Follow the field crops during the 2020 growing season.
Content by Jack Davis
This is the second article of a two-part series examining cash flow and income for South Dakota grain farms. This article will look at crop insurance, prices for 2020 crops, and changes in input prices.
Grain farming is facing a reduced income outlook for 2020. Unpriced old crop revenue has decreased and projected revenue for 2020 crop is reduced. Offsetting these decreases are chances that some input prices may fall, fuel related expenses and possibly higher payments from commodity title programs.
South Dakota producers can use the SDSU Extension Net Income Tool to monitor their expected net income per acre given their location, commodity of interest, and changes to market prices. The tool gathers the most-recent end-of-day market prices to determine the latest expected net income for wheat, corn, and soybeans in the different regions of the state.
Planting decisions for this spring are complicated given the recent spread of COVID-19. A very busy planting season is approaching quickly. Input suppliers and farmers will be met with a requirement to complete tasks timely to evade economic losses from delays.
Strong business management skills and systems do not go out of style in times of uncertainty. These skills will help the business work through downturns in commodity prices. Cash flow budget accuracy is critical in developing and controlling the business.
This winter it is time to study up on the Farm Bill elections and make an appointment with the local Farm Service Agency (FSA) in order to put the program in place for the farm. The deadline to make the election is March 15, 2020.
Crop insurance late plant dates are fast approaching for planting crops in South Dakota. The weather and soil conditions this spring will likely lead to some prevent plant situations for farm producers.
Farm and ranch businesses have a sizeable investment in equipment, buildings, land, and livestock. These investments require their owners and managers to remain knowledgeable about the financial condition of their business. The information to calculate measures of financial performance can be found in their farm record books or accounting system.
Crop insurance late plant dates are fast approaching for planting small grains in South Dakota. Late plant dates for corn, soybean, and sunflower are nearing as well. Producers will want to work with their crop insurance agent to explore planting options and reporting of prevent plant areas.