From Wayne Schoper
and Rich Baumann
South Central College
As mentioned in a previous column, there is a lot of concern regarding the late planting season this year especially for the corn crop. We do plant other crops, most notably soybeans, but corn does carry the bulk of cash-flow on most farms. According to the latest farm analysis figures just in from South Central College (New Ulm, Sleepy Eye Mankato area), corn again was the profit leader. This report also includes data from Riverland College (Owatonna and southeast Minnesota) and Minnesota West (Jackson and Worthington and southwest Minnesota. There are a total of 2500 farms from around the state included in the statistics. This is real data and the best information that we have to work with. As we have discussed, planting corn much past the first week of May can result in reduced yields and higher drying costs in the fall due to harvest of wetter corn. Everything depends on what happens the rest of the summer.
It looks like right now most of the corn got planted on time. We do have plenty of planting moisture but soil temperatures continue to be quite low. We have had a few warm days to bring the soil temperature in the root zone up to the low 50's which is where it has to be it has to be to germinate corn. What does this mean? If the corn lies in the soil too long without germinating, seed rot can occur and reduced or damaged stands can occur. Today's corn hybrids are bred with cold tolerance and can withstand very cold temperatures for a short period of time. However, if cold soil temperatures persist, the young corn seed tolerance for cold temperatures will be reached resulting in damage and death.
So when should we plant beans? Right after the corn. The concern with soybeans is that we occasionally have a late frost that can nip them and either kill or thin out the populations. The risk of waiting is that we may run into weather that puts us off into June and the risk of lowering soybean yields.
As for the rest of the Corn Belt, no one is really getting in early anywhere. Lots of rain hit Missouri and southern Iowa in late April that delayed planting there. The opposite is true in Kansas. There the winter rains did not come as expected and there are a lot of dry winter wheat acres. This year's hard red winter wheat tour estimated Kansa yields would be 37.4 bushels per acre, compared to 40.7 last year. Scouts have estimated total Kansas production at 256.7 million bushels down significantly from previous years. Late rains could still rescue some of the crop, but it looks like there is more downside potential than upside potential. Many of these fields could be worked up and planted to corn or some other crop.
Something else to think about. One source of real concern is China and their reserves of foreign currency (much of it U.S. dollars). By the end of March 2011, China controlled over $ 3 trillion dollars. The Economist Magazine puts it into perspective.
China could afford to buy all U.S. farms (valued at 1.87 trillion) and have a trillion dollars left over.
China could buy all of the world's monetary gold (value $1.43 trillion) and have change left over.
China could buy Apple, Microsoft, IBM and Google (cost $916 billion)
China could but all existing U.S. military equipment (value $414 billion)
China could buy all Manhattan real estate (value $287 billion)
But what will China really "buy" with all of these reserves? Speculation is that they have already started a migration out of U.S. dollars as a reserve and are aggressively looking to buy as much of the world's natural resources as they legally can. This means that they will be purchasing anything from gold to iron ore to corn. China's long-term strategy is to have the world's largest military force. Again, something to think about.