This week’s farm and rural news roundup has info and reaction to the latest farmland cash rent estimates, just issued by USDA, along with university interpretation of the latest USDA farm income forecast. We also have more news to report from the 2017 Farm Progress Show, held recently in Decatur. Please read on …
Recent cash rent estimates issued
SPRINGFIELD — USDA’s Illinois Cash Rent County Estimates report, released Sept. 8, shows that the average cash rent across all 102 counties is averaging $236 per acre for irrigated crop land and $218 for non-irrigated land. The report, which is based on excellent condition cropland, showed that farmers in the state’s northwest district (including LaSalle and Will counties) are paying the highest average cash rent, at $294 for irrigated land. That was followed by rents in eastern counties such as Champaign and Kankakee, where farmers pay an average $262 per acre, and in the northwest (from Bureau County through JoDaviess County), where an average $254 per acre is paid.
The lowest average cash rent amount is found in east-southeast Illinois, where just $194 per acre is paid for farmland, according to the USDA report.
The USDA report comes shortly after the issuance of the University of Illinois and Illinois Society of Professional Farm Managers and Rural Appraisers’ (ISPFMRA) mid-year survey of cash rents. The study, which was discussed by Soy Capital’s David Klein during a Sept. 1 U of I webinar, found that the 2017 expected average cash rent paid for all quality classifications of farmland will be $160/acre. This compares to the 2016 final estimate of $166/acre for average farmland cash rents published by the survey.
Klein, who serves as co-chair of the Land Values Program for ISPFMRA, said that the drop in average prices reflects the “soft” farmland values trend in Illinois of the last few years, which he blamed primarily on lower commodity prices received by farmers. “Most farm managers seem comfortable that variable cash rent leases are adjusting rents properly,” he said.
Farm income estimates surprise farmers
URBANA — The Aug. 30 USDA 2017 Net Farm Income report raised the forecast for net farm income for the year to $63.4 billion, which is $1.1 billion, or 1.8 percent, higher than the government’s February report indicated. Also raised were the eyebrows of millions of row crop farmers and their commodity organizations, who are wondering where all the additional income is coming from. The source of the newfound wealth lies within the livestock sector, according to farm economists from the University of Illinois and Southern Illinois University.
“The increase in net farm income forecasts may come as a surprise for many observers in the Corn Belt, as the region continues to experience lower crop prices, yet the increase between the February and August projections is driven, in large part, by changing expectations in the livestock sector,” according to the Todd Kuethe and Todd Hubbs of the U of I Department of Agricultural and Consumer Economics and Dwight Sanders, Department of Agribusiness Economics at SIU. “For example, forecasts for 2017 in animals and animal products increased 8.4 percent, while the forecast for crop cash receipts increase a mere 0.3 percent.”
The economists noted that USDA net farm income forecasts have traditionally increased from February to August, and that the trend appeared in 2016, as well. “The most recent USDA net farm income forecast suggests that 2017 is expected to exceed official estimates of the previous year for the first time in three years,” the report concludes. “The history of the USDA’s net farm income forecast, however, shows that current growth projections are likely to moderate throughout the remainder of the forecast period.”
The entire essay, “Interpreting USDA’s Recent Farm Income Forecast,” may be found at the U of I farmdocDAILY website (www.farmdocdaily.illinois.edu).
GHSC targets youth safety at FPS
DECATUR — Central Illinois-based Grain Handling Safety Coalition (GHSC), now a national group of volunteers devoted to preventing grain bin fatalities, directed their message to youth attending the recent Farm Progress Show in Decatur. The University of Illinois-GHSC Grain Bin Lifeline Protection System was on full working display on Aug. 29, the first day of the show, with GHSC volunteer Lynn McClure strapping youngster after youngster into the specially designed safety harness used in the Lifeline system for simulations of how the equipment functions.
The GHSC, which was founded after the tragic 2010 deaths of two teens in an Illinois elevator’s grain storage bin, also issues their educational materials, resources and strategies online for use by schools, grain elevator operators and farmers. The coalition offers best practice prevention strategies for grain bin entrapment and engulfment, falls, entanglements, electrical hazards and more in seminars or on the GHSC website: www.GRAINSAFETY.org.
Seed relabeling study issued at FPS
DECATUR — A new study from the Farmer’s Business Network (FBN), unveiled at the 64th Farm Progress Show in Decatur on Aug. 29, examines how seed relabeling works, which seed companies are relabeling the most, and the price impact on farmers based on analysis of over 7,500 seed tags. The study found that seed relabeling creates two significant problems for farmers, including overpaying for seed and lack of genetic diversity.
“One seed was found being sold by 12 different brands. Since different brands often sell identical varieties for very different prices, some farmers significantly overpay, not realizing that other brands sell the same variety at a lower price,” noted FBN’s Megan Fallon in a news release announcing the study’s findings. In addition, “The widespread practice of relabeling means the available genetic diversity on the market is far less than it would appear. It is easy and common for farmers to unknowingly purchase the same variety from each brand, thereby increasing their genetic risk.” More about this study can be found on the FBN website.
Illinois Farm Fact:
In 2010, the year of the Grain Handling Safety Coalition’s founding, more than half of reported grain handling accidents involved fatalities. (GHSC/GFAI)
—R.F.D. NEWS & VIEWS–