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Farmers rally in Ottawa to seek billions in aid

Someone who raises corn (wheat, cotton, etc.) on a thousand acres is going to make more via the combined income from the harvest profits and subsidy payment than they are turning it in to CRP (and leaving it idle).

Ie, if someone wants to get on a gov't program, CRP isn't as profitable as a commodity subsidy.
 
theHiredMansWife said:
Someone who raises corn (wheat, cotton, etc.) on a thousand acres is going to make more via the combined income from the harvest profits and subsidy payment than they are turning it in to CRP.
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I would disagree with that. CRP is a guaranteed profit. It's not much, but there is virtually no input to it and a check from Uncle. To say there is more money from farming would mean there would also have to be a guaranteed profit, and a larger one to boot. Cash prices with LDP's do not guarantee a profit.
 
Sandhusker said:
theHiredMansWife said:
Someone who raises corn (wheat, cotton, etc.) on a thousand acres is going to make more via the combined income from the harvest profits and subsidy payment than they are turning it in to CRP.
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I would disagree with that. CRP is a guaranteed profit. It's not much, but there is virtually no input to it and a check from Uncle. To say there is more money from farming would mean there would also have to be a guaranteed profit, and a larger one to boot. Cash prices with LDP's do not guarantee a profit.
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That is only if you have no opportunity cost for the money tied up in land. At least it reduces your potential downside.

I have sat down in some state committees where the old ASCS (agriculture soil conservation services) paid farmers for set aside land and found out they were still growing on the acreage. Nothing happened to the farmers because they were "good political supporters".

The world doesn't always work as we think it should or the way we believe it does.
 
theHiredMansWife said:
I would have to see numbers to believe that to be true most of the time, I guess. :wink:
Because most folks I know are making more from their subsidy/harvest income in the long run than they are CRP when compared acre to acre.
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I think generally you are correct. It's just certainly not a given. I just want to make sure these Canucks have correct information. :lol:
 
I believe crp only idles the poorest land also. Land with erosion problems etc. Your land has to qualify. Its getting tougher and a lot of acres are coming out of crp shortly.
 
Sandhusker said:
theHiredMansWife said:
I would have to see numbers to believe that to be true most of the time, I guess. :wink:
Because most folks I know are making more from their subsidy/harvest income in the long run than they are CRP when compared acre to acre.
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I think generally you are correct. It's just certainly not a given. I just want to make sure these Canucks have correct information. :lol:
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Guess we will have to get it from someone other then you. :wink: :cowboy:

we can read all about the payment in the EWG web site.
 
CRP is set up by a bid system in many counties. The gov't agency decides how many acres they would like to idle in that area then put out tenders.

If they need 5000 acres and only 5000 acres are offered, they get it at whatever they have bid. I know of some who got $35 an acre some who got $60. It is annual until the end of the contract period.

You can almost buy land is some areas just with a CRP contract.

As for $1.95 garanteed price on corn, at 350 bushel average yield it sure pencils well.
 
Jason said:
CRP is set up by a bid system in many counties. The gov't agency decides how many acres they would like to idle in that area then put out tenders.

If they need 5000 acres and only 5000 acres are offered, they get it at whatever they have bid. I know of some who got $35 an acre some who got $60. It is annual until the end of the contract period.

You can almost buy land is some areas just with a CRP contract.

As for $1.95 garanteed price on corn, at 350 bushel average yield it sure pencils well.
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At 400 bushels per acre it pencils even better. :roll:
 
Jason...As for $1.95 garanteed price on corn, at 350 bushel average yield it sure pencils well.

Yeah right. Is that the average in your neighborhood?

COST TO PRODUCE CORN AND SOYBEANS IN ILLINOIS—2004

In 2004 the total of all economic costs per acre for growing corn in Illinois averaged $444 in the northern section, $434 in the central section for farmland with "high" soil ratings, $411 in the central section for farmland with "low" soil ratings, and $374 in the southern section. Soybean costs per acre were $349, $343, $319 and $289, respectively (see Table 1). Costs were lower in the southern Illinois primarily because of lower land costs. The total of all economic costs per bushel in the different sections of the state ranged from $2.20 to $2.40 for corn and from $5.78 to $6.71 for soybeans. Variations in this cost were related to weather, yields, and land quality.

Jason if corn is such a good guaranteed crop why are farmers not going to plant as many acres this year as they have been? Could it be the cost of production is getting so high that they are moving to other crops like soybeans?

Quote...Corn growers intend to plant 78.0 million acres of corn for all purposes in 2006, which is also 4% below 2004, according to the report. If this year's prediction comes true, it will be the least amount of acreage planted since 2001 when 75.7 million acres were planted for all purposes.
 
and people on here call others on wellfare lazy.I have heard this from many on this site/"if you cant make it quit,or get a second job" why dont you say that to the farmer too?Or are subsidies okay and not considered a handout....maybe not having a new truck and tractor every year is that important,or maybe it is? I guess i just dont understand what is an ok handout and what isnt.
 
You can't go broke with your land in CRP. You can by farming it, even with substities. My land won't qualify for CRP, but then I don't farm any more. Surely Jason must be sarcastic if he talks about 350 bushel per acre corn yields and $35 to $60 land. If not I'll quit reading his posts.

As far as government assistance programs, through the years I have received more from livestock assistant programs than I have ever received from farm substities. I guess the grass always looks greener on the other side of the fence.

I don't like government programs. I hated the old soil bank, that was when I was trying to get started. CRp pays better, so is even worse. Most farm programs are designed to alway have a surplus so prices remain low, but just enough to encourage the farmer and rancher to stay in business. They want to tell you what to plant, how much you can plant, and the price they want you to receive.
 
nonothing said:
and people on here call others on wellfare lazy.I have heard this from many on this site/"if you cant make it quit,or get a second job" why dont you say that to the farmer too?Or are subsidies okay and not considered a handout....maybe not having a new truck and tractor every year is that important,or maybe it is? I guess i just dont understand what is an ok handout and what isnt.
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Anyone buying groceries is getting subsidies, the cheap food program. So I guess lots of finger pointers are on welfare. I don't care for any government programs, but then again they need to stay out of the controling of prices for cheap food.
 
It is doubtful the CRP program will end. Recently, Sportsmens groups have pushed it because of the improved wildlife habitat. Some is linked to walk-in hunting areas leased by the Game, Fish and Parks in SD, with a little payment going to the farmer on top of his CRP payment.

BTW, the farmer does have to establish and maintain grass or other cover crop on CRP land. Maybe trees qualify, not sure about that. It is very costly. We did have some land that qualified. It was a mixed blessing Very costly to get native grasses started in this area, especially with drougth so frequent. We were relieved when it came out of the program.

We do not like subsidies, etc., yet with other ranchers participating, that is an advantage costly to refuse. Makes competition difficult if we don't partake of the programs when we all have to pay the taxes to support those programs. I can see it better in times of drought or other natural disaster.

Say, Clarence, what is that livestock assistance you mentioned? The only thing we have ever seen on that is a bit of feed assistance during severe drought. Is that what you refer to, or is it something else?

ranch hand, you surely got it right on the groceries being subsidized by farm subsidies. Actually seems like consumers can afford the luxuries of life because they pay such a small part of their incomes for food. Then there are all the social welfare programs paid for from the Agriculture Department. When the public sees the budget numbers, they assume it is all going to farmers. Does anyone know the split there? It seems we have heard it is more than half to welfare programs, other than for farmers.

Is it a real mess, or would there be just large corporate farms and very high food costs if we didn't have these programs?

MRJ
 
Tommy, ranch hand and MRJ, you have great posts here. As far as livestock subsidies, the only thing I have seen many years ago was you could harvest your cover crop (I believe) on CRP land due to a drought. We called it diverted acres back then. The county would give the OK about August. We didn't have diverted acres but we would pay a farmer so much per acre to get the feed source. Amen to the cheap food policy. All those that complain a farmer is guaranteed 1.90 for their corn all the time they have all the luxury items they could ever want, makes me fume. It is a crazy chain of problems. If a farmer gets paid what his product is worth then the price in the store goes up. If it goes up then the consumer doesn't have enough to buy all the luxury items and then that aspect of business hurts. I guess prices have increased but the farmers share of the pie has decreased. The subsidy programs might sound like they help the farmer. but with them the land value and rent has all been factored higher also. I'll admit I don't know what the best way is to change things but I do know when part of the economic circle gets broken all are affected in some way.
 
Go back to the numbers Tommy posted. They include LAND VALUES as a cost of growing corn. Granted it has to be adressed at some point, but if you are to compare apples to apples, figure your acres needed per pound of calf sold as well.

Other discussions on Ranchers.net have shown the number 1 thing holding us all back from expansion is land costs. Those land costs are not being driven up by agricultural interests, but people outside ag that want to develop or live on that land.

The options become clear then that ag as it has been is unsustainable. Costs have to come down or productivity has to increase. Costs of actual inputs isn't coming down. Many have cut cost of production by growing more on what they have, or finding a better return for a value added product.

Organic or grass fed is gaining popularity but is currently not viable for very large scale production in all forms of ag. The returns are also questionable in some areas.

The result is an unstable sector of the economy. Economic realities will continue to force consolidation and or smaller ag interests with other income streams. One thing is garanteed only the best managed will survive.
 
I believe the long term average corn yield is close to 170 bu/acre in good corn growing areas. That 350bu corn is usually a small sellected area in Iowa that gets into those Glossy Case IH magazines :wink: Perhaps Tommy could confirm those numbers.
 
cowzilla you are right. 170-225 bu we see here. Average is more in the 170-180. I read an article on the guy that had the best yield. He spent lots of money on extra fertilizer and irrigation.
 
Feeder

What is the going price for corn down there? I wonder if the guy that pushed all of those input costs towards that corn crop for high yields broke even? :???:
 

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