With the new profit opportunities Wall Street investment fund managers and analysts are seeing in agriculture, there’s more New York City interest in food and fiber production than there’s been in decades.
To meet this information demand, No-Till Farmer and the financial investment firm of Boenning & Scattergood in Conshohocken, Pa., recently cosponsored the annual Ag Day In New York City conference. The event drew 50 investment fund managers and financial analysts to learn about the latest ag trends from Indiana and Pennsylvania no-tillers, plus farm equipment and grain business executives.
Here are a few key takeaways from the conference.
300-Bushel Corn?
Tom Evans of Great Plains Mfg. outlined how producers may top the 300-bushel level with corn by 2030.“Residue management is going to be absolutely critical, especially as more growers shift to continuous corn to meet the growing demand,” says the company’s vice president of sales and marketing.
He outlined a half-dozen ways growers can boost yields that can add an 89-bushel-per-acre increase. This included more efficient usage and placement of fertilizer, reduced planting speed, effective use of planter accessories, better hybrid selection, and using new innovations such as vertical tillage to control residue and twin rows to push up yields. More efficient use of light utilization with new hybrids, narrower row widths and increased emphasis on root growth will also boost yields, Evans says.
However, he believes the biggest yield increases will come from newer hybrids that will let growers push corn populations to 55,000 plants per acre. These developments could add up to another 105-bushel-per-acre increase.
“By going from 35,000 to 55,000 corn plants per acre, a grower can get a 7-bushel boost for every 1,000 more ears,” Evans says. “For a Midwestern grower who’s harvesting 200-bushel yields, these two yield boosters could get him to 394 bushels per acre.”
Steady Farming Gains
Veteran no-tiller Ken Rulon, who no-tills with his brother and cousin in Attica, Ind., says the key to success is effectively managing all of the risks. He sees many opportunities today in ag:
• Bad weather equals higher prices. “We get normal weather only 20% of the time and too much of our water doesn’t come at the best time for growing a crop,” he says.
• Higher energy prices means higher grain prices.
• A weaker dollar leads to increased land values.
• Higher interest rates mean it’s time to consolidate farming operations.
• A farm depression represents a great time for innovative, efficient no-tillers to grow their farming operations.
Rulon says tiling is one of the keys to earlier no-tilling, even though only 4% to 7% of U.S. acres are adequately tiled.
Pricing Concerns
Thanks to 25 years of no-tilling, Ray McCormick says the cost of nitrogen is the most critical factor in all of agriculture today.
“It’s too high priced and can be produced cheaply from natural gas,” he says. “This has led us to grow much of our own nitrogen needs in the form of cover crops.”
Cover Crops Profitable
Steve Groff of Holtwood, Pa., says managing cover crops means reorganizing your cropping system. He says there’s much more to using cover crops effectively than just adding a missing piece to the cropping puzzle. Groff evaluates 20 to 25 cover-crop mixtures each year to see how each can provide cheap nitrogen for corn crops.
“Nitrogen prices will be a key to success with cover crops,” he says. “If nitrogen rates keep going up, the use of cover crops to replace 25 to 40 pounds of purchased nitrogen will increase dramatically.”
$15,000 Land Values?
With Wall Street looking at investing in agriculture, soaring farmland prices were a hot topic.
“With $6-per-bushel corn, you can make a case that farmland is not overpriced at $15,000 per acre,” says Tom Dorr, the president of the U.S. Grains Council in Washington, D.C., and a farmer in northwest Iowa. “While my farmer friends don’t like to hear me say this, it’s true.”