Indiana farmers expected to enjoy near-record income

Back to TopCommentsE-mailPrintBookmark and Share

Many Indiana farmers who had been worrying about a late summer drought are now looking forward to some extra spending money thanks to high grain prices, which a Purdue University farm analyst expects will boost the state's farm income about 25 percent this year.

Indiana's 2010 farm income should top $3 billion, about a half-billion dollars higher than last year and just below 2008's record of $3.2 billion, said Purdue agricultural economist Chris Hurt.

He said grain prices currently are "extraordinarily high" and being driven by strong global demand for American grains. Soybeans currently are priced at about $13 a bushel, with corn about $5.75 a bushel, Hurt said.

"The crop producers are excited. These are good times for crop incomes," he said.

U.S. Department of Agriculture crop production estimates released Tuesday show Indiana farmers are expected to harvest about 918.4 million bushels of corn and 266.5 million bushels of soybeans this year.

Indiana farmers are virtually done harvesting those crops following a drought that cut some yields but allowed producers to bring in crops at near-record prices this fall.

Hurt said the drought had a minimal impact on Indiana's crops because good weather allowed farmers to plant their fields early and then plentiful rain between May and July infused soils with moisture that sustained crops during the drought that followed.

Some farmers will spend part of the extra income they expect to get this year on big purchases such as farm equipment, reducing their debt or long-delayed projects, he said.

"When there's good income the barn gets painted that hasn't been painted in years. Or maybe they'll trade up their pickup truck," Hurt said.

But many farmers won't be able to fully capitalize on the current high grain prices because they sold part of their crop on advance contract at locked-in prices, said Mike Baise, strategic issue coordinator for Indiana Farm Bureau.

He said banks that loan farmers money to help plant crops in the spring typically encourage such contracts to increase the chances they'll be paid back.

"A lot of the farmers are using somebody else's money to put in the crop. It's placing a bet really, whether you want to gamble on the markets going up or down," Baise said.

Tom Gasper, who farms about 3,700 acres of corn and soybeans in south-central Indiana's Jennings County with two of his brothers, said they sold some of their crop on contract earlier this year before grain prices rose.

But they'll be able to sell the remainder at the current higher prices.

Gasper said the drought has cut his corn yields about 25 percent below average. He's expecting higher income this year, but said rising costs of fertilizer and of rented cropland will eat much of it up.

"Whatever extra money we get this year is going to go right back into the inflated fertilizer costs and the land costs for next year. The bulk of it will," he said.


Post a comment to this story

We reserve the right to remove any post that we feel is obscene, profane, vulgar, racist, sexually explicit, abusive, or hateful.
You are legally responsible for what you post and your anonymity is not guaranteed.
Posts that insult, defame, threaten, harass or abuse other readers or people mentioned in IBJ editorial content are also subject to removal. Please respect the privacy of individuals and refrain from posting personal information.
No solicitations, spamming or advertisements are allowed. Readers may post links to other informational websites that are relevant to the topic at hand, but please do not link to objectionable material.
We may remove messages that are unrelated to the topic, encourage illegal activity, use all capital letters or are unreadable.

Messages that are flagged by readers as objectionable will be reviewed and may or may not be removed. Please do not flag a post simply because you disagree with it.

Sponsored by

facebook - twitter on Facebook & Twitter

Follow on TwitterFollow IBJ on Facebook:
Follow on TwitterFollow IBJ's Tweets on these topics:
Subscribe to IBJ
  1. Looking at the two companies - in spite of their relative size to one another -- Ricker's image is (by all accounts) pretty solid and reputable. Their locations are clean, employees are friendly and the products they offer are reasonably priced. By contrast, BP locations are all over the place and their reputation is poor, especially when you consider this is the same "company" whose disastrous oil spill and their response was nothing short of irresponsible should tell you a lot. The fact you also have people who are experienced in franchising saying their system/strategy is flawed is a good indication that another "spill" has occurred and it's the AM-PM/Ricker's customers/company that are having to deal with it.

  2. Daniel Lilly - Glad to hear about your points and miles. Enjoy Wisconsin and Illinois. You don't care one whit about financial discipline, which is why you will blast the "GOP". Classic liberalism.

  3. Isn't the real reason the terrain? The planners under-estimated the undulating terrain, sink holes, karst features, etc. This portion of the route was flawed from the beginning.

  4. You thought no Indy was bad, how's no fans working out for you? THe IRl No direct competition and still no fans. Hey George Family, spend another billion dollars, that will fix it.

  5. I live downtown Indy and had to be in downtown Chicago for a meeting. In other words, I am the target demographic for this train. It leaves at 6:00-- early but doable. Then I saw it takes 5+ hours. No way. I drove. I'm sure I paid 3 to 5 times as much once you factor in gas, parking, and tolls, but it was reimbursed so not a factor for me. Any business traveler is going to take the option that gets there quickly and reliably... and leisure travelers are going to take the option that has a good schedule and promotional prices (i.e., Megabus). Indy to Chicago is the right distance (too short to fly but takes several hours to drive) that this train could be extremely successful even without subsidies, if they could figure out how to have several frequencies (at least 3x/day) and make the trip in a reasonable amount of time. For those who have never lived on the east coast-- Amtrak is the #1 choice for NY-DC and NY-Boston. They have the Acela service, it runs almost every hour, and it takes you from downtown to downtown. It beats driving and flying hands down. It is too bad that we cannot build something like this in the midwest, at least to connect the bigger cities.