Pencil out your budget before jumping into continuous corn
There's more to the economics of continuous corn production than simply cashing in on potentially higher corn prices generated by growing ethanol demand. Growers should take the time to weigh those factors before making any decision to switch production practices.
Barry Ward, an Ohio State University Extension economist, said that taking the plunge into continuous corn production from the standard corn-soybean rotation requires extensive budgeting of challenges growers may face from planting through harvest.
"Higher corn prices have many wondering if planting more corn acres this season might not be a bad idea. But are prices high enough to trigger a switch that will change a grower's crop rotations and have other long-term effects?" says Ward. "The question many growers have to ask themselves is, 'Will corn after corn net more than the more common rotation of soybeans after corn?'"
Ward says there are many economic factors that growers should take into consideration when deciding to rotate into continuous corn production. They include:
- Yield impacts.
Typically, second-year corn yields six to 10% less than first-year corn, and if the crop is not grown in highly productive soil, the yield loss could be even higher.
- Higher nitrogen inputs.
Growers will have to apply more nitrogen to second-year corn because of the nutrients normally made available by soybeans would be lost. Ward estimates that an additional 30 pounds to 40 pounds of nitrogen would be needed in a continuous corn situation.
- Crop protection from insects and diseases.
Growers may be faced with additional fungicide and insecticide costs for rootworm control and disease pressures.
- Management challenges.
"Do farmers have the financial capacity to make the switch?" says Ward. "Corn takes more money upfront to get planted, and takes more time, labor, and equipment to manage than soybeans." Some factors growers should consider include: Increased combine capacity and machinery costs; more manpower and trucking at harvest; and more storage and drying capacity.
- Extra field time.
With continuous corn production, extra field time may be required to scout for insects and diseases.
Despite the management challenges and potential added costs of continuous corn production, some savings exist that support the switch from soybeans to corn, including the lack of chemical applications that may be needed for soybean aphid or soybean rust.
Ward recommends that growers pencil out their costs from operating expenses to production challenges based on their own price, yield and cost projections when deciding to make the switch to continuous corn production.
"Most growers are not taking the big plunge from soybeans straight into corn. Many are just rolling a small percentage of their soybean acreage, five to 25%, into corn production," says Ward. "This year, I think growers are just going to test the waters and see what the results turn out to be. They need to decide if time, dollars and commitment relative to their net return is worth it."