Corn prices over $4 per bushel aren't too unusual, but corn prices over $4 a bushel for several years would be historic. Whether or not high prices equate to high profits remains to be seen.
Though it's too early to know exactly how many acres of corn will go into production in the Southeast, it is a good bet that every state will show some increase in acreage. It is an equally good bet that most of the new corn land will come from cotton, though soybeans, peanuts and tobacco will likely share the loss.
Dan Davidson, an agronomist with DTN in Omaha, Neb., and a long-time corn and grain farmer has some hard earned advice for growers in the Southeast who will be growing corn for the first time, or for the first time in a long time.
Traditional Southeastern crops, like cotton, peanuts and tobacco have a different nutrient requirement than corn. So, the first thing Davidson suggests for growers switching to corn is to get fertility right. Then, getting the plant population right — it may be 24,000 in one area and 34,000 plants per acre in another. And, how early can corn be planted in the Southeast? All these are basic, but critical questions for new corn growers to consider.
More so than in cotton, for example, corn should be planted at a uniform depth, usually two inches and plants should be spaced 5-7 inches apart. The field should look like a picket fence of corn stalks. This requires every seed be in the right place and right depth, because late germinating seed will not produce well.
Unlike cotton, peanuts and other more determinant crops, corn will not adjust very well to spacing and those plants left behind will stay behind.
The tremendous interest in corn, spiked by the high prices being contracted well into 2008, has influenced many growers in the Southeast to invest in corn growing equipment. The need to recoup those costs while corn value is high may influence some growers to grow corn behind corn. Though not ideal, from a rotation standpoint, Davidson says continuous corn could be profitable for growers in the Southeast.
Davidson says the trend in the Midwest will continue to move toward growing corn after corn. The push by ethanol plants for more corn, and the limited acreage for corn production nationwide will mandate this to happen. And, he says, corn after corn is not necessarily a bad thing.
“We have been told results of small plot studies at various universities that growers will see a 10-15 percent, or higher, loss of yield when growing corn two or more years on the same ground. “I've grown corn after corn for many years, and I've talked to dozens of farmers who have done so, and the yield drag is just not there,” Davidson says.
“I think we make growing corn harder than it needs to be. With today's technology, there is no reason to lose yields, if the grower takes care of other production practices,” Davidson says.
If you look at the top 10 things corn growers need to do to avoid yield losses on continuous corn, eight of these things are routinely done by corn growers, regardless of their rotation, he contends. On that list are production practices like using seed treatments for insect control, using Bt corn, increased nitrogen, herbicide tolerant seed — top corn producers already do these things.
“To me that means the step to growing continuous corn profitably is much shorter than anybody thought,” Davidson stresses.
The key issue to growing continuous corn, he contends, is how you manage the residue left after corn harvest. The bed into which you plant corn after corn is similar to planting corn after cotton or peanuts. The seedbed has to be firm and has to allow planting corn evenly spaced and at the right depth. These are critical issues in attaining high corn yields, according to the agronomist.
When corn is combined the previous year, it is critical to chop stalks with the corn head, using knife rollers to make sure residue is evenly spread out across the field. Then, in some areas shredding stalks into smaller pieces is a good idea. Then come back in the fall and do some type disk ripper or chisel to get some of the residue buried.
Finally, there must be some type row cleaner or trash ripper to make sure the residue is cleaned from the row. Otherwise, there will be uneven seed placement, and many of these seeds won't germinate.
When growing corn after corn, growers will have to up nitrogen rates by 30-50 pounds per acre. If nitrogen costs 40 cents a pound, and 50 pounds is an extra $20 per acre, it may not look too good when corn is selling at $2.80 per bushel. At $4.20 per bushel, the extra 10-15 percent yield easily pays for the extra nitrogen, plus adding to the overall profitability of the crop, Davidson says.
The extra steps it takes to grow corn behind corn may cost a grower $40-50 acre, but making yields comparable to corn in a two, three or four year rotation is well worth it when corn sells at these high prices we are seeing today, he adds.
“The growers I have talked to who do the best job of using continuous corn don't plant it everywhere. They still practice two or three year rotations on some land. They plant continuous corn in fields with the best fertility and water-holding capacity. Those yields will usually be comparable to yields in fields that are in rotation with other crops,” Davidson says.
In the Southeast, Davidson says, disease problems will be more severe in continuous corn than in dryer, more arid regions of the country. However, using Bt corn to prevent access points for disease to enter will help lessen disease problems. Though many Southeastern growers have gotten away from tillage, turning corn residue under will also reduce sites where disease organisms can grow, and generally lessen disease pressure.
It is likely the high price of corn will create interest in using preventative fungicides to manage leaf diseases. Whether adding an extra $20 per acre to corn production is beneficial may come down to yield potential of the crop and history of diseases in a particular field.
As in every other aspect of growing crops, careful monitoring of environmental conditions and managing pesticide use are essential to making profitable management decisions.
The increase in corn acreage has created a demand for more corn seed. Davidson says there may be a shortage of some varieties with triple stacked traits and other special protection traits. But, winter production of corn seed in South America will insure overall seed supply will be adequate.
While lack of corn seed may not be an issue for the 2007 crop, the shortage of Bt-stacked varieties can directly affect high yields and high profits. Identifying the variety best suited to a particular farm may not be as big an issue as finding seed in that particular variety. So, on the one hand there is not likely to be a shortage of corn seed, while shortages of some varieties in some areas of the country could be significant.
In the Southeast, where corn acreage is expected to see a big jump, lack of a particular seed may be a bigger problem. The South is not traditionally a high corn producing area, so varieties adapted to growing conditions here may be among the sporadic shortages for 2007.
Overall, high corn prices will likely be good for farmers in the Southeast. Whether it will be an economic boon, as some predict, remains to be seen. For first time corn growers or those out of corn for many years, Davidson suggests getting modern, high tech-based information and to treat corn as a primary crop with high profit potential.