Nick Paulson

We present revisions to the 2024 Crop Budgets for Illinois, highlighting changes from our January release for high-productivity farmland in central Illinois while discussing the more general trends across regions. We have revised corn and soybean prices down, while cost adjustments were mixed. Farmer return projections for corn are improved across regions, while soybean return expectations are improved for southern Illinois but similar or lower for other regions. However, farmer return projections remain negative for both corn and soybeans across regions assuming average cash rent levels.

Joana Colussi, Gary Schnitkey, Nick Paulson, and Carl Zulauf - Joana Colussi - Agricultural producers with goals of continuing exports to the European Union (EU) have 6 months to comply with new rules set by the EU to curb deforestation. As the EU is Brazil's second-largest trading partner, accounting for 16% of Brazil’s total trade, the rules will have an effect on Brazilian ag producers. The products specified by the EUDR account for 30% of the total value of Brazilian trade in 2023, with Europe purchasing more than a third of these exports.

Carl Zulauf, Jonathan Coppess, Nick Paulson, and Gary Schnitkey - Carl Zulauf -

Gary Schnitkey, Bruce Sherrick, Carl Zulauf, Nick Paulson, and Jim Baltz - Weekly Farm Economics -

Gary Schnitkey, Brad Zwilling, Nick Paulson, Carl Zulauf, Bob Rhea, and Jim Baltz - Gary Schnitkey -

Nick Paulson - Nick Paulson - Continued price declines have created concerns about farm incomes for 2023 and 2024. The price declines and county yield experience for 2023 suggest that PLC and ARC-CO payments are not likely to be triggered in most areas for corn, soybeans, or wheat. Even if ARC or PLC trigger support for 2024, would not be received until October of 2025. Given the current price outlook, careful budgeting and cash flow planning for the rest of 2024 and into 2025 will be critical.

Nick Paulson, Gary Schnitkey, and Carl Zulauf - Carl Zulauf -

Gary Schnitkey, Jonathan Coppess, Gary Schnitkey, and Nick Paulson - Carl Zulauf - In general, little relationship was found to exist between SCO payment per SCO insured acre and ARC-CO and PLC payment per base acre for barley, corn, oats, peanuts, long and medium grain rice, Japonica rice, sorghum, soybeans, and wheat over the 2015-2022 crop years. This finding raises questions about why SCO insurance can be purchased for historical base acres elected into PLC but not for historical base acres elected into ARC-CO.

Gary Schnitkey, Nick Paulson, and Carl Zulauf - Gary Schnitkey - A steep decline in prices across years has resulted in low to negative average returns to Midwest farms in 2023 and projected for 2024. Crop insurance programs are not designed to cover the risk of multi-year price declines and current commodity title programs are also expected to provide little relief for these low prices. Modifying commodity title programs to make them more market-responsive would aid in providing relief to farmers.

Carl Zulauf, Gary Schnitkey, Jonathan Coppess, and Nick Paulson - Carl Zulauf - Since the 1996 Farm Bill’s seminal policy change that gave farmers the freedom to decide which crops to plant or not plant, land in US farms has declined by 75 million acres or -8%. Most (88%) of the decline occurred in pastureland. It is thus incorrect to equate the loss of farmland to a loss of cropland. Cropland has declined by only -2% while pastureland has declined by -13%. The sizable decline in pastureland is consistent with the growth in confinement animal production.