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The Price of Corn
Captplaid
Member Posts: 20,296 ✭✭✭
Is it wrong for a farmer to make a profit without a federal subsidy?
It's basic supply and demand. Demand has increased around the world.
The way the press makes it sound, farmers are supposed to be poor.
It's basic supply and demand. Demand has increased around the world.
The way the press makes it sound, farmers are supposed to be poor.
Comments
The articles I've read generally state that corn prices are rising due to increased demand for ethanol, therefore increasing food prices.
It will truly suck for the average American if food prices become tied to oil prices [xx(]
The purpose of NAFTA and CAFTA is to make sure that the American public (voters) have a CHEAP supply of food.
The Free Trade Agreement with Australia/New Zeland is on hold until the fallout settles on the NAFTA & CAFTA agreements.
We as a Country spend less on food than any other Industrialized Country on Earth.
Now that the price has increased they cry "ETHANOL".
The price of corn is a major cost in producing ethanol. With corn at $3.25 and possible $4.00 in the future, there isn't much profit for the ethanol producer.
Corn and every product associated it will only rise.
...The current "feel good" idea of ethanol mandates for fuel will cost all of us dearly, already are. As usual, the libs and echo freaks have not looked any further than the end of their nose when it comes to ethanol mandates/usage/production.
...Corn crops are now being competed for by fuel co.'s, not just food producers, that is what is driving up the price of corn, supply and demand. The twit nit government and echo freaks did not take this into consideration. Corn destined for food products is now being channeled into fuel production. If the new fuel Bill gets passed, it will only get worse, God's not making anymore dirt to plant...[;)]
Take them out.
Polident is rather strong stuff.
This could be a real boom time for farmers if all the profits aren't cornered by the oil companines who are working hard to buy up everything in the alternative energy sector.
When filling out the paper work to apply for any of the government subsidys, the applicant has to give production numbers for which ever product they are wanting a subsidy for.
What better way to gather information on production than this?
When actual production is known, adjustments can be formulated or made to keep the cost of food down for the general public.
"The annual U.S. average farm price of corn in the 1960's ranged from $1.00 to $1.24. The average prices of soybeans ranged from $2.13 to $2.75 per bushel. The world changed beginning in the early 1970's, as there were significant crop problems around the world and the former Soviet Union began importing commodities. The average price of corn jumped to $1.57 in 1972, $2.55 in 1973, and $3.02 in 1974. The average price of soybeans jumped to $4.37, $5.68, and $6.64 in each of those years, respectively. It was the beginning of a new era for prices.
The current market situation for these crops is characterized by a small U.S. soybean crop in 2003, a high rate of soybean consumption by China, declining competition from China in the corn export market, a weak U.S. dollar, rapid expansion in consumption of corn for ethanol, small U.S. and world grain inventories, and relatively high prices. Are these markets embarking on another new era of higher prices?
The inability of corn and soybean prices to remain at consistently high levels historically makes us initially skeptical of such prospects. The high corn prices of the early 1970's quickly faded by the late 1970's. Prices were at relatively high levels from 1979-80 through 1984-85, fueled in part by small U.S. crops in 1980 and 1983. Since 1983-84, however, the annual average farm price of corn has averaged above $3.00 only in 1995-96 and averaged under $2.00 from 1997-98 through 2001-02. The annual average price has been above $2.50 only 11 times in the past 30 years, most recently in 1996-97. The price pattern for soybeans has run a similar course. The annual average price was above $6.00 only 12 times in the past 30 years, most recently in 1997-98. The average was under $5.00 from 1998-99 through 2001-02. The highest average price occurred 20 years ago."
I can remember shoveling well over three thousand bushels of ear corn back into a sheller in the mid-60's because shelled corn was selling for $1.18 instead of $1.08 for ear corn.
That's a lot of hot July work for $.10 a bushel.[:)]
Same tractor today is around $100,000, and the cost of seed, fertilizer, and herbicides have increased as much in percentage as the tractor.
Only the corn hasn't increased by 5-6 times.
The public needs/wants cheap food, but can't figure out that subsidies create crop surpluses that help to hold down prices, though ethanol is slowly changing that element.
The primary tax money (96+%) for the subsidies comes from the top half of the income earners in the country, but everybody gets the result in cheaper food.
Just another income and wealth shift program to keep the public happy.[:)]
All the oil crop farmer will be stinkin fithy rich when ya all convert to biofuel manufacturer..its your call! $$$$$$$$$$$$ [;)]
Don't bet on it. The cost of ground has already nearly doubled in some areas, and the cost of nitrogen is tied to natural gas.
Costs are rising fast, though not as fast as crop prices right now, but the decades old track record shown in the post above says that will change soon.
It always has.
There are only 1200 gas stations in the whole of the US that dispense E85 ethanol, surprisingly the car capitol of the World, California, only has 4!
http://e85vehicles.com/e85-stations.htm
So where's all this ethanol going?.
OK I gotta ask, what demand for ethanol?
There are only 1200 gas stations in the whole of the US that dispense E85 ethanol, surprisingly the car capitol of the World, California, only has 4!
http://e85vehicles.com/e85-stations.htm
So where's all this ethanol going?.
10% blend in the rest of gasoline sold.
The ethanol plants were built with $2.00 to $2.50 per bushell cost figured in. How do you make the farmers produce more? Raise the price per bushell during planting and say there will be a shortage come fall. And when fall comes around.... well guess what, we made a mistake, there's too much corn.
I sure hope I'm wrong and the price stays up, but I got a bad feeling about it.
And yes, the farm I live next to is pushing trees and wetlands out for more acres. I sit and watch him from our porch, everyday.
Hey, look at the bright side of it. The farmer in my county who, according to www.ewg.org, has the highest total subsidies for the last 5 years has built himself a brand new house, and just put up a new 40' x 80' by 18 foot tall pole barn. Those poor broke farmers.
Got guns?
Two years ago, pasture and cattle paid better than corn. The field was probably 100-125 bu per acre at best. The soil is sandy and old. Then there is the loss due to deer.
None of these are going back to corn production. I don't think there is much marginal ground around here that isn't in corn.