Winter allows the corn and soybean producer some down time to assess last year’s results and more importantly, make plans and projections for the coming year. This winter is certainly providing a wealth of issues to consider, making the long nights go by faster. January’s USDA crop report gave us the final numbers of 168 bushel/acre for corn and 48 bushel/acre for soybeans. Corn yield was not quite a record while soybeans set a new record for yield per acre. This is the third year in a row of near or above trendline yields, following three years below trend in 2010, 2011 and 2012. Once again, the American farmer has proven that given decent weather, our capacity to produce is substantial. Our world competitors also acted on the positive price signals and increased production as well. What this has amounted to is not only higher U.S. carryover numbers but also world stocks. These bushels will act as a strong cushion if we have any weather events this year and limit price advances.
The land market continues to be a mixed bag. Some will argue that values are down substantially from the peak in 2013; others will argue it’s only down moderately. Both could be right, depending on market segment or location. Generally, we’ve seen values off by 15- 22% from the highs of two years ago. This would take $12,000 land down to the $9,500 to $10,000 range. In referring back to this article in 2013, we noted that only half of the several hundred transactions we’d tracked in Northwest Iowa sold for $10,000 or more. We tend to forget that many farms were still selling for four, not five figures. For our region, which is the 23 northwestern counties in Iowa, the annual Iowa State Land Value Survey placed each county at slightly up to down moderately. Four counties in the northwestern corner were each assigned gains of 1.69% while ten counties slipped in value by 2% or less. Another nine counties in our eastern or southeastern areas were 2-6% lower over the past year. The ISU survey is down 12.4% state-wide from 2013 to 2015.
Dakota Access Pipeline: The final decision by the Iowa Utilities Board whether to approve the permit for Dakota Access Pipeline should be in March. They will likely be granted the ability to use eminent domain to secure the balance of the land needed for the project at the same time. As of this writing Dakota Access claims to have 87% of the easements signed voluntarily. Major concerns are liability if a spill were to occur, restoration of the land once construction is completed, and effects on the tile drainage on the farm with the pipeline interfering with grade of tile being altered. Most of these concerns have been addressed
Drainage, whether natural or artificial, is one of the biggest factors that determines a farm’s yield potential, and most of the time it can be improved with tile. While it may seem counterproductive to drain subsoil water during a dry year, tiling removes only excess water not available to plants.
Grant Aschinger was awarded the Accredited Farm Manager (AFM) designation from the American Society of Farm Managers and Rural Appraisers (ASFMRA) at its annual meeting in San Antonio, Texas, October 2015.
