Thanksgiving is almost here and Christmas is just around the corner. Families and friends everywhere are gathering to share great food and celebrate the good things in each of our lives.
It’s also a good time to re?ect back on the year and count our many blessings. That may seem hard in a year plagued by a cold, wet spring and summer drought, but there are still plenty of reasons for Wisconsin farmers to be grateful in 2013.
Farmers across much of the state battled cold temperatures and excessive rain throughout most of April, May and June. As a result, many farmers finished up planting corn and soybeans and harvesting first-crop hay in mid-to-late June.
The weather changed dramatically by mid-July when abnormally dry weather with hotter temperatures began to settle in causing much of the state to receive little or no rain during August. The delayed planting schedule led to an unusually long corn silage harvest that began in early September and continued through mid-October. The good news was a late killing frost in October allowed late planted corn and soybean crops to mature. But the soybean and corn harvest was delayed due to the late planted crops and rains that slowed the harvest in late October and early November. As of the first week of November, only 45% of the corn crop and 75% of the soybean crop was harvested statewide compared to last year when nearly all of the soybean crop and 90% of the corn crop was harvested.
Despite a number of challenges, Wisconsin farmers still have many blessings to count this year:
¦ Corn yields in Wisconsin are predicted to average 145 bushels per acre in 2013. That’s up from 127 bushels in 2012. Locally, corn prices peaked in January at $5.65 per bushel. By November, prices dropped to about $4 per bushel. Last year, corn peaked at $8 a bushel in August and dropped to $6 by November.
¦ Soybeans are projected to average 40 bushels in 2013 compared to 39 bushels in 2012. Soybeans peaked locally at $13.27 a bushel in mid-September, and then slipped back to $12 by November. But that’s much less than growers received in 2012. Last year, soybeans peaked at $17 a bushel in early September and dropped to $14.75 by November.
¦ Wheat yields were a different story. Wisconsin wheat yielded an average of only 58 bushels per acre in 2013, compared to 75 bushels in 2012. 2013 was the lowest state wheat yield since 2005. However there were 20,000 more acres harvested in 2013 than in 2012. Wheat prices in 2013 peaked at more than $7.75 per bushel locally in February and slipped back to $6 per bushel in November. That’s less than growers were paid a year ago. In 2012, wheat prices peaked at $9 in mid-July and dropped to $7.90 in November.
Strong milk prices
¦ Dairy farmers are on pace to average $18 a cwt. for Class III milk in 2013 which isn’t bad with lower feed prices. There’s no doubt that’s way better than the pitifully low $11.36 average in 2009. Class III milk prices last year averaged $17.44 when feed prices were sky high. The 2014 milk price is expected to average $17.55, according to USDA estimates. Lower feed prices will likely help dairy producers’ bottom lines the second half of 2013 and all of 2014.
Record beef prices
¦ Fourth quarter 2013 cash and fed cattle futures marched to record highs of $132 per cwt. Fed cattle futures suggest cattle prices should set record highs again in 2014’s first half with feeder cattle topping $162 per cwt. in November.
The key beef complex driver is tight supplies linked to prolonged drought in the Great Plains and earlier lack of profitability. So far, consumers have been willing to pay up for already pricy beef. That’s lifted wholesale prices allowing packers to pay more for cattle.
However, beef will likely face consumer resistance at some price, which could limit further gains in cattle prices. Consumers have responded to a series of record retail prices for beef over the past few years by turning to chicken or pork, which are cheaper per pound.
How long the market will be grappling with tight cattle supplies is unclear. Drought conditions have eased in much of the Great Plains. Corn Prices for 2013 crop corn are much lower than a year ago.
Cow herd expansion may already be underway. That will further tighten immediate beef supplies, but bring larger supplies later. Beef cows and feeder cattle should remain valuable property for at least two years.
Positive hog outlook
¦ Falling feed prices make the 2014 hog outlook almost the opposite of what it was last year. Lower feed costs and higher hog prices point to profits somewhere in the $20 per head area. That’s roughly the same size as expected losses based on year-ago prices. Recovery should help stabilize producer finances.
Expected profits will likely lure producers to expand breeding herds. Lower feed costs will likely result in heavier market hogs coming to slaughter, boosting pork supply a bit.
Expansion could put more pork on the market by 2014’s second half, pressuring prices and profits. The hog industry had difficulty sorting through impacts of baby pig losses due to the spring outbreak of porcine epidemic diarrhea virus. Such uncertainties could crop up again in 2014.
2013 farm bill
What farmers and consumers really need is for Congress to pass a farm bill by the end of the year. House and Senate conferees have been working on the farm bill since October, so the possibility is there that one will be passed and signed into law by the president, but don’t hold your breath. This Congress has agreed on very little so far this year. Passing a farm bill in 2013 would be a good first step in showing the American people that they can at least accomplish that much.
Here’s to a happy and healthy holiday season with your loved ones.