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Treat your soybeans like the crop they are

Agriculture.com Staff 09/02/2009 @ 2:20pm

Detractors of soybeans call them a corn cover crop. An intermission crop. Or even a weed.

Treating soybeans this way becomes a self-fulfilling prophesy. Still, Cory Sinn, Trimont, Minnesota, found something interesting when reviewing his long-term records.

He made more profits from soybeans than from corn.

"On a five-year average, my net return was $23 per acre more for soybeans than for corn," says Sinn.

Granted, Sinn buffers soybeans between corn in a corn-corn-soybean rotation over his 320 acres. This creates a better soybean environment by helping to break pest cycles.

An agronomic program that stresses a good seedbed, adequate drainage, and soil fertility play a part. Sinn, his wife, Cara, and sons Ean, 11, and Evan, 8, have their own separate farmland. And Sinn has a machinery-sharing agreement with his father, Jim; his uncle, Dean; and cousins Ryan and Jeff, that significantly slices machinery costs.

Preseason meetings Sinn has with Larry Griffin, his Southwest Minnesota Farm Business Management Association (SWMFBMA) instructor, also are key.

"He has rock-solid numbers that let me know where I stand," says Sinn.

Sinn, who grew up in the area, returned in 1997 to take a crop consultant position with United Ag-Tech in Trimont. In 2001, he bought a farm from a neighbor and rented more land in 2002.

His family's understanding that he'll be busy during certain times of the year has also enabled him to work as a crop consultant. Besides bringing in off-farm income, relationships he's formed have enabled him to better buy inputs for him and his family.

"It also lets me keep a good eye on input costs and production practices that work and don't work," he says. "Being in this business has helped me see that not every sales gimmick will make $10 or $15 or $20 per acre."

When Sinn began farming, one loan requirement was that he enroll in an adult farm-management program. "The first time I went over my balance sheet, having a negative net worth was scary," says Sinn.

But he has worked his way up the financial ladder. Sinn roughly aims for a return on investment of 20% on his soybeans. "Any business that maintains that level of profitability will be in good shape," he says.

"Larry and I build a budget each year using fairly conservative numbers yieldwise," he adds. "The numbers I get from Larry are absolute numbers as to what to put into the crop, what breakevens are, and what I need for living expenses."

On the surface, soybeans may seem to have lower costs than other crops when it comes to seed, chemicals, rent and machinery. However, the farm business numbers track all he does and allocate expenses to each crop. These include ones often left out, such as family living expenses.

These numbers also help him base the level of crop insurance he needs. During the past two years, he's insured his soybeans with revenue assurance at 70% or 75% levels.

"This gives me a base from which to start marketing the crop," he says. "I try and make marketing decisions based on those yields where we get a $40- to $50-per-acre profit."

Anything above that is extra money that Sinn can use where he chooses.

This year, Sinn has forward-priced about 60% of expected soybean production. Forward-pricing doesn't always garner the highest price. There have been times in recent years where prices climbed into the growing season. In 2009, though, more normal price patterns have occurred when soybean prices spiked on planting concerns in late spring.

Sinn uses his expertise as an agronomist in his farming operation, too. Over the past five years, he's had an average yield of 53 bushels per acre, above the 48-bushel-per-acre average for soybean producers on owned land in the SWMFBMA.

That production is also spiked by a $1-per-acre premium Sinn gleans on top of market prices by raising non-GMO soybeans for a local elevator that ships them to a foreign market.

A family machinery-sharing agreement enables Sinn to have machinery costs well below the $75.02 machinery cost per acre for soybeans by the top 20% of SWMFBMA farmers on owned land.

He owns a row-crop tractor and one ridge-till cultivator with his father. He trades labor for use of a combine and 16-row planter owned by other family members.

Machinery sharing isn't for everyone. In Sinn's case, though, an atmosphere of give-and-take prevails.

It started with my grandfather, who was calm," Sinn says. "My dad and uncle are the same way – very easy to work with. My family is good at maintaining equipment, so we don't have to buy new every few years. In farming or in any other business, if you surround yourself with good folks, problems are easier to resolve."

Detractors of soybeans call them a corn cover crop. An intermission crop. Or even a weed.

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