We’re about two weeks away from the end of another year and I’m just a few hours away from hearing one of the first major crop predictions of where the new year will go.

I’m in Wilmington, Ohio, for the 2011 Ohio Grain Farmers Symposium which begins early morning Dec. 15, for the “early-bird” market report and projection.

Last year, economists were predicting near record prices for corn and soybeans and we saw many of those prices come true. Unfortunately, both commodities shaved off a few dollars per bushel later in the season, but from my experience that seems to be the way it goes — the closer you get to harvest, that’s when the prices fall. Not always, but I’ve seen it quite a bit.

Last year, there was some concern among crop and livestock producers as to whether commodity prices might actually go too high.

Sound advice

Economists and crop farmers agreed that $8-plus corn might have its benefits, but also could put a serious hurting on other industries and even crop farming itself. I heard more than one crop farmer say he’d like things to balance off a bit, to make things work for everyone.

Steve Beier, of The Andersons Grain & Ethanol Group, gave last year’s early-bird market report.

“Be careful what we wish for,” he said, exactly one year ago. “We could see eight-dollar corn, we could see nine-dollar corn. I’m going to challenge you that if we see that kind of an environment, it’s going to put a lot of stress on the industry.”

As commodity prices go up, so do all the inputs like fertilizer, herbicide, pesticide, livestock feed, rent and you know the rest…

Anybody who thinks the higher commodity prices of the last couple years all leads to more profit for farmers doesn’t understand the whole picture. No doubt, higher prices have benefited many farmers across the state, as cash receipt data and word of mouth will confirm. But the equation is much more complicated than price increases alone.

Looking ahead

I don’t claim to hold the answers to the grain market and I honestly don’t know many intelligent people who would. But, we will get a good look today by some of the people who have as much insight as anyone, and then we’ll see what happens from there.

The one thing I am certain of is the uncertainty of how the weather in 2012 will work in favor, or against, grain production. I don’t think even the best climatologists had envisioned the amount of record-setting rain we had this spring and fall, although some were predicting a wet year as early as last winter.

Follow along on our website at www.farmanddairy.com, and in our upcoming edition for the analysis at the grain farmers symposium. It’s just one of many forecasts that will be made over the next few weeks, but it’s our best available information and it’s usually right about at least a few things.

Some of last year’s key advice was to invest in crop insurance and other financial protection plans, to sell at a “comfortable” price instead of trying for the high — missing it and being forced to sell at the low.

“You need to spend a little money to take that volatility out, so that you don’t have to be all right or all wrong in this market,” Beier said a year ago. “If you go for that $8-$9 corn, you might get $4 corn, and you’re not going to feel good about that if you had a shot at $6 corn,” he said.

Those were super good suggestions a year ago, and they sure played out over the 12 months that followed.

I am confident what is said today by economists and the leaders for the Ohio Soybean Association and Ohio Corn and Wheat Growers Association will be equally important for 2012.

They may not predict the prices to the cent. But they will forecast trends and common sense concepts worth your attention.

Chris Kick lives in Wooster, Ohio. An American FFA Degree recipient, he holds a bachelor’s in creative writing from Ashland University. He spends his free time on his grandparents’ farms in Wayne and Holmes counties.
Chris Kick
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