With two crops in the bin and one to go this season, Monroe County farmer Daryl Cates, secretary of the American Soybean Association (ASA), is thrilled with results up to this point.
Winter wheat yields for 2021 were some of the best he’s ever harvested this past summer, between 95 and 115 bushels per acre, and corn output was near a personal best.
Cates prepared to see if he could keep his luck going and shift right into soybean harvest, but was rained out much of the first week of October.
“I probably had the best wheat year I ever had and corn will be close to some of the best I’ve ever raised,” Cates said while picking up a part during a rain delay Oct. 5. “With the amount of moisture we’ve had, the double crop (beans) are looking excellent. I wouldn’t be surprised if there’s some 50-bushel yields on the double crop.”
But, while things look rosy for the time being, Cates is concerned for next year as he believes farm margins could tighten substantially, despite high commodity prices, as the result of rising input costs.
USDA recently projected farm input costs could climb $26.1 billion nationwide to $383.5 billion, the highest in at least five years.
“The old timers used to say if you get three good crops in one year, hold onto your pants next year because you’re probably not going to have a very good year,” Cates said. “With input costs and if the old timers are right, it could get a little dicey next year.”
Cates, who came back to farm full time with his father in 1980 near Columbia, about 15 miles south of downtown St. Louis, has seen the price cycles before and expected higher input prices. But nothing prepared him for what he and other farmers have seen so far this fall.
“My potash price last fall was $280 (per ton) and this year’s it’s $600, DAP (diammonium phosphate) doubled from last year and I use UAN, but can’t even get prices,” he said. “And, we’re hearing of spring anhydrous ammonia prices around $800 to $1,000.
“Most of us who farm, if we saw $50 to $75 (price) increases per ton, it wouldn’t be so bad,” he noted. “But over $200 per ton (fertilizer price increases) is outrageous.”
And the price runups don’t end in the fertilizer market. Cates expects seed costs to rise about 5% for next season, costs of some farm chemicals almost doubled, and the national gasoline price ($3.20 per gallon as of Oct. 4) reached its highest level since October 2014.
“The way things are going I might make less this coming year, even though commodity prices are higher, due to higher input costs,” Cates said.
He believes the situation could impact some farmers’ planting decisions for next year. On his farm, it just happens to work out that Cates’ rotation favors more soybeans and fewer corn acres next year.
Cates and other farmers also plan to take advantage of soil testing to see where they can reduce fertilizer rates to keep input prices down.
“I have a feeling if these (input) prices stay at these levels, we’ll see a switch from corn acres into beans next year,” he said.
Cates, a fifth-generation farmer, was elected to the ASA board in 2018 and plans to run for vice president in December. He previously served on the Illinois Soybean Operating Board (now known as the Illinois Soybean Association) from 1986-92, the American Soybean Development Foundation Board from 1988-92 and was appointed to the first United Soybean Board in 1992.
He served on the ISA board again from 2013-19, including two years as chair.