Are You Chasing That Proverbial Last Penny?

Richard Taylor, Extension Agronomy Specialist;

While visiting in Louisiana last week following some devastating flooding in central and western Louisiana, I found myself wondering, “How widespread is the notion that a successful grower needs to do everything possible to earn the last penny possible from his or her crop?” Driving through areas of Louisiana from which the flood waters had barely receded, I was saddened to see growers already replanting their corn crops on ground that was still wet enough to be at risk for compaction from the heavy machinery. I heard that many growers were having to buy whatever corn seed was left in the distributor’s warehouse since they already had used up all available seed of the most desirable hybrids. Combining lower yield potential hybrids with heavy no-till planters on wet soil and with subsequent compaction issues just to have a crop in the field raised questions about profitability in my mind. As it turned out, my fears were more than justified since three days after I observed the frantic planting efforts another stalled low pressure system and front flooded the newly planted fields once again.

As we all get anxious about the planting window here on Delmarva and winter sends another cold blast our way that will keep soil temperatures low, I thought I would ask that each grower take a moment to review their 2016 management and spending plans to ensure that they aren’t chasing that last penny of profit. I remember Dr. Allan Bandel from the University of Maryland talking about the need to have each dollar spent on inputs return, or at least have the potential to return, four dollars in revenue to justify spending a dollar. Of course, Dr. Bandel was thinking of non-irrigated corn. This was back when dryland corn yields averaged 90 to 120 bushels per acre. With irrigated corn acreage substantially higher in 2016 and corn yield potential both for irrigated and non-irrigated corn much higher than it was in the 1980s, the four dollar return for the last dollar spent on an input is now outdated. Still, I would suggest that even those producers that grow only irrigated corn, the level of production risk (corn knocked down by a late-summer hurricane, green snap from straight-line winds during the rapid growth stage, hail injury from summer thunderstorms, and a range of other potential yield limiting events) is still great enough that the last dollar spent on inputs should at least potentially return two dollars in income to justify the money spent.

With corn yield potential ever climbing, there are more and more miracle products available to growers that will add that little extra yield which will improve their profitability. In almost all cases, these miracle products have scant research to back their claims and what research that might exist often is the result of the company hiring someone to do the ‘research’. As you wait for the soil temperature to warm enough to justify planting corn, please take time to look over your planned input costs to be sure they all are justified and that they merit the money you plan to spend knowing that there is a level of risk that must be taken into account.