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• With few exceptions, the 2012 crop in the Southeast will be the most valuable crop to buy and the most expensive crop to produce on record.
COTTON ACRES are down, and prices are not great, but the Southeast should produce a good crop this year.
Corn growers did well
Corn growers clearly will do well. Dryland corn in the 80-90 bushel per acre range was common across much of the Southeast and that means profit.
Irrigated corn yields in excess of 150 bushels per acre was common and more than 200 bushels per acre not uncommon — that too means profit.
Double-cropped soybeans behind 70-80 bushel per acre wheat will no doubt produce the highest dollar revenues, but profitability will depend on a number of variables.
Total dollars generated by 70 bushel per acre wheat, followed by 30-40 bushel per acre beans will push per acre income and more importantly per acre profit above most any single-season crop. Many growers will likely produce significantly higher yields of both crops.
Two bale cotton, even for growers who were able to market half of their crop in the 90 cent per pound range and half at 70 cents a pound will only pull $800 or so per acre. Two bale per acre cotton will be hard to come by in most of the Southeast this year as will averaging 80 cents a pound for the crop.
The peanut crop should be good, with Southeast and Virginia-Carolina belts combined likely to average in the 3,500-3,800 pound range. The scary part of the peanut equation is that reportedly about half the crop in Georgia was grown without a contract.
If so, that could leave plenty of growers holding peanuts valued at considerably less than the $700 per ton contract prices offered to some growers.
Nationwide, some contend corn will be the overall big winner, despite the horrendous heat and drought problems faced by growers in the Midwest this year.
As one Nebraska grower so aptly put it, “Corn dies really well out here.”
According to recent USDA information, the price of corn has jumped by 50 percent from mid-September last year, which some say will more than make-up for yield losses attributed to the record heat and drought.
The USDA has projected that output will fall only about 15 percent from 2011, which is not a drastic enough decline to offset the growth from the price gains. As such, the heightened price of corn will help America’s corn farmers.
IBISWorld, which claims to be the largest producer of industry information in the world, projects that the risk score for the Corn Farming Industry (IBISWorld report 11115) will decline from 5.34 in 2012 to 4.07 in 2013 as the price of corn increases.
The same reports says, “Higher corn prices will increase the demand for soybeans, causing these farmers to either plant more crops or sell their existing product at higher prices. This translates to higher revenue and a lower risk score for the soybean farming industry.