Economic and Marketing Information                                                                                                                                                                                          FOR INDIANA  FARMERS
Prepared by the Agricultural Staff of Purdue University, Lafayette, Indiana      
October 31,   1961
1962 Outlook for Indiana Agriculture
in a nutshell 
Net Income
Net income for Indiana farmers in the year beginning
October 1 will be down slightly from the past year. Net
income for U.S. farmers will average about the same as
last year. Indiana farm incomes will be down primarily
because of lower hog and poultry prices. Lower hog
prices will have a greater impact on Indiana farmers
than U.S. farmers, since hog sales make up a much
higher percentage of the total Indiana farm income.
General Business Activity
Substantial expansion in general business activity is
expected in the year ahead. The rate of business expansion should be about the same as during the periods following our last two recessions. The upturn in the general economy will affect Indiana farm people. Some of
the ways in which they may be affected are:
1. Off farm employment will be easier to find. However, good jobs will not be plentiful for unskilled or
older workers.
2. Hired farm help will probably be a little less plentiful and wage rates may be slightly higher.
3. Prices of farm production items will probably increase slightly.
4. The movement from farms tends to be greatest
when general business activity is expanding. This will
probably mean greater difficulty in finding and keeping
good tenants especially for below average farms.
5. An increasing number of Indiana farm operators
will become part-time farmers and more farm wives will
find off-farm employment.
6. The business upturn will mean only a slightly
stronger demand for farm products. However, the business upturn plus population increase should raise total
demand for farm products about two percent in the year
ahead.
For highest profits in the year ahead one should strive
for efficient operation of the farming system that is well
adapted to existing conditions. This will require high
production rates, adequate volume of business and strict
attention to buying and selling operations.
Corn
Modest profit may be expected from corn storage. Corn
at harvest should average $.90 to $1.00 per bushel on a
No. 2 basis. By next summer corn in Indiana should rise
to the $1.10 to $1.20 level in surplus areas and 10 to 20
cents higher in corn deficit areas.
About half of the corn crop is eligible for government
support loans. Many Hoosier farmers with surplus corn
will find it profitable to take advantage of the support
program.
If additional corn will be needed for livestock operations, one might well consider purchasing corn at harvest
time, especially in corn deficit areas.
Soybeans
Only modest profits are expected from soybean storage
this fall. The 1961 soybean crop is very large as compared to past crops—29 percent larger than the 1900
crop and 22 percent larger than the previous record crop
of 1958. However, any farmer is assured of a support
price of $2.30 per bushel (national average) should he
elect to avail himself of the support program.
The total cost of storing soybeans from harvest to
next spring should be about 15 to 17 cents per bushel.
About 3 to 4 cents of this total cost is a fixed cost in
bins. About 7 to 8 cents is for interest on the investment
in stored grain. If one has empty bin space on the farm
and a CCC loan is taken on the soybeans, then storage
costs may be computed somewhat below the 15 to 17
cent level.
Livestock  Feeding
Protein feeds, especially soybean meal, will be relatively
cheap and plentiful in the year ahead. Compared with recent years, soybean meal will be relatively cheap in relation to corn. Livestock rations, therefore, should be
fortified with liberal amounts of protein supplement.
Hogs
Hog prices are expected to average $1.00 to $3.00 lower
in the year ahead than in the year just past. However, the
hog-corn ratio is not likely to fall below the long-time
Indiana farm price average of 13.7 to 1 before mid-
1962. It appears that increased marketings by late 1962
and early 1963 will bring about unfavorable feeding
ratios for hogs.
Low per unit cost will be more important than extremely large volume in the hog business during the
next 12 to 24 months. With lower hog prices and higher
corn prices, it will be especially important to watch feed
efficiency.
Average or better hog producers should generally feel
justified in raising at least their usual number of pigs
that will be marketed by mid-1962. Hogs to be marketed
after mid-1962 might well be reduced some—especially
if this would improve efficiencies.