Welcome to the updates section of Stalcup Agricultural Service. Feel free to look around and find out some of the interesting things happening in our area |
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Below you will find our latest newsletter, along with some past issues for reading. Also you may follow the links to the left for the latest weather, news, and headlines.
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Fall 2011:
Corn Belt agriculture is experiencing some of the most interesting times in its history. Volatile markets, world economics, cheap interest rates, record profit margins, competition for additional land, and a solid agricultural economy all add up to opportunities for landowners. Landowners need to understand the current economics of production agriculture. We’ve rapidly advanced from top end yield potential of 160...
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Summer 2011:
Starting with the USDA crop report on June 30, 2010, grain markets have moved mostly higher, peaking in early June on weather related planting delays. Since then, global financial concerns and a surprising (and somewhat suspect) USDA acreage report estimating higher corn acres to be harvested this fall have taken the markets off their highs. We are still at very high historical price levels, however, with prices at the time of this writing for fall 2011 delivery in the mid $6.00 per bushel range for corn and the over $13.00 per bushel range for soybeans. Moreover, bids offered for fall 2012 are also near those levels. These prices are critical as it will determine how to structure farm leases going into 2012.
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Spring 2011:
Our fall newsletter commented on rising land values with several sales in the $7,000’s and even as high as $9,575 per acre. That turned out to be only the beginning of one of the strongest surges in land values in recent memory.
As corn and soybean prices rose this fall in response to strong global demand coupled with short crops in some growing regions, the land market followed suit. As has been widely reported in the press, an 80-acre parcel south of Sioux Center sold at auction in November for $13,950 per acre. That was one of those outlier sales that occasionally occur when a choice parcel is offered at auction. The right competitive factors were in play for a headlinemaking result.
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Fall 2010:
Events in crop-growing regions
around the globe have conspired
since mid-summer to push corn and
soybean markets higher in historic
fashion. Let’s review – the 2009
harvest brought in record production
in many areas, but harvest was late, at
high moisture with low test weights
and generally below-average quality.
Despite lots of bushels, there was
some belief that this crop would
disappear quickly due to quality
issues. As one ethanol producer
commented, “We buy bushels but
grind pounds”.
However, the USDA Crop
Production Report of January 12th...
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Summer 2010:
We are halfway through the 2010 crop year. It is time to start reviewing current lease terms and making
decisions for 2011. These decisions may include adjusting cash rental
rates.
Cash Rent Factors for 2011....
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Spring 2010:
Cold and snowy have been the themes for the winter of 2009/2010. The severity of the cold and snow were recently highlighted by the Iowa State Climatologist. For the three months of December, January, and February, the state averaged 4.5 degrees below normal, making it the nineteenth coldest winter in 138 years. Snowfall averaged 45.1 inches, 23.1 inches above normal, making this the snowiest December-February season in Iowa history. We here in Northwest Iowa have seen more snow than anywhere in the state at approximately 65 inches. With 90 plus consecutive days below 40 degrees, very little snow had melted by early March. It has been a challenge this winter to move stored grain to town and in some cases even to access bins to monitor grain conditions. Heavy snow has caused numerous roof collapses to farm buildings and made feeding and taking care of livestock difficult.
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Fall 2009:
A number of factors go into making a profitable farm operation. Improved seed genetics have increased yields over time. Improvements in the land itself and how it is operated also play an important part. When these factors are put together, it is gratifying to both owner and manager to seesuccessful results.
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Summer 2009:
It is that time of year to start thinking about what changes you want to make to your current lease. Iowa’s lease termination deadline is September 1st. Now is the time to review your current arrangement to make sure you are getting the return you deserve for your farmland asset. Cash rents have increased significantly the past four years. Depending when you last negotiated your cash rent terms, you may be entitled to an increase. The high grain prices of summer
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Spring 2009:
The last six months have been a reminder that the agricultural economy is still tied to the health of the U.S. and global economy. After a very good run of grain prices stretching back to the fall of 2006 and peaking in July of 2008, we have seen significant drops as the worst recession since the 1930’s has affected virtually all areas of the economy. Not all the news is bad, however. Oil prices have begun to stabilize, which bodes well for our bio-fuels industry. There are a few small signs of an economic recovery. As the federal stimulus money begins to flow, inflation may increase whichwill support commodity prices.
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Fall 2008:
As of this writing (October 13th), land sales in our trade area have held up well despite the world-wide decomposition of equity markets over the past month that have brought commodities along for the downhill ride. Since this is typically the busiest time of year for land auctions, the farmland market is being tested several times in the region on most days. There will be variations from area to area, as always. Low quality farms would be the first affected by any decline in value.
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Summer 2008:
Those owners willing to participate in crop production have been rewarded with high grain prices. Returns from custom farming have been the highest of any operating alternative each of the last twenty-five years. Even in poor production years, returns have exceeded those of 50-50 crop share and average cash rent.
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Spring 2008:
The market for farmland in Iowa (and the U.S. in general) continues upward at a strong pace. Recent land value surveys give an indication of the magnitude of the upswing; however, the real evidence is the land auction results that have occurred over the past six months. As corn has moved up by nearly $2.00 per bushel and beans by nearly $4.00 per bushel since early last fall, so has the land market stepped up the pace...
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Fall 2007:
There is no doubt that the biggest news in agriculture over the last few years has been the rapid increase in ethanol production. Revolutionary might not be too strong of a word for the changes we have witnessed - a rapid run-up first in corn prices followed by wheat and soybeans, the largest acreage planted to corn since World War II, and an increase in land prices and rental rates fueled by improved earnings.
Summer 2007:
The sizeable increase in corn and soybean prices since last
fall will have a substantial impact on 2008 lease terms. Landowners should analyze their current lease terms or new operating alternatives to be sure they realize the full advantage of this dramatic increase in income. Below are brief descriptions of various lease types to review as you consider alternatives to meet your goals:
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Spring 2007:
The rapid rise of corn and soybean prices with about a $2.00 per bushel increase in both corn and soybeans since the beginning of the 2006 harvest season will have a substantial impact on lease terms. Per acre gross income will likely increase $200 or more per acre on a farm rotated between corn and soybeans when compared to the last few years.
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