At the risk of agreeing with The Gulk, I think more of us may be getting some rude surprises as we venture into fields that until recently looked decent, if not lush.
The availability bias is clearly in play here, I admit. But, if his experience matches others in areas that have actually had some rain, but didn't pollinate well, more than the Eastern Corn Belt is corn toast.
And his assessment of a "terrifying corn balance sheet" is not hyperbole, I suspect. I also bow to his undoubtedly clearer thinking: he has crop insurance. I do not.
IL on the whole doesn't do well with CI. Over the long term, we get about 43¢ back from every dollar in premium. But that's for the whole state. When you look at my "darn-near drought-proof*" acres, the payout is even less attractive.
Still, it looks like early planted, early maturing hybrids will make something with three digits. I think we will also see some hybrids with a total FAIL across farms as a result of this year. Which makes seed supply a huge question mark.
But as I thought about it in church this morning, what I think will occur in our professional community will be very similar to a death in the family. Farmers will fluctuate between anger, grief, despair, determination, and courage during a drawn out mourning period. We will know professional embarrassment (This is MY field?) and personal reassessment of how competent we think we are.
It will take time and frankly, rain, to bring closure. So if we're still warm and dry by say, Thanksgiving, I expect some unprecedented decisions and actions. These reactions will impact those around us and along our value chain.
History looks like this. And we are slowly realizing that's what we are writing right now. That's a good thing. If you know it's one for the record books, you want to leave a good account of your own part.
Even if you have to fake it.
*Actual brag from the author. File under: Hubris In Progress
3 comments:
Finished corn silage Friday. Long term COC taking biggest hit-near zero. Glad to be feeding heifers-not fragile dairy cows!
Steve
John where do you think your soys-corn yields will end up? Thinking on our own farms we will be 130 corn and 40 ish soys. On a little trip northwest (about 300 miles) I saw crops not many miles east of me that received 3-5" rain a week ago and then rain this weekend again and our green and excellent. Some drought hit corn along Lake Huron that will be say 75-100. Soys and white beans looked good and would rate crops 80% good to excellent. The winner this year for guys that where not forward contracting is a low yield and 90% crop ins. with floating price which would give guys with trendline yield averages @ market price x 90% of yield over $1,000 acre-regards-kevin
It would seem that despite long-term historical payout ratios, crop insurance would be one of the best ways to "place our bets" on climate change--at least as long as there are subsidized premiums.
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