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Thu August 30, 2012
Despite Drought, Some Corn Farmers Reap Bounty
Originally published on Thu August 30, 2012 6:18 pm
For every farmer who is hurting this year during the drought, others are benefiting. Many fields in the South, Northwest and Upper Midwest are producing bountiful corn crops. And because the drought has pushed prices to record highs, farmers who have corn to sell expect a terrific payday.
"The corn has actually really, really taken off all the way through season. It's grown fast. It's been accelerated. The corn looks really good now," says John Scott, whose family farm in Sargeant, Minn., is just bursting with corn.
Scott peels back a corn husk to reveal a bright, yellow ear. He grows about 2,500 acres of corn on several farms about 100 miles south of Minneapolis. The stalks are deep green, and they sway 10 feet in the air, just the way they should act this time of year.
"I would say this field would probably be a 185- to 200-bushel yield. That's exceptional for this year," he says.
Scott didn't completely dodge the drought. Some of his other fields are dry and might not yield as much corn. But with corn prices topping more than $8 a bushel, and about half of his crop still up for sale, being average could still mean well over $1 million in revenue this year.
A few steps from the field, he shows off the newest addition to the farm — a Hagie Sprayer. It's a massive machine with tires that are 6 feet tall and a sprayer that folds out 120 feet wide.
"It's probably the most expensive machine I've ever bought. What this rig allows us is, it's so tall, that we can actually go through tall corn and actually spray the fungicide onto the corn," Scott says.
Scott bought the sprayer, paying $320,000 for it. He also bought a top-of-the-line Lexion Caterpillar combine for another $300,000. When times are good, he puts the money he earns right back into his farm. "If we would have had droughted corn, I would have used my same machine. I wouldn't have purchased anything, that's for sure."
Jake Putnam with the Idaho Farm Bureau says despite the terrible drought in the Midwest, many of his farmers are buying big-ticket items like combines and irrigation pipes.
"For the farm operations that do well this year, they take the money, and they immediately will reinvest that money back into capital," Putnam says. "And it's such a tight cycle that you won't see even the most profitable farmers do anything like take a vacation or stuff like that. It goes right back to the operation, for the most part."
Putnam says Idaho corn farmers expect to reap record profits this year as some farmers there benefit mightily from other farmers' misfortune. That's because most Idaho farmers irrigate their fields with water stored in reservoirs since winter.
Down south in states like North Carolina, some farmers are also smiling more this harvest season. The drought has pushed the price of corn up nearly 40 percent in the past two months, from about $5.50 to more than $8 a bushel.
Ron Heiniger is a corn specialist at North Carolina State University. He says about 70 percent of North Carolina farmers have already begun to harvest their field crop. After two dry years in the state, farmers expect one of their best harvests ever.
"In fact, I had a grower tell me, he says, 'I'm thinking about making my truck driver take an insurance because every semi-load of corn that leaves my farm is like a semi-load of gold. I need a Brink's truck just to follow it to the market 'cause I got so much money in there,' " he says with a laugh.
Heiniger says corn producers are looking to gather and store their corn as quickly as possible. There may be money standing in the fields right now, but high corn prices won't reap benefits for anyone if a hurricane or other unexpected weather event hurts the crop before it makes it to the bin.