Crop Input Prices To Increase

Waterloo-Cedar Falls Courier:

Producers got some good and bad news Wednesday, Dec. 7, at the AG Expo in Osage. Agriculture experts forecast another financial windfall next year raising corn and soybeans, but profitability beyond 2012 is in serious doubt as input costs eventually overtake grain prices.

Chad Hart, Iowa State University Extension grain economist, told more than 100 producers and ag business officials at the Cedar River Complex Events Center that the cyclical nature of grain profitability will most likely catch up to producers in 2013. Landowners renting or selling ground and companies selling fertilizer, equipment, seed and other crop inputs have watched farmers rake in excellent profits in recent years and they want a bigger share of the pie.

Hart warned farmers that tough economic times lie ahead. Representatives of businesses at the expo didn't necessarily disagree.

"In 2013 you will be happy that you have money socked away," Hart told a producer at the expo. "Farming is competitive. I expect costs to catch up with prices."

Corn and soybean values have about doubled since 2006. Production expenses haven't escalated as much, but that's about to change.

Ouch. After seeing next year's fertilizer bill, I can't imagine it getting even higher.  We're protected on the cash rent side, but the other inputs bite us on the ass.  I'm definitely not looking forward to 2013.