In bad news for farmers who are struggling to stay solvent, low prices for corn and a smaller than expected harvest in 2014 have combined to cause a big drop in the value of Minnesota's largest cash crop.
The low yields and poor prices dragged down the value of the corn crop to about $4.7 billion, down more than a third from the previous year.
The U.S. Agriculture Department's final corn crop estimate for 2014 showed a sharp and surprising drop in the number of bushels harvested per acre.
In November, the USDA forecast the average corn field in Minnesota would yield 165 bushels per acre. The agency has dropped that estimate to 156 bushels an acre.
Farm commodity consultant Peter Georgantones of Abbott Futures in Minneapolis said several clients told him an early frost in September cut the number of bushels each acre produced.
"I had a half a dozen guys there that got nipped," Georgantones said.
Later, heavy snow in November prevented harvesting, leaving some farmers with corn still standing in the fields. Compounding problems with the crop are low corn prices, which are well under break-even for most.
As a result, not only did Minnesota farmers harvest fewer bushels of corn per acre than those in most other states last year, they're also earning much less money for each bushel than in recent years. That's expected to reduce farm income in the state.
Georgantones said farmers are also facing bad news on soybean prices.
"The bean market's in real trouble here right now," he said. "We're about to harvest a huge South American crop."
The harvests in Brazil and Argentina will add to already ample world-wide supplies and likely drag down soybean prices to below the break-even point for many U.S. farmers. All in all, Georgantones says the economic news at the start of 2015 is not very good for crop farmers.
"It's going to be a rough year," he said.
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