© 2021 WYPR
Header Background.png
Play Live Radio
Next Up:
0:00
0:00
Available On Air Stations

Plunge In Grain Prices - 3/17/15

While much of the economy is now steadily improving, circumstances for many grain farmers have become deeply problematic.  Across the Midwest and elsewhere, a plunge in grain prices to near four-year lows is making it difficult for tenant farmers to make their rent payments.  As reported by the New York Times, many rent payments, which vary from a few thousand dollars for a tiny farm to millions for a major operation, were due on March first. 

It is likely that many of those payments were not made.  The US Department of Agriculture recently estimated net farm income, which peaked at one hundred and twenty-nine billion dollars in two thousand and thirteen, could fall to seventy-four billion dollars this year, a decline of forty-three percent over two years. 

While the costs of inputs like fertilizer and seed have remained stubbornly high, a stronger U.S. dollar has diminished export growth and grain prices are expected to remain low.  Some farmers are walking away from their leases.  In Iowa, the nation’s top producer of corn and soybeans, analysts believe that of the estimated one hundred thousand farmland leases in the state, one thousand or more could be breached by this spring.

Anirban Basu, Chariman Chief Executive Officer of Sage Policy Group (SPG), is one of the Mid-Atlantic region's leading economic consultants. Prior to founding SPG he was Chairman and CEO of Optimal Solutions Group, a company he co-founded and which continues to operate. Anirban has also served as Director of Applied Economics and Senior Economist for RESI, where he used his extensive knowledge of the Mid-Atlantic region to support numerous clients in their strategic decision-making processes. Clients have included the Maryland Department of Transportation, St. Paul Companies, Baltimore Symphony Orchestra Players Committee and the Martin O'Malley mayoral campaign.