Farmers use profit to pay down debt, increase working capital
South Dakota’s corn crop grew in worth by $1 billion in 2011, reaching $3.953 billion (an average of $6.05 per bushel) and outstripping both 2010’s $2.899 billion ($5.09 per bushel) and 2009’s $2.282 billion ($3.23 per bushel), according to the National Agricultural Statistics Service.
Overall, the state is on par with a national trend: the value of the nation’s corn crop rose from $46.734 billion in 2009 to $76.464 billion in 2011, and the average per-bushel price increased from $3.55 to $6.20. South Dakota farmers say they are using their profits to pay down debt and increase their working capital. In addition, current projected numbers point to corn being more profitable than soybeans in 2012, leading some farmers to plant successive corn crops, rather than rotating to soybeans — if the weather allows for it.
An early, dry spring would let farmers plant sooner, but if planting is delayed, corn’s yield potential declines more rapidly than that of soybeans, according to Keith Alverson, secretary-treasurer of the South Dakota Corn Growers Association and board member of the National Corn Growers Association. If, however, spring allows a typical planting schedule, “guys will lean toward corn,” said Alverson.