You’ve got three or four main U.S. commodities competing for the same acres, and we need more acres, but there’s not more acres out there.
And that race for acres made commodity markets volatile.
The price made it a lot more attractive to plant more acres, and I doubled my wheat acres this year.
Everything got off to a good start. And then it got dry, and drier, and drier.
Even if a producer had access to ground water, watering was expensive.
The real problem this year with the watering is the cost of the fuel. I think we’re going to be around a hundred dollars per acre in fuel costs alone.
Economist Joe Outlaw pointed out that any significant increases in food prices were the result of higher fuel prices, not higher grain prices.
So the value of the corn in the corn flakes has gone from two cents to four cents. We all know that we pay a lot more than four cents for a box of Post Toasties.
Beef, pork, and poultry producers saw feed prices skyrocket.
There’ll be two responses. Feeder cattle prices, the costs paid to a cow/calf producer will go down significantly, or our people will go out of business.
Bill Turner said we’d likely see cow/calf operations adapt to changes within the beef industry.
We won’t be selling light weight calves. We’re going to keep them on the ranches, get them heavier, and when we do sell them, we gross more dollars, and we’ve got to do that cheaply.
And the ethanol debate continued.
The corn usage in ethanol is going to be four billion bushels in 2008 and that is an amazing one-third of the corn crop.
After cotton farmers dodged Hurricane Gustov, they worked frantically to get their crops in. Ike took a toll from cotton waiting to be harvested.
It was just so vulnerable to that wind and rain, that driving rain, it was blown out of the burr and knocked on the ground for the most part.
As is the case every year, there were winners and losers in the scenarios agricultural producers found themselves facing, and as we speak, they’re getting ready for 2009. I’m Joe Brown, looking at Brazos Valley Agriculture, From The Ground Up.