BLOOMINGTON - If nothing else, farmers can expect crop prices to continue to fluctuate. The prediction for the price of corn in the next year is $6 a bushel, plus or minus $2, while the price for soybeans could be $13 a bushel, plus or minus $5, said Darrel Good, University of Illinois Extension agriculture marketing specialist.
"The truth is we may see both (increases and decreases) before all's said and done," Good told about 120 people Thursday at Soy Capital Ag Services' annual plot day at a farm in east Bloomington. "That's kind of the market we're in right now."
Already, 2008 has been a year of volatile and high prices. Corn, for example, has ranged in price from about $3.50 to more than $7 a bushel.
Good thinks corn will settle at about $5 a bushel in the next year while beans will draw in about $11.
A variety of factors tug at price levels, such as demand and the size and condition of the crop, Good said.
The industry has concerns about the demand for exported corn because of a bigger wheat crop that competes with corn as a livestock feed product. It's also worried about the possibility of economic weakness spreading to Europe, he said.
"The sky's not falling, but a few cracks are developing on the demand side," Good said, noting that ethanol producers also need to earn more to maintain and grow their demand for corn.
The industry so far has received mixed signals on the condition of the crop and production size, Good said.
Government statistics show corn conditions are above average but have deteriorated since the end of July and early August. Despite earlier positive national yield predictions, dry August weather could reduce yields for both corn and soybeans.
People also are uncertain about how many acres were ruined by early season flooding, Good said.
Since farmers will not build inventory this year, they need to plant more acres of corn and soybeans instead of wheat or cotton next year, Good said. Some conservation land also may come back to production.
Farmers in Central Illinois, already a heavy corn and bean area, are doing almost all they can do to grow a lot of those crops, Good said.
"We may be asking some of you to plow up your back yard," Good joked.
Posted in Business on Friday, August 29, 2008 12:00 am Updated: 11:32 am.
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