Last year, North Carolina corn growers shattered an all-time yield record averaging 142 bushels per acre. Virginia and South Carolina produced big crops despite weather-related problems. Growers likely will need to stay on that high-yield trend to make corn profitable in the coming years.
Virginia corn growers averaged 145 bushels per acre last year. The 29 percent increase in corn production in Virginia mirrors the national increase of 28 percent over the 2012 crop. Corn acreage was up 5 percent to 345,000 acres in South Carolina. Historic rainfall in the southern end of the state kept statewide yields down slightly from the record shattering 2012 crop.
“Last year was a big year for corn in North Carolina,” says North Carolina State University corn specialist Ronnie Heiniger. “Most of our farmers made a profit on corn and we provided an extra 68 million bushels of corn for our livestock industry.”
North Carolina corn producers planted a near-record 870,000 acres last year. Increased acreage, yield and price provided an all-time record value for the 2013 crop.
However, the limiting factor for corn acreage in the Upper Southeast won’t likely be the weather in 2014. It will be lower corn prices.
“Last year we broke a record with 142 bushels per acre, and at $7 a bushel, most growers made a good profit. However, with the cost of corn production continually going higher, if a grower produces 142 bushels per acre in 2014, they will need to have corn prices of $4.78 a bushel just to break even,” Heiniger said.
Minus land costs, it takes about $500 per acre to grow corn in North Carolina. Dave Fogel, vice-president of Advance Trading, speaking at the North Carolina All Commodities Conference, says he doesn’t see much change in corn price up or down from the $4.50 to $5 range for the next few months.
If such price projections prove accurate, Virginia-Carolina corn producers will have to ramp up yield to stay profitable. There is no doubt that there are significant differences in planning a corn crop that sells for $7 per bushel versus one that sells for less than $5 per bushel.
Maintaining a good rotation and other production factors have to be considered, but Heiniger contends growers who don’t feel confident they can grow more than 100 bushels of corn per acre should probably look at growing other crops.
Price and corn acreage will likely be closely calculated right up until planting time. If the price goes up, so will corn acreage most likely. If the price stays in the $5-per-bushel range, corn acres will likely remain close to 2013 levels, with some decrease. If corn prices dip very far into the $4, corn acreage could drop significantly across the Upper Southeast.
Making corn profitable at $2.80 per bushel
For the past few years, Heiniger has conducted research to look at return on investment of various corn inputs. By increasing seeding rates and using drought-tolerant seed, using a starter fertilizer, applying a fungicide at the V-5 growth stage and a few other tweaks to a conventional corn program, he produces an average of 220 bushels per acre across several tests conducted throughout the state.
He notes that a corn yield of 220 bushels per acre under this production scenario would only require a corn price of $2.80 a bushel to break even.
Growers can reduce risks on some land that is prone to drought by using drought-tolerant seed. These hybrids aren’t typically among the higher-yielding varieties, which under some weather scenarios can actually increase risk.
Seed rate, he says, is a make or break decision across most of the corn-producing areas of North Carolina. On $270 a bag corn seed, upping the seeding rate from 33,000 to 43,000 per acre requires a 7.5 bushel per acre yield increase, at $5 per bushel prices, to break even.
In virtually all of the North Carolina test sites, increasing seeding rate paid off last year, Heiniger notes. “I’m confident, on most land, I can get enough yield increase from increased seeding rates to make it profitably,’ he says.
Starter fertilizer can reduce risks and was successful in several cases in producing a positive return on investment. Using 5 gallons of 3-18-18 fertilizer, applied in a 2X2 band, the N.C. State researcher says a grower will need 5.5 bushels per acre to break even.
Using seed treatments paid off in in 24 of 48 test sites in the North Carolina tests. Likewise, using a fungicide on corn at the V-5 stage proved beneficial in 18 of 48 test sites. Breakeven for fungicide use was 3.1 bushels per acre, he notes.
“Our research with fungicides stresses the importance of choosing hybrids wisely to coincide with other production choices, because we got different results across the state, using different varieties,” Heiniger concludes.
Heiniger says the best is yet to come for corn production in the region.
“Last year we had too much rain statewide, and we had record rainfall in some areas of the state that historically produce the highest corn yields,” he stresses.
“Perhaps more damaging than the excessive rainfall, we had prolonged periods of cool, cloudy weather that restricted light interception and reduce the plant’s ability to store energy. None of these things are typically conducive to high corn yields,” Heiniger said.
The N.C. State corn expert is also widely followed for his tracking of global weather patterns and often spot-on predictions of weather trends for North Carolina.
He says the region will likely remain in a neutral pattern, between a La Nina and an El Nino, which means similar weather this growing season to last growing season.
“I expect colder-than-normal weather from January through March. I think we will have a break in April and May—time to get corn planted,” he said. “The rain will likely return in April and May, but hopefully not in 100-year record totals like we got in some parts of the region last year. Then, if this pattern holds, we will likely see more traditional heat and dry weather in July and August.”