Western Ohio Cropland Values and Cash Rents 2020-21

by: Barry Ward, Leader, Production Business Management, Director, OSU Income Tax Schools, OSU Extension, Agriculture & Natural Resources

 Ohio cropland varies significantly in its production capabilities and, consequently, cropland values and cash rents vary widely throughout the state. Generally, western Ohio cropland values and cash rents differ from much of southern and eastern Ohio cropland values and cash rents. The primary factors affecting these values and rents are land productivity and potential crop return, and the variability of those crop returns. Soils, fertility and drainage/irrigation capabilities are primary factors that most influence land productivity, crop return and variability of those crop returns.

Other factors impacting land values and cash rents may include field size and shape, field accessibility, market access, local market prices, field perimeter characteristics and potential for wildlife damage, buildings and grain storage, previous tillage system and crops, tolerant/resistant weed populations, USDA Program Yields, population density, and competition for the cropland in a region. Factors specific to cash rental rates may include services provided by the operator and specific conditions of the lease.

The Western Ohio Cropland Values and Cash Rents study was conducted from January through April in 2021. The opinion-based study surveyed professionals with a knowledge of Ohio’s cropland values and rental rates. Professionals surveyed were rural appraisers, agricultural lenders, professional farm managers, ag business professionals, OSU Extension educators, farmers, landowners, and Farm Service Agency personnel.

The study results are based on 94 surveys. Respondents were asked to group their estimates based on three land quality classes: average, top, and poor. Within each land-quality class, respondents were asked to estimate average corn and soybean yields for a five-year period based on typical farming practices. Survey respondents were also asked to estimate current bare cropland values and cash rents negotiated in the current or recent year for each land-quality class. Survey results are summarized below for western Ohio with regional summaries (subsets of western Ohio) for northwest Ohio and southwest Ohio.

According to the Western Ohio Cropland Values and Cash Rents Survey, cropland values in western Ohio are expected to increase in 2021 by 3.8 to 5.3 percent depending on the region and land class. Cash rents are expected to increase from 3.6 to 3.9 percent depending on the region and land class.

For the complete survey research summary go to the OSU Extension Farm Office website at:

https://farmoffice.osu.edu/farm-management-tools/farm-management-publications/cash-rents

 

 

 

 

What is the WASDE Report and Why is It Important?

by: Chris Zoller, Extension Educator, ANR, Tuscarawas County

Click here for PDF of this article

The World Agricultural Supply and Demand Estimates (WASDE) report is prepared monthly by the Interagency Commodity Estimates Committees (ICECs) which are chaired by representatives from the Agricultural Marketing Service, Economic Research Service, Farm Service Agency, and Foreign Agricultural Service.  The National Agricultural Statistics Service provides data about U.S. production and each ICEC (one for each of nine commodities) compile and analyze data from U.S. and foreign sources to produce the report.

The WASDE report is prepared under very tight security in a “lock-up” area inside a USDA building.  On the day of the report release, doors in this room are secured, window shades are closed, and telephone and internet communication blocked!  Analysts attending the meeting must present their credentials to a guard before entering to finalize the report.  The WASDE report is released at 12:00 noon Eastern time, and not a minute sooner.

Who Provides Information?

The Interagency Commodity Estimates Committees described earlier use information from a variety of USDA sources.  The National Agricultural Statistics Service provides data related to U.S. crop and livestock production.  The USDA Foreign Agricultural Service, official data from foreign governments, satellite imagery, and weather data are also provided about foreign crop and livestock production and use.

All of this information is reviewed by ICEC members with broad expertise and perspective.  To arrive at a consensus about the forecasts, the committee considers alternate assessments of domestic and foreign supply and use.

Commodity Balance Sheets

Do you remember back to your introductory economics class?  One of the basic principles taught was supply and demand (see graph below).  Those who develop the WASDE report use information to provide the agricultural industry with a baseline for supply and demand of given commodities.  If a large supply is anticipated (think of it as a bumper yield), but domestic or foreign demand is not high, the result is lower prices. On the flip side, a poor harvest (lower quantity) combined with increased demand results in increasing commodity prices.  We have seen commodity markets move up or down within minutes of a WASDE report being released.

A balance sheet for U.S. and world wheat, rice, coarse grains, oilseeds, and cotton is provided.  Coarse grains include corn, barley, sorghum, and oats).  Oilseeds include soybeans, rapeseed, and palm).  The U.S. also reports sugar, meat, poultry, eggs, and milk on the balance sheet.   Separate estimates are provided for components of supply and demand and domestic use is divided into major categories (for example, corn for feed and corn for ethanol use).

Of interest to many is the reported season-average farm price for farm commodities.  Price forecasts are made by experts who carefully analyze the supply and demand sides of the balance sheet, along with commodity models, and in-depth research of domestic and international issues.

Why is the WASDE Important?

Agriculture operates in a global market and supply and demand are constantly changing.  A monthly balance sheet of major commodities provides farmers, industry professionals, and others a current source of information.

Not everyone agrees with every number reported in each WASDE, but everyone should feel confident that a tremendous amount of research and time are invested to provide the most accurate report possible.

Where Can I Read the WASDE Reports?

Current and historical (since 1974) WASDE reports are available here: https://www.usda.gov/oce/commodity/wasde.  These reports are approximately 40 pages in length, but an approximate five-page summary of coarse grains, oilseeds, and cotton is provided at the beginning of the report.  Detailed data tables accompany the report.

Sources:

WASDE FAQs, United States Department of Agriculture, https://www.usda.gov/oce/commodity-markets/wasde/faqs

WASDE Report, United States Department of Agriculture, https://www.usda.gov/oce/commodity/wasde

 

 

Champaign County Landowner Club Created

by: Amanda Douridas

Land is an expensive and important investment that is often handed down through generations. As such, it should be cared for and maintained to remain profitable for future generations. Whether it is a change in regulations or a loss of knowledge with the loss of a generation, it can be difficult for landowners to stay on top of everything.

To help, OSU Extension and Farm Bureau in Champaign County have started the Landowner Club designed to help farmland owners understand critical conservation and farm management issues. Topics will range in expertise level from beginner to advanced, so landowners of all experience levels can gain knowledge, skills and confidence to implement, or talk with tenants about, farming and conservation practices.

The Landowner Club will meet on the 4th Thursday of the month from 8-9am (with a few exceptions) in the Champaign County Community Center. The kick-off event is June 24. Peggy Kirk Hall, Ag Law Specialist, will discuss the noxious weed law and landowner liability. Future topics can be found on the registration site.

The series is free to Farm Bureau members and $5 for non-members. A light breakfast will be served. Register online at http://go.osu.edu/Landowners.

The club organizers are interested in learning what topics are important to landowners, so please send your suggestions to Amanda Douridas at Douridas.9@osu.edu or bring them with you to a meeting.

Farm Office Live to Analyze USDA’s Pandemic Assistance for Producers Initiative

By Barry Ward, David Marrison, Peggy Hall, Dianne Shoemaker and Julie Strawser – Ohio State University Extension

April’s “Farm Office Live” will focus on details of the USDA’s Pandemic Assistance for Producers” initiative announced on March 24, 2021. Changes were made in effort to reach a greater share of farming operations and improve USDA pandemic assistance.

During the webinar, we will be sharing details about the pandemic initiative and discussing some of the changes made to the Coronavirus Food Assistance Program (CFAP).  Our Farm Office Team will also provide a legislative update and discuss changes to the Paycheck Protection Program and Employee Retention Credits. They will also be on hand to answer your questions and address any related issues.

Two live sessions will be offered on Wednesday, April 7, from 7:00 – 8:30 p.m. and again on Friday, April 9, from 10:00 – 11:30 a.m. A replay will be available on the Farm Office website if you cannot attend the live event.

Farm Office Live is a webinar series addressing the latest outlook and updates on ag law, farm management, ag economics, farm business analysis and other related issues. It is presented by the faculty and educators with the College of Food, Agricultural and Environmental Sciences at The Ohio State University.

To register or view past recordings, visit https://go.osu.edu/farmofficelive.

For more information or to submit a topic for discussion, email Julie Strawser at strawser.35@osu.edu or call the Farm Office at 614-292-2433.

USDA Announces Pandemic Assistance to Farmers

by: Chris Zoller, Extension Educator, ANR, Tuscarawas County

Source of Information: https://www.farmers.gov/

The United States Department of Agriculture (USDA) announced this week it is establishing new programs and efforts to provide financial assistance to farmers negatively impacted by the Coronavirus pandemic.

The new program is called the USDA Pandemic Assistance for Producers and is intended to reach a broader representation of producers than previous COVID-19 aid programs.  The program will place a greater emphasis on small and socially disadvantaged producers, specialty crop and organic producers, timber harvesting, as well as support for the food supply chain and producers of renewable fuels.

The USDA Pandemic Assistance for Producers program administered by the Farm Service Agency (FSA) includes four parts.  Details below were provided in a news release from USDA.

Part 1:

USDA will dedicate at least $6 billion to develop a number of new programs or modify existing proposals using discretionary funding from the Consolidated Appropriations Act and other coronavirus funding that went unspent by the previous administration. Where rulemaking is required, it will commence this spring. These efforts will include assistance for:

  • Dairy farmers through the Dairy Donation Program or other means:
  • Euthanized livestock and poultry;
  • Biofuels;
  • Specialty crops, beginning farmers, local, urban and organic farms;
  • Costs for organic certification or to continue or add conservation activities
  • Other possible expansion and corrections to CFAP that were not part of today’s announcement such as to support dairy or other livestock producers;
  • Timber harvesting and hauling;
  • Personal Protective Equipment (PPE) and other protective measures for food and farm workers and specialty crop and seafood producers, processors and distributors;
  • Improving the resilience of the food supply chain, including assistance to meat and poultry operations to facilitate interstate shipment;
  • Developing infrastructure to support donation and distribution of perishable commodities, including food donation and distribution through farm-to-school, restaurants or other community organizations; and
  • Reducing food waste.

Part 2:

USDA expects to begin investing approximately $500 million in expedited assistance through several existing programs this spring, with most by April 30. This new assistance includes:

  • $100 million in additional funding for the Specialty Crop Block Grant Program, administered by the Agricultural Marketing Service (AMS), which enhances the competitiveness of fruits, vegetables, tree nuts, dried fruits, horticulture, and nursery crops.
  • $75 million in additional funding for the Farmers Opportunities Training and Outreach program, administered by the National Institute of Food and Agriculture (NIFA) and the Office of Partnerships and Public Engagement, which encourages and assists socially disadvantaged, veteran, and beginning farmers and ranchers in the ownership and operation of farms and ranches.
  • $100 million in additional funding for the Local Agricultural Marketing Program, administered by the AMS and Rural Development, which supports the development, coordination and expansion of direct producer-to-consumer marketing, local and regional food markets and enterprises and value-added agricultural products.
  • $75 million in additional funding for the Gus Schumacher Nutrition Incentive Program, administered by the NIFA, which provides funding opportunities to conduct and evaluate projects providing incentives to increase the purchase of fruits and vegetables by low-income consumers
  • $20 million for the Animal and Plant Health Inspection Service to improve and maintain animal disease prevention and response capacity, including the National Animal Health Laboratory Network.
  • $20 million for the Agricultural Research Service to work collaboratively with Texas A&M on the critical intersection between responsive agriculture, food production, and human nutrition and health.
  • $28 million for NIFA to provide grants to state departments of agriculture to expand or sustain existing farm stress assistance programs.
  • Approximately $80 million in additional payments to domestic users of upland and extra-long staple cotton based on a formula set in the Consolidated Appropriations Act, 2021 that USDA plans to deliver through the Economic Adjustment Assistance for Textile Mills program.

Part 3:

The Consolidated Appropriations Act, 2021, enacted December 2020 requires FSA to make certain payments to producers according to a mandated formula. USDA is now expediting these provisions because there is no discretion involved in interpreting such directives, they are self-enacting.

  • An increase in CFAP 1 payment rates for cattle. Cattle producers with approved CFAP 1 applications will automatically receive these payments beginning in April. Information on the additional payment rates for cattle can be found on farmers.gov/cfap. Eligible producers do not need to submit new applications, since payments are based on previously approved CFAP 1 applications. USDA estimates additional payments of more than $1.1 billion to more than 410,000 producers, according to the mandated formula.
  • Additional CFAP assistance of $20 per acre for producers of eligible crops identified as CFAP 2 flat-rate or price-trigger crops beginning in April. This includes alfalfa, corn, cotton, hemp, peanuts, rice, sorghum, soybeans, sugar beets and wheat, among other crops. FSA will automatically issue payments to eligible price trigger and flat-rate crop producers based on the eligible acres included on their CFAP 2 applications. Eligible producers do not need to submit a new CFAP 2 application. For a list of all eligible row-crops, visit farmers.gov/cfap. USDA estimates additional payments of more than $4.5 billion to more than 560,000 producers, according to the mandated formula.
  • USDA will finalize routine decisions and minor formula adjustments on applications and begin processing payments for certain applications filed as part of the CFAP Additional Assistance program in the following categories:
    • Applications filed for pullets and turfgrass sod;
    • A formula correction for row-crop producer applications to allow producers with a non-Actual Production History (APH) insurance policy to use 100% of the 2019 Agriculture Risk Coverage-County Option (ARC-CO) benchmark yield in the calculation;
    • Sales commodity applications revised to include insurance indemnities, Noninsured Crop Disaster Assistance Program payments, and Wildfire and Hurricane Indemnity Program Plus payments, as required by statute; and
    • Additional payments for swine producers and contract growers under CFAP Additional Assistance remain on hold and are likely to require modifications to the regulation as part of the broader evaluation and future assistance; however, FSA will continue to accept applications from interested producers.

Part 4:

USDA will re-open sign-up for of CFAP 2 for at least 60 days beginning on April 5, 2021.

  • FSA has committed at least $2.5 million to establish partnerships and direct outreach efforts intended to improve outreach for CFAP 2 and will cooperate with grassroots organizations with strong connections to socially disadvantaged communities to ensure they are informed and aware of the application process.

Summary

Applications for this program will open on April 5th.  Anyone interested in additional information about the USDA Pandemic Assistance to Producers program is encouraged to see https://www.farmers.gov/pandemic-assistance/cfap or their local FSA office.

Farm Office Live Continues!

by: Barry Ward, David Marrison, Peggy Hall, Dianne Shoemaker – Ohio State University Extension

“Farm Office Live” continues this winter as an opportunity for you to get the latest outlook and updates on ag law, farm management, ag economics, farm business analysis and other related issues from faculty and educators with the College of Food, Agricultural and Environmental Sciences at The Ohio State University.

Each Farm Office Live begins with presentations on select ag law and farm management topics from our specialists followed by open discussions and a Q&A session. Viewers can attend “Farm Office Live” online each month on Wednesday evening or Friday morning, or can catch a recording of each program.

The full slate of offerings remaining for this winter are:

  • March 10th 7:00 – 8:30 pm
  • March 12th 10:00 – 11:30 am
  • April 7th 7:00 – 8:30 pm
  • April 9th 10:00 – 11:30 am

Topics to be addressed in March include:

  • Coronavirus Food Assistance Program (CFAP)
  • Proposed Stimulus Legislation
  • General Legislative Update
  • Ohio Farm Business Analysis – A Look at Crops
  • Crop Budget & Rental Rates

To register or view past recordings, visit https://go.osu.edu/farmofficelive

For more information or to submit a topic for discussion, email Julie Strawser at strawser.35@osu.edu or call the farm office at 614-292-2433. We look forward to you joining us!

Corn, Soybean and Wheat Enterprise Budgets – Projected Returns for 2021 Increasing Fertilizer Prices May Force Tough Decisions

by: Barry Ward, Leader, Production Business Management & John Barker, Extension Educator, Agriculture & Amos Innovative Program, Knox County.  College of Food, Agricultural and Environmental Sciences & Ohio State University Extension

The profit margin outlook for corn, soybeans and wheat is relatively positive as planting season approaches. Prices of all three of our main commodity crops have moved higher since last summer and forward prices for this fall are currently at levels high enough to project positive returns for 2021 crop production. Recent increases in fertilizer prices have negatively affected projected returns. Higher crop insurance costs as well as moderately higher energy costs relative to last year will also add to overall costs for 2021.

Production costs for Ohio field crops are forecast to be modestly higher compared to last year with higher fertilizer, fuel and crop insurance expenses. Variable costs for corn in Ohio for 2021 are projected to range from $386 to $470 per acre depending on land productivity. Variable costs for 2021 Ohio soybeans are projected to range from $216 to $242 per acre. Wheat variable expenses for 2021 are projected to range from $166 to $198 per acre.

Returns (excluding government payments) will likely be higher for many producers depending on price movement throughout the rest of the growing year. Grain prices currently used as assumptions in the 2021 crop enterprise budgets are $4.30/bushel for corn, $11.55/bushel for soybeans and $6.25/bushel for wheat. Projected returns above variable costs (contribution margin) range from $216 to $434 per acre for corn and $284 to $509 per acre for soybeans. Projected returns above variable costs for wheat range from $193 to $342 per acre. As a reminder, fixed costs (overhead) must be paid from these returns above variable costs. Fixed costs include machinery ownership costs, land costs including rent and payment for owner operator labor and management including other unpaid family labor.

Fertilizer prices continue to increase.  If you have not checked fertilizer prices lately, be prepared for some sticker shock. Producers with some fertilizer purchased and stored or pre-priced prior to recent price increases will likely see a healthier bottom line this upcoming crop year.

Those with little or no fertilizer pre-purchased and stored or pre-priced may want to consider using P and K buildup to furnish crop needs this year in anticipation of possibly lower prices in the future.  Now may be a good time review your fertilizer plans as you are considering how to best utilize your financial resources in 2021.

Use realistic yield goals.  Yield goals vary by field.  Each field has unique characteristics that can impact yield.

Utilize crop removal rates to determine crop nutrient needs.  Crop removal rates can be found in the new Tri-State Fertilizer Recommendations for Corn, Soybeans, Wheat, and Alfalfa (Tables 15 and 16), available at your local Extension Office.

Start with a recent soil test.  If your soil test levels are in the maintenance range or higher, 2021 may be a good year to “borrow” from your soil nutrient bank.

As an example, a 150-bushel corn crop will remove about 55 pounds of P2O5 per acre in the harvested grain.  This would result in a reduction in the soil test level of approximately 3 ppm.

Current budget analyses indicates favorable returns for soybeans compared to corn but crop price change and harvest yields may change this outcome. These projections are based on OSU Extension Ohio Crop Enterprise Budgets. Newly updated Enterprise Budgets for 2021 have been completed and posted to the Farm Office website: https://farmoffice.osu.edu/farm-mgt-tools/farm-budgets

 

 

 

 

 

 

Considerations of a Flexible Lease Arrangement

by: Chris Zoller, Extension Educator, ANR, Tuscarawas County, Barry Ward, Leader, Production Business Economics, Ohio State University Extension &  Mike Estadt, Extension Educator, ANR, Pickaway County

Thousands of Ohio crop acres are rented from landowners by farmers.  While the most common is likely a cash agreement, the flexible lease may be worthy of consideration for some farmers.  This article will provide a broad overview of the flexible lease option, including advantages, disadvantages, and structure.

The information provided here is only a summary from the Fixed and Flexible Cash Rental Arrangements for Your Farm published by the North Central Extension Farm Management Committee.  Anyone interested in learning more about flexible leasing arrangements is encouraged to read more about this topic at this site: https://aglease101.org/wp-content/uploads/2020/10/NCFMEC-01.pdf.

What is a Flexible Lease?

Because of uncertainties with prices, yields, and input costs, some farmers and landowners are apprehensive about entering into a fixed long-term cash rental arrangement.  From the perspective of the farmer, the concerns include poor yields, commodity price declines, or sharp increases to input prices might impact cash flow if there is a long-term fixed arrangement.  In times like we are experiencing now, landowners want to capitalize on high commodity prices or high yields.

Therefore, the operator and landowner may turn to the use of a flexible cash rent of one kind or another. The idea of a flexible cash rent usually pertains only to the rent charged for cropland.

Advantage of Flexible Leases

  • Flexible cash rent enables the landowner to share in the additional income that results from unexpected increases in the prices of crops considered in the rent-adjustment clause. If the cash rent also is flexed for changes in yields, the landowner will benefit from above-normal yields regardless of the cause.
  • For the operator, risk is reduced. Cash-rent expense is lower if crop prices or yields are less than normal.
  • Calculating flexible cash rent requires more communication from both parties.

Disadvantages of Flexible Leases

  • For the landowner, flexible cash rent increases risk.
  • Windfall profits that may be realized by the operator from unexpected price increases are reduced.
  • If cash rent is flexed according to yield, the landowner becomes more concerned with the level of crop yields as well as the accuracy of reported yields. Yields must be verifiable and segregated for each land unit in the lease.
  • If cash rent is flexed according to yield, the operator may give up part of the benefits from higher yields resulting from managerial input, thus possibly reducing incentives to maximize profits.
  • Calculating flexible cash rent requires more management from both parties. There must be agreement on how to verify the factors that are used to set the rent each year.

Methods of Flexible Leasing Arrangements

Crop Price Only

Rents that flex only on price increase risk substantially for operators. A short crop that leads to higher prices and higher rent may leave the operator with less ability to pay.

Yield Only

With some commodities crop yields are highly uncertain. In other cases, the crop that is grown may only be fed to livestock, so no relevant market price exists. In such cases producers may prefer to negotiate a flexible lease agreement that bases the annual rent solely on the actual yield achieved.

Flex for Price and Yield

This method requires the operator and landowner to agree on a base cash rent tied to a base yield (average or expected yield) and a base expected price for each crop being considered. If only one crop is grown, this is the only crop considered. If several crops are grown and all are considered equally important, all crops may be considered in determining the current year’s cash rent.

Flex for Change in Cost of Inputs

The cost of variable inputs can change significantly from year to year and cause large swings in profitability. Incorporating a factor that reflects a ratio of the base year’s cost of inputs divided by the current year’s cost of inputs will help stabilize the bottom line for operators.

Put the Agreement in Writing

If it is decided to use some form of flexible cash rent (or any form of rental agreement), the details of how the rent will be determined should be clearly specified in a written lease agreement.

Additional information about written farmland leases is available from Ohio State University Extension at: https://farmoffice.osu.edu/sites/aglaw/files/site-library/Farm%20Lease%20Checklist%20law%20bulletin.pdf

Sources

Fixed and Flexible Cash Rental Arrangements for Your Farm, North Central Farm Management Extension Committee, https://aglease101.org/wp-content/uploads/2020/10/NCFMEC-01.pdf

What’s in Your Farmland Lease?  Ohio State University Extension Law Bulletin, https://farmoffice.osu.edu/sites/aglaw/files/site-library/Farm%20Lease%20Checklist%20law%20bulletin.pdf

Lady Landowners Leaving a Legacy Series 

by: Amanda Douridas and Amanda Bennett, OSU Extension

Land is an expensive and important investment that is often handed down through generations. As such, it should be cared for and maintained to remain profitable for future generations.

Almost half of landowners in Ohio are women. OSU Extension in Champaign and Miami Counties are offering a series designed to help female landowners understand critical conservation and farm management issues related to owning land. It will provide participants with the knowledge, skills and confidence to talk with tenants about farming and conservation practices used on their land. The farm management portion will provide an understanding of passing land on to the next generation and help establish fair rental rates by looking at current farm budgets.

The series runs every Friday, February 26 through March 26 from 9:00-11:30 a.m. and will be a blend of in-person and virtual sessions. It is $50 for the series. If you are only able to attend a couple of session, it is $10 per session but there is a lot of value in getting to know other participants in the series and talking with them each week. Registration can be found at go.osu.edu/legacy2021. For more information, please contact Amanda Douridas at Douridas.9@osu.edu or 937-772-6012. Registration deadline is February 24. The detailed agenda can be found at

https://miami.osu.edu/events/lady-landowners-leaving-legacy.

 

U.S. Farm Profits Projected to Fall in 2021

by: Chris Zoller, Extension Educator, ANR in Tuscarawas County

The United States Department of Agriculture Economic Research Service (USDA-ERS) on February 5th released their projection for U.S. farm income in 2021.  Farm income is projected to fall this year primarily because government payments received by farmers are expected to decline $21.8 billion (46.3%) after increasing $24 billion (104%) in 2020 (see Figure 1).

 

Figure 1.  U.S. Net Farm Income and Net Cash Farm Income, 2000 – 2021 Forecast

Net cash farm income (NCFI) is calculated by subtracting cash expenses from gross income.  This figure is expected to grow 23.7% in 2020 but drop $10.4 billion (7.5%) in 2021.  Net Farm Income (NFI) is considered a broader measure of profitability that includes changes in inventories, depreciation, and gross imputed rental income.  Like NCFI, the U.S. NFI is expected to increase in 2020 and decline 9.7% to $111.4 billion in 2021.  If this happens, it will be the first time since 2016 that NFI has fallen.  However, NCFI and NFI would remain above their respective averages during the 2000 – 2019 period.  A bright spot from the USDA-ERS report is that farm commodity cash receipts are expected to increase 3.6% in 2021.

Planning

Based on these projections, budgeting is going to be very important for 2021.  Ohio State University Extension has corn, soybean, and wheat budgets available here: https://farmoffice.osu.edu/farm-mgt-tools/farm-budgets.  I encourage you to use your financials and these budgets as a planning tool.  Scheduling an appointment with your lender, accountant, and Extension Educator to discuss options will be time well spent.