Decision Tools for Hauling Grain to Market

Jordan Shockley, Farm Management Specialist, University of Kentucky

Harvest season is upon us and while transporting grain to the market may be the last input cost in the production of grain it is a critical decision a producer has to make, especially when margins are thin. Determining which market to sell your grain (if you have options) can be a complex decision. Most producers, especially in Western Kentucky, have multiple potential markets to deliver their grain. This leads to the question of, “Should I sell my grain to the closest elevator or should I transport it a further distance to an elevator offering a higher price?” What market you choose not only will determine the price you receive but will also determine the cost associated with transportation. The market that provides the highest price is not always the most profitable price. The trade-off between maximizing price per bushel received from the buyer and minimizing transportation costs could be the difference between making a profit that year or being in the red. 

Fall 2015 Wheat Planting Decision

Greg Halich, Extension Economist, University of Kentucky

Kentucky grain farmers have just started harvesting corn and are getting to the point where they will decide how much wheat they will plant this fall. In Kentucky, wheat is almost always planted in the fall following the harvest on corn ground, and then double-cropped with soybeans in early summer after the wheat harvest. This allows for two harvested crops in one calendar year. However, soybeans planted after the wheat harvest are more susceptible to summer drought, which means on average yields are lower for these double-cropped soybeans. In Kentucky, this yield reduction typically averages around 20%. As a consequence, the majority of soybeans planted in Kentucky are full-season plantings rather then double-cropped.

Fall 2011 Wheat Planting Decision

Greg Halich, Extension Economist, University of Kentucky     

(Edited 10/04/11)

Kentucky grain farmers in some parts of the state have been harvesting corn for a few weeks now and they will soon need to decide how much wheat to plant this fall.  In Kentucky, wheat is almost always planted in the fall following harvest on corn ground, and then double-cropped with soybeans in early summer after the wheat harvest.  This allows for two crops in one year.  However, soybeans planted after the wheat harvest are more susceptible to summer drought, so on average, yields are lower for these double-cropped soybeans.  In Kentucky, this yield reduction typically averages around 20%, but in many years there will be no yield difference due to weather.

Profitability Analysis of Late Planted Corn Compared to Soybeans

Greg Halich, Department of Agricultural Economics, University of Kentucky

May 2, 2011

Background:
Although new-crop corn and soybean prices are near record highs, planting conditions remain terrible throughout Kentucky as of early May 2011.  It is estimated that only around 5% of the corn crop has been planted.  Grain farmers throughout the state are now worrying whether they will get their crops out in a timely manner this year.  An associated question being asked is at what point should they stop planting corn and switch to soybeans?  In order to answer this question, we need to estimate potential yield losses for late planted corn and compare the associated profitability against soybeans.

Corn and Soybean Profitability 2011

Corn and Soybean Projected Profitability 2011
March 22, 2011
Greg Halich
Department of Agricultural Economics
University of Kentucky
859-257-8841
Greg.Halich@uky.edu

Corn and Soybean New Crop Price Estimates for 2011 (Based on CME 3/22/11 Closing)
Scenario:	Corn	Soybeans
Low	$4.75	$10.75
Baseline	$5.75	$13.00
High	$6.75	$15.25

Input w/Greatest Impact on Profit?
Fertilizer Cost.
→ Let’s look at fertilizer prices.

Average Crop Revenue Election (ACRE) Program

In the 2008 Farm Bill the United States Department of Agriculture (USDA) released a new provision called Average Crop Revenue Election (ACRE) program. Beginning with the 2009 crop yearproducers will have the choice, before or on August 14, whether or not to enroll in the ACRE program. Selecting to participate is made by farm number (hereafter referred to as a “farm”) and everyone involved (i.e., tenant, landlord, etc. ) must agree to sign up. Participating in ACRE will result in reducing direct payments by 20 percent, marketing loan rates by 30 percent, and forgoing any counter-cyclical program payments. When a farm elects to participate in ACRE that farm will be required to continue in the ACRE program over the life of the 2008 Farm Bill (2009-2012). Additionally, any farm not involved in ACRE can elect to participate for the following crop year at any time over the life of the 2008 Farm Bill. By enrolling a farm into ACRE the producer enrolls all eligible crops on that farm in ACRE. The USDA will not make any ACRE payments before the end of the crop year. To sign up in ACRE producers must elect ACRE then annually enroll in ACRE. Electing to participate but not enrolling results in forgoing any ACRE payments. The timing of ACRE payments will be made beginning October 1 or as soon as possible after end of marketing year.

For more information on how the ACRE program works and access to the online University of Kentucky ACRE calculator please visit : http://www.ca.uky.edu/agecon/index.php?p=110