Many crop analysts believe, with supporting evidence from the U.S. Department of Agriculture, that farmers may add corn to their rotation at the expense of soybeans.
Chad Hart, a professor in agricultural economics at Iowa State University, said corn is less sensitive to export challenges. Less of it goes to export markets, and it has provided growers with relatively larger cost savings over the past couple of years. Plus, it has seen an upswing in pricing over the past few months.
Hart said growers will also need to consider input costs. While the cost per bushel has been lowered for soybeans because of yield growth, if tariffs with Canada are imposed, that could escalate energy and fertilizer expenses.
Dan O’Brien, a professor and Extension agricultural economist with Kansas State University, said growers will have to consider all options, including selling prices and overall costs.
“Higher diesel and fertilizer costs (should they occur) are likely to have less impact on soybeans enterprise returns that they would on more energy-intensive corn production enterprise budgets,” he said.
O’Brien agrees with the prevailing view that growers are likely to lean toward corn, particularly since market prices have been stronger recently. “We have seen U.S. farmers continue to plant corn acres at higher rates than initially anticipated the last couple of years,” he said.
O’Brien said crop farmers see a managerial advantage with corn, although he believes they are very capable of producing outstanding corn yields, and rotational practices tend to balance or mitigate large acreage swings in the Corn Belt.
Naomi Blohm, a market analyst with Total Farm Marketing by Stewart Peterson, West Bend, Wisconsin, said, “Be ready for anything, and set your price targets now.”
At the regional level, she said producers should watch for local basis levels. “You might be able to scalp nickels that way,” she said.
As they work on their plan, she advises producers to be ready for extreme volatility in 2025.
O’Brien’s advice to farmers is to try to look at as many scenarios as they can in advance of planting. “Have profitability-based soybean price goals thought about ahead of time and challenge themselves to have reasoned, rational pricing goals built into a seasonal risk-based strategy through the pre-harvest and post-harvest time periods.”
O’Brien said trying to anticipate unforeseen market interruptions for the soybean market that can spike or deflate prices is more difficult in 2025.
“We tend to underestimate future market volatility in the grain markets—more so across years than within them,” he said. “So, we manage the risks and opportunities we have for this marketing year and then try to be foresighted enough to not be hurt financially by the coming years.”
Dave Bergmeier can be reached at 620-227-1822 or dbergmeier@hpj.com.
