Crop Market Update, October 28, 2013

Corn and soybean prices have remained steady throughout the week despite continued harvest progress. Strong demand both in the export market and domestically have helped to support soybean prices this week, but expectations of improved yields have kept prices in check. Soybean harvest is currently 77% complete, right at the 5-year average with 14% of the U.S. crop harvested in the last week. Corn has also held steady this week despite good harvest progress and expectations of a bumper crop. Strong demand as well as many producers expected to store their grain seems to have kept corn prices from falling too far in the face of a record crop. About 20% of the U.S. corn crop was harvested in the last week with 59% of the U.S. harvest complete and just 3% behind the 5-year average. While wheat prices have remained strong throughout the fall, excellent crop conditions and near normal planting progress have contributed to the recent bearish trend in wheat markets. The U.S. winter wheat crop is 86% planted, slightly ahead of the 5-year average and the crop is rated 65% good or excellent.

 

Futures Quotes (Contract) This Friday Last Friday % Change
Corn (Dec 2013) $4.40 $4.41 -0.23%
Soybeans (Nov 2013) $13.00 $12.91 0.70%
Cotton (Dec 2013) $79.08 $83.11 -4.85%
Wheat (Dec 2013) $6.90 $7.05 -2.13%
Rice (Nov 2013) $15.54 $15.29 1.64%
Source: Corn, soybean, wheat, and rice prices are from the CMEGroup; Cotton price is from the Intercontinental Exchange
Prices are $/bu for corn, soybeans and wheat, cents/pound for cotton, and $/cwt for rice

 

One more weekend to take advantage of the 2013 Fall Agritourism Season!

Join the fun! Find local agritourism operations registered with the Mississippi Agritourism Association by clicking on the pumpkins here http://mississippiagritourism.org/member_map.htm or using the list format.  Search your county for operations using the Mississippi Development Authority website: http://www.visitmississippi.org/agritourism.aspx.

Agritourism is the fastest growing sector in the tourism industry and is making a positive impact on rural economies in Mississippi. Demand for agritourism arises from urbanites looking for ways to experience the outdoors and learn about farming and the food supply. Agritourism is a popular way for families to connect to history and place and spend quality time together away from electronic devices. Supply of agritourism arises from agricultural producers adapting to changing economic realities.  Many find that devoting a small portion of acreage to agritourism efforts is a relatively profitable way to use their land.

In 2007 the US had 23,350 farms offering agritourism and outdoor activities which provided $566 million in annual revenues for farms. Between the 2002 and 2007 Census of Agriculture, income from agritourism increased 128 percent in Mississippi. In 2007, the average income per farm from agritourism was $16,000. It is estimated that current trends will increase, and, if so, the average agritourism income per farm in Mississippi will rise to $43,000 in 2013. The agritourism industry in Mississippi has a handful of large operations which boast between 30,000 and 90,000 visitors each year. However, most of the operations are much smaller and are in the start-up phase.

A two-year Limited Liability Law (LLL) passed in the Mississippi Legislature in 2012 and is expected to be codified in 2014. Many operations are expected to open due to passage of LLL which protects operators from any liability, provided there was no negligence on the part of the owner. In order to be covered, operators MUST be registered yearly: http://www.mdac.state.ms.us/programs/agritourism/index.html.

Contact Becky Smith (becky.smith@msstate.edu) for more information.

Cash/Share Rental Rates in Mississippi

Cash rental rates have trended upward throughout Mississippi in all four geographic/soil regions while share rental rates have remained relatively constant.  However, cash rental agreements have become more common relative to share contracts as the number of share contracts have dwindled according to surveys conducted by Mississippi State.

Rental rates for corn producers have seen rate increases of around 25% since 2008 with the exception of the Hills Region which was about the same in 2012 as in 2008. Soybean producers have seen more modest increases in cash rental rates during the same period with the exception of the lower delta with a rate increase of 21%. Generally cotton producers are paying higher rental rates as well, especially in the hills region where rates were 75% higher than those in 2008.

Year/Region

2005

2006

2007

2008

2009

2010

2011

2012

——Cash Rent Corn—–

Upper Delta

80.80

97.44

83.43

89.32

87.36

101.04

97.94

115.79

Lower Delta

70.19

89.23

85.73

95.95

116.82

111.19

112.31

118.46

Loam/ Lower Coastal

65.80

74.38

54.06

47.84

62.06

54.38

49.71

60.23

Hills Region

36.00

49.16

34.46

56.38

39.63

44.72

56.81

55.01

——% Share Rent   Corn——

Upper Delta

21.8

.

26.5

.

24.0

.

24.0

.

Lower Delta

.

20.0

25.0

20.0

23.3

.

20.0

20.0

Loam/ Lower Coastal

25.0

20.0

18.8

16.7

20.0

20.0

20.0

25.0

Hills Region

22.1

25.2

23.3

23.8

23.3

20.0

21.7

22.1

Year/Region

2005

2006

2007

2008

2009

2010

2011

2012

——Cash Rent Soy—–

Upper Delta

61.60

62.80

63.04

73.04

77.08

89.44

92.69

70.27

Lower Delta

58.87

69.36

77.58

80.62

90.34

91.94

78.06

97.62

Loam/ Lower Coastal

43.43

58.25

50.45

50.25

45.74

55.16

56.42

54.00

Hills Region

37.37

28.75

34.28

39.44

37.55

41.42

36.11

41.42

——% Share Rent   Soy——

Upper Delta

25

25

25

22

25

25

25

25

Lower Delta

.

.

.

25

25

23

20

25

Loam/ Lower Coastal

24

23

24

20

20

20

23

21

Hills Region

22

24

23

22

23

34

22

20

Year/Region

2005

2006

2007

2008

2009

2010

2011

2012

——Cash Rent   Cotton—–

Upper Delta

85.96

97.44

79.68

94.46

85.36

93.33

109.21

105.75

Lower Delta

83.41

89.23

88.88

100.00

106.84

106.95

116.92

120.62

Loam/ Lower Coastal

71.93

74.38

66.94

75.00

77.50

87.50

89.85

71.25

Hills Region

51.66

49.46

41.42

49.00

42.50

58.57

69.35

85.90

——% Share Rent   Cotton——

Upper Delta

25.00

0.00

21.66

20.00

25.00

22.50

.

23.33

Lower Delta

.

20.00

.

.

20.00

20.00

.

21.66

Loam/ Lower Coastal

23.00

20.00

20.00

22.00

21.11

21.11

21.66

21.66

Hills Region

23.88

25.20

18.85

0.00

25.00

25.00

20.00

20.00

corn cotton and soybeans 7 year

While commodity prices have declined in 2013.  Rental rates and land prices can be slow to react and expectations of higher prices in the future may continue upward pressure on prices or support rates from the previous year.