A big harvest has prices slipping, but farmers see the value of investing for the future.
Last week at the Precision Aerial Ag Show I had the opportunity to talk with folks about a lot of things. I also got a look at a substantial corn crop on my drive from Bloomington to Decatur. With corn slipping below $4 on the Chicago Board of Trade, and continued predictions for a bumper crop, there’s some concern about income. Yet, folks looking at new technology see the value of investing for the future.
Perhaps that’s true thanks to a lesson I learned a long time ago – a farmer is happier with a bin full of $4 corn than an empty bin when prices soar. You know you can always figure out a way to make money on that stored corn – and the early season price run-up in the corn market did offer pricing opportunities. No, I’m not a market analyst, just a good listener – and the Penton Farm Progress Group works with a range of market analysts.
So what do sub-$4 corn and $10 soybeans mean for the future of your investment in farm technology? My guess is it may slow, unless you pencil out the payback, which some technologies offer pretty quickly. I see rising interest in irrigation technologies in the Midwest after the 2012 drought – let’s not forget that weather is still the master in your field.
But those irrigation technologies will mean more than simply lower-pressure nozzles, we’re seeing investments in soil moisture sensors and systems that match crop potential with water applied. If you want to maximize water use in your irrigation system tech investments offer quicker payoff.
The same holds true for all that unmanned aerial vehicle interest last week. Many tech-savvy readers are hungry for better information about what’s going in the field in-season. UAVs are a natural in an irrigation setting – a simple camera-setup unit can ‘run’ an irrigation pivot in 8-foot-corn and allow you to see if a nozzle is shut down. No reason to wait for the ‘streaked’ yield map where the pivot failed. And fixing a busted nozzle in an irrigated field has a true bushels-per-acre payback.
As we learn more about in-season applications of fertilizer for corn – and soybeans – we’ll want to know more about how the crop is taking up key nutrients at critical growing points in the season. A nitrogen-stressed corn crop that can get a 20 bu./acre boost in yield with a high-boy application of fertilizer is worth the investment even with $4 corn.
Tech investments are now part of agriculture. It’s July but I’ve already got a calendar that’s filling up fast with media events aimed at showing off new technologies. While I can’t say what you’ll see – I haven’t seen them yet – I expect increasing efficiency and productivity to be key “traits” for the new tech we’ll be seeing.
Farmers are learning that ‘information’ is more than a call from your agronomist. Gathering details about your farm and what’s happening in-season beyond simply using a yield map, which is always after the fact, will become more important in the years ahead.
The long-term demand curve for commodity crops is up. The potential for higher incomes in ag will continue. While 2014/2015 may see a dip, in the long-term there’s good news. For now use the tech you have to track the markets and make profitable selling decisions.