subscribe to RSS Feed
- Permalink
- Email to a Friend
- Report Inappropriate Content
Re: Everything is relative
http://www.farmdoc.illinois.edu/manage/index.asp
As far as cornbelt economics go, I think the U of I crop budget spreadsheets are pretty good. Low productivity Central Illinois hits Central Indiana pretty close and you can tweak your own numbers into it.
Still pretty profitable although no longer a 6 inch putt like in the early years of the boom. But a whole, whole lot of money on the table.
I can remember that for most of the years from say 1981-2005 you could run a crop budget and conclude that you had to beat the average by a little on all counts (price, input cost, yield) in order to make money on that marginal acre that the budget represented.
So in my mind this is a whole lot better although a multi-year period where pries are substantially below present, couple with any sub-par production, will result in some equity bleed for a lot of producers.
- Mark as New
- Bookmark
- Subscribe
- Subscribe to RSS Feed
- Permalink
- Email to a Friend
- Report Inappropriate Content