Yield Price Outlook for 2024

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In any situation, timing is everything, and in the agricultural world that seems to be an even greater factor, as prices and weather can change in a split second. Since reaching record highs in 2022, the U.S. Department of Agriculture foresees the farm sector income to continue to fall in 2024. Net farm income reached $185.5 billion in 2022 and looks to drop to $121.7 billion this year. Locally, Midwest Bank CEO Chris Gavin says nothing dramatic has occurred yet, but the changes in the working capital are concerning as farmers look at average yield prices:

“Through a database that we have, through our Grainbridge platform we are tracking 27,000 corn acres and average yield we are projecting is 217 bushel. The average break even for those farmers is $4.48 and we’re sitting today at $4.33, which equates to about a $33 loss per acre right now on the farmers that we have on this platform. On the soybean side, we have 21,000 acres and using a 64 bushel yield, the break even price is $11.62 and we’re sitting at $11.55; just about a break even overall in the soybeans, but that’s not sustainable and that’s what we’re worried about. We’re fortunate we have a lot of really good farmers as far on the way they manage their operations and we also have good land and we’ve had good weather, so we have been blessed with that and that has got us through, but you can’t count on that happening every year.”

With the 2024 farm sector income forecast from the USDA, crop cash receipts for the year are projected to total $245.7 billion, a decrease of $16.7 billion from last year. Meanwhile, combined receipts for corn and soybeans are forecast to fall $17.2 billion.

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