How Farmers Are Cutting Back in 2016
With corn and soybean prices well below where they have been the past few years, farmers are looking for ways to cut their cost of production. Purdue estimates that seed costs are about 35% of the crop per bushel cost of production, so reducing seed costs is one of the first places producers are cutting. Daniel Call with Seed Consultants says, “We are seeing a lot of producers move to single trait Roundup Ready hybrids. We are also seeing a lot of interest in double stacks.”
Call says one area where producers are opting to cut back is in rootworm protection, “We are definitely seeing some cutback on the rootworm side. As a company, we are seeing rootworm protection traits fall off about 50% from a year ago.”
Call says producers are also taking a closer look at their fertilizer costs, trying to cut back as much as they can without impacting yield, “A lot of guys are taking a look at their P&K rates and figuring that they have been over applying and can cut back and pull some of that out of the soil.” He added that growers are examining all the details of their operation, “They are really fine tuning their crop protection program; some are questioning their use of fungicides and seed treatments.” He added that several years ago many growers did not pay a lot of attention to their cost per acre, but this year they are watching every penny, “They are asking, if they can do without, or drive more profit by not going in a certain direction. A lot of those kind of conversations are being held.”
Call says, while some producers are moving to non GMO hybrids, the switch is not as drastic as once thought. He also told HAT at the Commodity Classic trade show that in Indiana and Ohio more customers were going with corn than soybeans.