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Rethink Corn Economics
Thursday, February 4, 2016 6:58AM CST


By Emily Unglesbee
DTN Staff Reporter

ROCKVILLE, Md. (DTN) -- Corn farmers looking to curb their losses this year should scrutinize two sizeable inputs: seeds and fertility.

Together, those two inputs cost Indiana farmers nearly as much as land does, according to numbers from Purdue's Center for Commercial Agriculture.

Farmers may mistake them for costs beyond their control, university agronomists Bob Nielsen and Jim Camberato and agricultural economists Michael Langemeier and Jim Mintert noted in a webinar sponsored by the center on Monday. Yet growers may find savings by revisiting common practices such as routine fertility applications, some nitrogen applications and packing corn fields with high populations of racehorse varieties stacked full of biotech traits, they concluded.

SEED SAVINGS

Nielsen has received many calls from farmers wondering if they can get away without biotech traits like Roundup Ready or Bt this year, he noted. His answer is yes, with several caveats.

"This is an opportunity to save a lot of money," he said. "But it needs to be done smartly. Traited hybrids are mostly either protecting against insect pests or allowing us to use herbicides like glufosinate or glyphosate."

Consider your pest problems carefully, he said. If you have light rootworm pressure that is controlled by crop rotation, maybe you can go without belowground Bt traits. If you are willing to scout more often and use insecticides and rigorous pre-emergence weed control, perhaps you can forgo aboveground Bt traits and Roundup Ready technology.

"If you back away from trait technology, you have to have a back-up strategy and be willing implement it," concluded Mintert.

Nielsen also pinpointed growers' tendency to plant a denser planting population than the ag economy can justify right now.

For example, for Indiana growers, the optimum planting rate is generally pegged at 32,000 plants per acre. Yet final stands anywhere between 29,000 and 35,000 will still produce "basically optimal yield," Nielsen pointed out. "Most farmers aim for the mid-30s or even low-30s, and we're saying if you aim for the high-20s, that is probably is the economic sweet spot at least for corn in Indiana."

While those numbers are specific to Indiana growers, it is a general truth of corn production that "optimal economic planting rates are several thousand less than optimum agronomic planting rates," he added.

Finally, pick your hybrids with a new mindset, Nielsen suggested. "It's not just about yield potential," he said of the hybrid selection process. "It's also about the ability of hybrids to consistently yield well no matter the growing conditions. We are in a time period of extreme climatic variability. So try to find hybrids with a wide array of tolerance to stress -- hot, cold, wet and dry."

Because corn hybrids turn over fairly quickly, growers can't always access more than a few years of data on any given hybrid. So widen your variety trial search beyond your region and state to see how a hybrid performs in a range of growing conditions, Nielsen said. "Look for hybrids that always end up in the upper 10% of a wide variety of trials -- company and university trials, across geographies -- even if they don't win trials outright. That tells me they are pretty stress tolerant."

After you've identified these hardy hybrids, narrow your search by looking for the ones that have the disease and insect package that best fits your growing conditions to save on insecticide and fungicide treatments, he added.

FERTILITY RECALCULATIONS

Try to shift to a risk-management mindset when planning nitrogen applications, Camberato said. His research has shown that farmers are most likely to lose nitrogen from fall applications, early spring anhydrous or liquid applications and surface-applied urea applications.

"We estimate on average, fall applications will lose 15%, and early spring maybe 10%," he said. "One practice to take better advantage of this is to put nitrogen on closer to planting time or even in-season."

Warm falls followed by wet springs, which we may experience this year, make fall-applied fields especially prone to nitrogen loss. "Looking ahead, it may be too late for fall applications this year of course, but for the 2017 crop, stay away from fall nitrogen applications," Mintert suggested.

Don't be too quick to dismiss in-season application as a hopeless rescue option either, Camberato said. "We've been surprised at how much potential the corn crop has to take up nitrogen late in the year and respond by increasing yield if the crop is healthy and you have a favorable grainfill period," he said of his research. "We've gotten 110-bushel yield increases with as late as V15 applications on corn that eventually makes 225 bushels."

Remember that corn's yield response to nitrogen is highest when nitrogen is severely limited and slows as you approach the optimal nitrogen rate, Camberato added. "If you're shooting for maximum yield [with nitrogen applications], you may be losing money on the nitrogen and then have to handle and dry more grain, which actually costs you more to produce than it's worth," he said.

Finally, 2016 might be a good year for Indiana farmers to drop a phosphorus application, he added. If a recent soil test shows levels within the maintenance range (30 to 50 parts per million), don't add any this year, he said.

"Typically, in the maintenance range, the recommendation is to replace crop removal, but there is very little probability of a yield response to the fertilizer applied that year," he said. "That recommendation was built for years of profit."

Don't worry that your levels will plummet from one year of restraint, he added. "To change soil levels just 15 ppm, you have to remove 300 pounds of P2O5 [phosphate]," he explained. "A 200-bushel corn crop removes about 75 pounds per acre of P2O5, so that's several years of crop removal for you to move out of the maintenance range."

For more information on these recommendations, see the slideshow from the webinar, Reducing Corn Production Costs, here: http://bit.ly/….

Emily Unglesbee can be reached at emily.unglesbee@dtn.com

Follow Emily Unglesbee on Twitter @Emily_Unglesbee

(PS/AG/SK)


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