America’s corn farmers are already planning what they’ll plant – and what they won’t. Farmers were told last week that U.S. stockpiles of corn are up – way up – and they might want to think about planting something else next year.
Keith Alverson, a sixth generation ethanol corn farmer in Chester, South Dakota, says it’s all about supply and demand. Corn prices were up last year thanks to two years of drought that lowered supplies. That meant farmers, like Alverson, planted more acres of corn. Those acres flourished -- the weather was favorable and the harvest was larger than it had been in previous years.
Alverson says the downside of the good harvest and higher supply is that corn prices have dropped 14 percent over the last few months.
“Think of any of our budgets across the United States: If we have a 14 percent decline of what’s coming in, yeah, it can definitely have an impact,” Alverson said.
Now, he’s making plans for spring and what he’ll plant on his 2500 acres. Many of his neighbors and fellow farmers will plant a 50/50 mix of corn and soybeans, because the profits for the two are about equal. That wasn’t case last year when corn was much more lucrative.
Does that mean no corn crop in 2014? Alverson says no.
“I’ve got a soft spot in my heart for corn, no doubt about that. I enjoy growing it, it’s a fun crop to grow. That being said, there’s economics involved too."