The latest Farmer’s Confidence Index is the lowest it’s ever been thanks to hardships due to the global economic slowdown.
After years of growth and plenty, farmers across the state are suffering at the hands of a down-turned market. Grain prices—the price per bushel of corn and soybeans—have collapsed, and the costs to plant and harvest have stayed the same.
Professor of agricultural economics at Purdue University Craig Dobbins says that leaves a lot of Midwestern farmers in an untenable position.
“The margins that farmers are now working with in the grain sector, certainly, in many cases, are probably negative,” he says. “If one were to add up the total cost of production per bushel for corn and soybeans, the price is below the total cost of production.”
The drop in corn prices is due to decreased demand for ethanol production. And soybean prices have fallen due to the Chinese economic downturn. China is a major importer of US agricultural products.
Dobbins says for Indiana farmers, cutting costs for the next few years will be the key to staying afloat.
“The name of the game in production agriculture is what you can do to get costs under control or costs down below what the prices are in the marketplace,” says Dobbins.
Lower grain prices means consumers may see a slight decrease in the price of meat
