Grain Markets and Land Rent

Following the drought in 2012, grain prices rose to levels that had not been seen before. Due to the high grain markets many grass fields in Waushara County and Central Wisconsin were plowed up and planted to corn.

Corn prices of $6 per bushel made it economical for producers to grow corn on these unirrigated fields even with corn yields that might only reach 80 to 90 bushels per acre.
With market prices for corn now around $3.10 to $3.30 per bushel it is no longer possible to cover production costs with only 80 bushels of corn per acre. Input costs to produce a crop of unirrigated corn are around $550 per acre; to grow a crop of irrigated corn the production costs are around $750 per acre. It’s very likely that some of the fields that were taken out of grass after the 2012 drought may not be planted in 2017.

Landowners who have received increases in what they receive for land rent may be looking at significant decreases in what producers will offer for the use of land in the coming year. Even if producers don’t pay any rent, it is still not economically profitable to grow corn or soybeans on unirrigated sandy soil in Waushara County.
For many landowners the question may be what can they do with unirrigated land if there aren’t any growers willing to risk the investment needed to grow a crop of either corn or soybeans.

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