Iowa farmers are preparing to roll out their combines for harvest season but they may be hitting the fields in a few weeks with mixed emotions. A new report from the U-S Department of Agriculture projects a four-point-three bushel-per-acre increase in the corn yield nationwide. The U-S-D-A’s chief economist Joe Glauber says that much corn means only one thing. “No question, looking at lower prices as a result,” Glauber says.

Corn prices have been falling all summer and the latest projection shows another 21-percent decrease in prices in the next marketing year for corn. Soybean prices are also expected to drop 23-percent. Iowa is the nation’s top producer of both corn and soybeans so those statistics will hit especially hard here. “The question is, where does all this look once you’ve netted out the cost of production,” Glauber says. “I think the real factor there looming has been the high cash rents. We know cash rents have gone up over the last few years. In some areas, they’ve begun to come down a little bit and we’d expect with lower returns, certainly, that those will come down.”

However, what was paid for cash rent this year is what will go into the production formulas. A U-S-D-A report out last week found the average price to rent Iowa farmland has gone up slightly this year, averaging 260-dollars per acre for corn and soybean ground. That’s about five-dollars an acre higher than last year. Glauber says it may be a challenge to find places to put all of the bumper crop.
“Pressure on storage capacity is going to put pressure on transportation,” he says. “There are already problems in the transportation service, particularly in the Northern Plains, where we’ve seen bases widening, long delays.”

Glauber says the good news is — there is a market for all that corn about to be harvested as ethanol production and exports remain very strong. Iowa is the nation’s top ethanol producer.

(Radio Iowa)