South Dakota Center for Farm/Ranch Management releases Crops Report 2017 report
Mitchell, S.D. — The widespread heat and lack of rain extending into to the middle portion of the growing season set up a challenge for crop performance. When rain did fall, it was too late for many, especially in central South Dakota. Other areas, especially east central South Dakota, received too much rain when the dry pattern changed to frequent showers and occasional violent storms with hail.
As per averages, the 2017 soybean crop was the most profitable of crops produced on farms enrolled in the South Dakota Center for Farm/Ranch Management program. This is the fifth consecutive year of this trend. Verified data is compiled from farms participating in the South Dakota Farm/Ranch Business Management program at Mitchell Technical Institute. Soybeans averaged a net return of $38 per acre, down from $96 per acre in 2016. The average yield of 44 bushels per acre vs 51 in 2016 was the biggest factor. The total cost of production for an acre of soybeans was $323 down from $341 in 2016.
On the fields included in the enterprise analysis, corn also had lower total costs per acre than the prior year; $434 per acre vs $480 in 2016. This somewhat offset the effect that slightly lower yields (143) and prices ($2.95) had on the gross revenue per acre. In 2017 the net return per acre was -$7 per acre compared to a -$19 per acre net return in 2016. “It may seem odd to get excited about ‘less’ loss, but it represents improvement,” said Will Walter, instructor at MTI.
Of note is the price/bushel. The $2.95 per bushel was calculated by an average of fall sales and ending inventory. According to Walter, “Corn prices have rallied since January 1, 2018, to the tune of 40-50 cents per bushel giving the producer an opportunity to show a profit on those same acres if some was carried over to be sold in 2018.” The high 20 percent return corn fields yielded 173 bushels per acre and the low 20 percent return corn fields only 114. Thus, gross income was the determining factor vs. cost comparison, as is often the case.
With a much smaller subset of data than corn and soybeans, the average return per acre of winter wheat was -$32 per acre. The average yield was only 56 bushels per acre vs. 84 in 2016. Alfalfa hay produced an average return of $10 per acre. Other crops, with lower instances, often are unique to a small group of operations. All crop reports can be viewed via the South Dakota Annual Report at www.sdcfrm.com.