Seed money

MARGARETTA TWP. Margaretta Township farmer Brian Sutorius is riding the wave of corn, wheat and soyb
JACOB LAMMERS
May 24, 2010

 

MARGARETTA TWP.

Margaretta Township farmer Brian Sutorius is riding the wave of corn, wheat and soybean prices.  "You get while the getting's good," he said.

As the economy slows, agriculture is in the midst of a boom.

Wheat doubled in value from a year ago to about $10 per bushel. Corn and soybeans also doubled in price from two years ago to today's value of $5.11 and $13.16 per bushel, respectively.

In 2007, the country's net income for agricultural products reached about $90 billion -- a nearly $8 billion increase from 2006, said Rocky Black, a senior policy director of the Ohio Farm Bureau Federation.

"We're producing more acres of corn and soybeans because there's profit to be made," Black said. "If the trend continues, it could be very positive for agriculture."

Black said prices have steadily increased for the past decade.

Sutorius farms about 900 acres in Margaretta Township.

"When pricing is like this, it's a good year," he said. "It should be a fun year. It's going to be one that'll be talked about for a while."

Soaring grain prices are partially due to the ethanol boom, said Mike Gastier, Ohio State University Extension agent for Huron County.

Ethanol, a renewable fuel, is often made from grain.

Farmers are planting more acres of corn because the ethanol boom has made corn more profitable. With lots of farmland devoted to corn, soybeans and wheat are scarcer and more in demand, Gastier said.

These prices could last for another year, but farmers should be cautious, said Joe Cornely, spokesman for Ohio Farm Bureau.

"What comes up, comes down," Cornely said. "Always has, probably always will. The difference is how long."

Economists are forecasting for 2008 a 25 to 35 percent increase in corn prices and a 23 to 25 percent increase in soybeans, Cornely said.

The problem with rising prices is production costs keep pace. Farmers will have to pay more for fertilizer and farm machinery, Cornely said.

"We're not saying it's doom and gloom, but neither are we saying it's the golden age in agriculture," Cornely said. "Like most times, it's somewhere in the middle."

Cornely said the grain prices will eventually go down as demand decreases.

Sandusky County farmer Andy Warner said the high prices are exciting and allow him to spend a little more on equipment.

"We've bought some new things, but at the same time, we know it won't last forever, so we're saving some, too," Warner said. "When this does crash, it could be ugly."

Sutorius, 37, has farmed for more than 20 years and said it's always a gamble.

"It could get a lot better or the bottom could fall out," he said. "I don't know what's going to happen. It's just a volatile time."