I-80 Planting Tour: Economics Drive Western Iowa Farmers to Plant Corn

April 13, 2016 11:30 AM

Jacob Lammert is making room for next year’s crop. He’s preparing to fill the bin again with more corn in 2016.

“We’re doing a lot more corn on corn because that’s where you can make the money this year. It’s pretty tough to cash flow on beans this year,” said Lammert, who farms in Treynor, Iowa.

It’s a decision, focused on potential profits in hopes of a better return. “We’ve always been a 60-40 split, but I bet we’re closer to 70-30 this year,” said Lammert, who doesn't plan on trimming inputs this year.

Lammert has been busy moving grain because he’s had the time. Winds kept him out of the fields longer than he would like. But today he’s planting in some places where the soil temperatures are rising. “We may get the occasional frost that will nip it, but we’re never lost a crop due to frost," Lammert said. "I’ve learned whatever Mother Nature gives us, we’ll get."

A half an hour north, Eric Hough is no longer moving seed. He’s planting it in the field. Even though soil temperatures linger in the low 40s in his area, planting is a gamble he’s willing to take.

“We just need these cold fronts to go away and we need to start warming up,” said Hough, who farms in Underwood, Iowa.  

It’s not the only wager he’s making. He’s planting all of his acres to corn this year. “We’ve at the point where we have higher cash rents," Hough explained. "We haven’t been able to negotiate as much as we want to yet. Taking a look at the economics, we can’t have beans pencil out."

The decision is driven by economics. Even with the inputs, Hough feels corn is his best chance to get higher margins and has shopped around to trim inputs.

“We’ve had some good bean years. Two years ago, we were in the 50s for a yield. Last year, we were in the mid- to upper-50s in beans," Hough said. "Yet, our APH is still down in the mid-40s."

He's not the only one making that decision. Hough is also in the seed business and noted that none of his customers have called to switch acres from corn to beans, even after USDA's higher-than-expected corn acres in the Prospective Plantings report.

Both farmers say diversification is helping with the cash-flow. “We’re close to the ethanol plant. We crack our own high moisture corn. We have a custom hay business we run all summer too. Our inputs are fairly low. We’re lucky there, I guess,” said Lammert.

Hough also relies on several sources of income. “We’re farmer dealers for seed," he said. "We also custom feed cattle."

Those incomes may be necessary, depending on what happens with prices this year. 

Watch the AgDay story below:

I-80 Planting Tour Western Iowa: Economics Drive Corn Planting

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