Tuesday, December 18, 2007

Cash Grain Prices Likely to Remain High for 2008 and Perhaps Beyond

The trend towards higher cash grain prices is likely to remain into 2008 and the years beyond according to University of Illinois Ag Economist Darrel Good:

“At some point, you wonder if there’s just not enough acreage to do all that we might need to do,” said Darrel Good, a professor of agricultural economics at the University of Illinois.

The reports came Monday as wheat hit a record $10.095 a bushel on the Chicago Board of Trade before falling back to $9.68. Corn and soybeans also continued to trade at historic highs of nearly $4.39 a bushel for March corn and nearly $11.57 for January beans.

Good said demand for grain as food and fuel continues to drive prices, and there are no signs the trends will reverse in 2008. In fact, most forecasts are for continued high prices beyond next year.

A report was released by the University of Illinois estimating yields in various crop rotation scenarios for 2008:

The outlook for ’08

Estimates of 2008 revenue and non-land costs for corn and soybeans (per acre, prime farmland).

Central Illinois

  • Corn after soybeans: Revenue, $753; costs, $357; return, $396.
  • Corn after corn: Revenue, $715; costs, $371; return, $344.
  • Soybeans after two-year corn: Revenue, $545; costs, $216; return, $329.
  • Soybeans after corn: Revenue, $527; costs, $215; revenue, $312.

  • Source: Springfield State Journal-Register Online

    No comments: