With 2011 break-even costs of $4 per bushel for corn and nearly $9.50/bu. for soybeans, coffee shop chatter is already suggesting corn will win the battle for more acres. “We just feel a little more confident that we can more easily beat ‘trend line’ yields with corn,” said Dean Simonsen, veteran Brown County, Minn., producer.
Break-even figures for 2011 are considerably higher from previous years because every expense of crop production is up. “The expected 2011 break-even prices compare to $3/bu. for corn and just over $6/bu. for soybeans as recently as 2008,” said Kent Thiesse, government farm programs analyst and a vice president at MinnStar Bank in Lake Crystal, Minn.
But the good news, Thiesse said, is that current local forward prices for fall 2011 are near $5/bu. for corn and $11.50/bu. for soybeans. Both of these prices should be well above break-even levels for most producers. But will that $1 margin on corn attract more new acres than a $2 margin on soybeans? Using last year’s record average corn yield of 175 bushels per acre, the corn arithmetic projects to $175 profit per acre. But based on the 2010 state average soybean yield of 44 bushels per acre, soybean’s $2 margin generates only $88/acre profitability. In essence, for 2011 corn profits virtually double the profit outlook for soybeans. In 2009, the Minnesota soybean crop averaged only 40 bu./acre.
“Up here in the more northern corn-soybean production areas, corn is always going to win,” said Sham Moteeiall, key account manager for Hefty Seed Co. at their Olivia, Minn., plant. “And you’ve got to always plan to be above ‘trend line’ yields or you’re just shuffling along with average performance and average profits.”
Simonsen’s 2010 corn crop averaged about 192 bu./acre. “Even our corn-on-corn ground did good this past year,” he said, “but if we don’t get too wet, or too dry during June-July and have a good weather month during August, we can push 65 to 70 bushel yields on soybeans. So because future prices for both corn and soybeans are so competitive, I don’t see much shifting in corn and soybean acres across Minnesota.”
Thanks to ideal weather, Simonsen wrapped up his primary tillage and fertility work last fall, which pretty much declared his corn and soybean acres for 2011. “That’s the situation for most of us. Crop choices are pretty much locked in.” He hedges just a bit. “Depending upon contract prices, edible bean acres or canning crops could grab a few more acres. Even wheat with its much stronger price outlook could make a showing.”
“I frankly don’t anticipate much switching from soybeans to corn,” said Dave Schwartz, Gold Country Seeds soybean product lead. “Granted a great year for corn, but many growers this past season also experienced their best ever soybean yields. And they realize the additional rotation value of soybeans. Because soybeans keep improving, and growers keep getting better I can see more soybeans on those less productive soils where corn is less attractive. I’m talking the western Dakotas, northern stretch of the Red River Valley.
“But through the heart of the soybean belt I don’t anticipate much switch in acres one way or the other. Prices for both crops are strong, even future prices look extremely good for both corn and soybeans. So if both are generating good profits, I just don’t see a major shift.”
He points out that soybean breeders have developed certain soybean lines that definitely perform better in dryer conditions. “We’re looking at varieties that are more bushy, with more branching, and generally just a bit taller. In drought conditions soybeans tend to shorten up often leaving only a 12- to 16-inch plant. A taller plant for those conditions gives you more pod development and a better harvest,” Schwartz said.
He suggested you keep soybeans more competitive with narrow rows, good soil fertility and good drainage. “Soybeans like their feet warm and dry. So drainage really is a key factor in better soybean yields. But more important is selecting the varieties that best fit your soils and your management style.
“Outstanding genetics means higher yields. Quality of that seed is equally important. And always fit your soybean selection to your soils, field by field.”
“Sudden death syndrome” that almost mysteriously shows its impact in scattered areas from season to season, might be more a condition of compacted soils, but Schwartz said university research still isn’t clear on causative factors of SDS. “I’ve noted it more in lower areas of a field that might be more compacted because of moisture conditions, and in headlands where soil compaction is very real. It could be internal drainage factors.
“Some varieties sold in Minnesota now have SDS ratings so take note of that when choosing varieties. Also avoid early planting in those fields were sudden death issues have been a problem.”
With soybeans being planted earlier, is there a yield gain by planting a later maturity variety than recommended for a particular area? Schwartz acknowledges that farmers are planting soybeans earlier than previous years (weather permitting), but doubts they are also going with extended maturities.
“It so much depends on the spring. An early, fast start like in 2010 and growers are more likely to stretch the maturity but you don’t necessarily gain yield. If for example a 2.0 is a full maturity bean for your area, going to a 2.5 won’t guarantee more yield. But it does guarantee more risk,” he said. About a half-bushel yield loss for each one-day maturity reduction is generally accepted, he said. Thus dropping from a 2.0 to a 1.5 RM typically would mean about a 2 1/2 bushel yield decline on average.
Schwartz suggested a broadcast fertilizer gives better response than a starter fertilizer. Where soybeans are irrigated, he recommends a foliar fungicide treatment applied at the R3 to R4 stage of growth.
How about fungicides on a regular basis, even if not irrigating? He said that depends upon the season. “This past year, lots of lush growth with more humidity, more rainfall and the resulting more disease pressure. Fungicides proved their worth. But a more normal year I can’t justify fungicides as part of a routine soybean program.”
Planting rates for soybeans have lessened to a recommended 140,000 seeds per acre. That is why many seed companies now package their bagged soybeans in 140,000 seeds per bag. In richer, manured grounds where white molds might be an issue, Schwartz suggests a 125,000 to 130,000 seeds per acre planting rate.