Dollars count, but let’s be sensible. Crop rotation has benefits that go beyond the bottomline.
University of Illinois agricultural economist Gary Schnitkey says that on average corn returns in his state are more profitable than soybeans. “Between 2006 and 2010, corn-minus-soybean returns averaged $66 per acre in northern Illinois, $50 in central Illinois with high productivity, $45 per acre in central Illinois with low productivity and $59 per acre in southern Illinois,” says Schnitkey.
“We expect those average differences to persist. Until demand conditions change or relative yields change, corn will likely continue to be more profitable in Illinois,” he says.
“However, there is something to rotation that goes beyond what our budgets suggest,” Schnitkey adds. “Our research indicates corn-soybean rotations should be based on factors other than current market conditions.”
As corn acres increase, machinery and power requirements climb. “We’re currently in a period of rapid cost increases and we might be beginning to experience that inflationary environment we’ve been talking about,” he adds. “We don’t see those costs coming down in 2011-2012. Higher overall costs can mitigate the profit advantage of growing corn.”