USDA is preparing to release its March Prospective Plantings report on Wednesday, March 31. While the market may look to bid for acres, Farm Journal Field Agronomist Ken Ferrie says some farmers are switching crop rotations—but their decision isn’t necessarily based on the futures price.
“Based on the phone calls I get, there’s a lot of jockeying going on,” says Ferrie, owner of Crop-Tech Consulting, Heyworth, Ill. “Price has part to do with it, but most of it is crop insurance. With February prices being so high, for the first time since 2012 through 2014, farmers can guarantee a profit.”
The 2021 spring corn crop insurance price was announced at $4.58 per bushel, which is up 18% from 2020, or 70 cents per bushel. The spring price is the highest since 2014, when the spring crop insurance price hit $4.62 per bushel. For soybeans, it’s a similar story, with a 30% increase, at $11.87 per bushel.
“In 2014, you could insure your crop at a high enough price and guarantee a profit,” says Ferrie. “We’re back to those prices now. So, it depends on their APH (actual production history) proven yield. Some of their corn fields are better corn fields, some are better bean fields. So, these guys are jockeying around because the APH will let them log in an insurance profit.”
Ferrie says Crop-Tech Consulting surveyed its customer base earlier this year and found 36% of farmers were looking at changing their crop rotation in 2021.
“This year it’s something else driving the switch,” says Ferrie. “The price is usually high enough to shift you all to beans or shift you all to corn. This year, it’s APH and crop insurance.”
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