It is slowly dawning on those who would adjust the marketplace by law that they need to have a firmer picture of what winning looks like. I received this e-mail yesterday.
Your association needs your help. We need you to consider planting more corn this season. Based on the recent USDA Planting Intentions report, the market needs more corn than currently planned.
As a farmer, I know input costs are higher for corn than soybeans, and I know that with all the corn last year, it is easier to plant soybeans into stalk ground and slip back into that soybean after corn rotation. The problem is our markets need more corn. Livestock continues to need more corn, exports continue to need more corn and even the ethanol industry is continuing to grow, albeit more slowly. Unless we, as farmers, can collectively grow more corn, we will never silence our critics who claim we are causing everything from increasing food prices to the deforestation of the Amazon and creation of more Global Warming. What is more, we will choke off demand as we finally are breaking free of the shackles of Government Farm Programs.
So as we wait to get into the fields this spring, please seriously consider shifting one more field back to corn.
Thank you for your consideration.
President, Illinois Corn Growers
Don't get me wrong - I support Art's effort. But has it struck anybody what an unusual missive this is? Corn prices are at record levels, and we literally begging for more acres.
It is not difficult to imagine $7 corn today. In fact, I can come close now with some non-GMO corn contracts. But even the most avid ethanol booster has to be surprised by how the corn grower windfall is playing out.
One glance at the financial reports of the seed, fertilizer and machinery industries demonstrates that we can't make money fast enough to cope with their pricing power. Even faster to react to profits we are temporarily booking are landowners. This is the reason - although I sure didn't see these kinds of numbers coming - why I advocate passionately the ownership of land. Only by capturing the return to land along with the return to operation can farmers withstand the economic power of vendors.
The hog industry is about to see a tsunami of red ink, I think. To be sure, they show no sign of backing off, but as we saw in the grain industry, the breakdown will be abrupt and enormous. While corn growers cite studies showing cornflakes aren't going up because of corn prices, even they can't disguise the nearly 50% contribution of feed to meat costs. Consider just briefly what a modest increase in the dollar would do as to export demand, if those worries aren't sufficient.
We've just about taken all our customers - including our treasured ethanol plants - to the brink. And Art is right. If we don't grow enough corn and get prices below current levels at least, we face a demand devastation. I realize this is frantic searching for a cloud behind our silver-lining, but I really don't want to know what $7 corn will do to the beef herd or Congressional temperament.
Only our predicament won't be caused by mean-spirited "critics". It will arise because we corn farmers made promises we could not keep.