Harvest could be bin-buster

LINCOLN — Farmer David Deerson is keeping his fingers crossed.

His soybeans look good. Really good. Maybe his best crop ever.

But a smart farmer doesn't count his chickens before they're hatched — or his bushels before they're in the bin.

“I don't want to jinx it — I don't want a hail storm in September or something,” said Deerson, who farms near Mead, Neb.

His feelings are likely shared by many farmers in Nebraska and Iowa, where harvest is just beginning to get under way.

Thanks to cooler than normal conditions and perfectly timed rains, along with seed genetics and farm technology, many farmers are finding full soybean pods and fat ears of corn in their pre-harvest checks.

Earlier this month, the U.S. Department of Agriculture forecast the largest soybean crop and highest corn yields ever nationwide.

The USDA credited excellent growing conditions this year in the western Corn Belt and northern Great Plains.

But there's a week or two before harvest will be going full throttle. The same cool weather that produced the lush crops is making them slow to ripen. Deerson and other farmers are uneasy about speaking too soon about possible yields.

And while such large crops would be good news for a world with increasing demands for food and fuel, they will not necessarily translate into profits for farm country.

The USDA is projecting a 38 percent decline in net farm income from 2008, when farmers realized record profits.

The 2009 projection of $54 billion in net income would fall below the 10-year average of $63 billion, said Dave Miller, a south-central Iowa farmer who serves as the Iowa Farm Bureau's director of research and commodity services.

“I would suspect there will be more farmers exiting the business this winter than there was last winter,” Miller said. “There'll be some financing pressure out there.”

Almost as soon as the USDA projections were released, market prices for corn and soybeans began sliding.

As of Wednesday, December corn was trading at $3.29 a bushel on the Chicago Board of Trade, while November soybeans were selling at $9.16 per bushel.

That's well below last year's prices of nearly $7 per bushel of corn and $11 to $12 for soybeans.

For its part, Nebraska is projected to have a record corn crop and its biggest soybean yield per acre.

Iowa, meanwhile, also is expecting a record corn crop and a 14 percent boost in soybeans compared to last year.

“This is probably the best crop I ever raised,” said Darrel McAlexander, who has farmed more than 40 years near Sidney, Iowa. “We've had an excellent growing season on my farm.”

Deerson said it's possible he could harvest more than 70 bushels of soybeans per acre in one particularly productive field. For comparison, Nebraska's projected record soybean yield would be 51 bushels per acre.

Miller said that with more product to sell, farmers with marketing savvy and minimal land expenses could make money this year.

A big crop could benefit struggling livestock producers, who have been pinched with higher feed costs as the economic downturn suppressed global demand for meat, said Ephraim Leibtag, senior economist with the USDA economics research service.

Grocery store shoppers probably won't notice price changes, however.

The economy already has whittled down food prices since last year, Leibtag said, and there don't appear to be any factors on the horizon to force food prices up.

“Good supply, good production, a good harvest, those things can only help in terms of keeping prices low,” he said.

Ag Processing to upgrade plant

Ag Processing Inc. of Omaha said it would spend millions of dollars at its Dawson, Minn., soy processing plant to install a new, more efficient extractor to remove soybean oil from soybean flakes.

The cost of the project, to start next spring and be completed by late 2011, is still being determined.

The plant produces meal and oil from more than 550,000 acres of soybeans a year.

—Steve Jordon

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