Gloy, Brent, and David Wimar. “Are You Betting on Corn in 2021.” Michigan Farm News, 17 Mar. 2021, www.michiganfarmnews.com/are-you-betting-on-corn-in-2021-.
When farmers think of investing in a crop such as corn they must also consider the other options that they have at hand, specifically soybeans. Why might a farmer invest in soybeans over corn, and is it worth it in 2021? Well “the 2021 Purdue crop budgets have variable costs at $436 for corn and $249 for soybeans”, therefore farmers would have less money invested in soybeans. Furthermore “the chance of generating less than $300 per acre is about 20% under corn, but only about 8% for soybeans”. To sum it up there are many factors that one has to look into when deciding in planting/ investing soybeans vs corn, but at the moment soybeans is a more economically safe crop to bet on. Though this does not mean that planting corn is a bad investment, think of it as if a poker player had the crops as their cards. “For 2021, the crop insurance price ratio favors soybeans slightly more than the last time we observed a roughly even acreage split between corn and soybean. However, the poker player considers more than just the cards in their hand – their chip count, the size of the bet, etc. Similarly, producers will also be considering the overall economic environment and the potential payout for betting on corn.”
I enjoyed reading this article due to the fact that it provides a lot of overthought information such as how each farmer has to make individual decisions about each crop that they intend on investing in. Through researching the economy of corn It has been shown that corn is not the most economically viable crop in 2021, and that it is outmatched by soybeans. The article summarizes many of the economic upsides as well as downfalls of choosing corn over soybeans, what it means, and how corn may take an impact. This article also supplies visual evidence of the differences of prices and the distribution of outcomes for the contribution margins of corn and soybeans.
Interesting that soybeans have more economic potential this year than corn. I’m wondering why the market wants soybeans more than corn right now. Also, what sort of environmental implications does this trend have, and how is it connected to environmental science?
Great questions! It is not necessarily that the market wants more soybeans than corn, its that soybeans are a lot cheaper to produce, and that they are able to be sold at more of a profit than corn. Furthermore these crops require hundreds of acres of land as well as thousands of gallons of water to remain healthy, which does hurt the environment, but this article was focused more on the economic values of these crops over the environmental impact.