Economic and Marketing Information for Indiana Farmers (Jul. 31, 1967) |
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Economic and Marketing Information FOR INDIANA FARMERS Prepared by the Agricultural Staff of Purdue University, Lafayette, Indiana July 31, 1967 Should you Dry ml Store Corn and Soybeans? by B. F. Jones and P. R. Robbins, Agricultural Economics Does it pay to store soybeans or should they be sold at harvest ? What are typical costs for storing soybeans on the farm? Does it pay to dry shelled corn or take the moisture discount? What are drying and storage costs for corn? Whether to sell corn or soybeans at harvest or store on the farm depends on the cost of storage and the expected seasonal price pattern in your area. In addition, the following factors affect the decision: (1) Waiting time at elevator at harvest time. (2) Convenience of farm storage facilities including location and unloading equipment. (3) Availability of storage space. (4) Need for cash. (5) Alternative investment opportunities. (6) Risk of grain going out of condition. Soybeans Seasonal Price Changes Return from storage is determined by seasonal price rise. Indiana farm prices for soybeans vary within a given month and among various areas of the state (Table 1). For the last five years soybeans have averaged about 60 per bushel higher in the northern one-third of the state than in the southern one-third with central Indiana intermediate. Therefore Table 1 may understate the seasonal price change for a given farm. Table 1. Indiana farm price of soybeans, by month, 1956-67 Soybean prices usually rise from October to the following May. For 1956-61 average seasonal rise from October to the following May was 320 per bushel (Table 2). Annual rise varied from 70 to $1.06 per bushel. For the most recent five- year period annual price change varied from a loss of 190 to a gain of 620 per bushel, or an average gain of 220. However, for the person who picked the high month, gains from storage were much larger (440 vs. 220). Storage Costs Storage costs vary from farm to farm because of differences in bin use costs, losses and damage and extra handling required. The largest item is interest on money invested in soybeans (Table 3). This cost may be an actual cash cost or interest earnings foregone. Taxes and insurance combined are the second most important item. They vary widely because of differences in the tax rates and time of sale. For beans sold in May, farm storage has paid at least modest returns over the past 10 years with storage costs at 21.70 per bushel. Storage paid in only four of the most recent 10 years, but paid substantial returns for the 1960 and 1965 crops. Tax and Other Considerations Soybean storage costs can be reduced by selling before tax assessment. Up to March 1, total costs increase at the rate of Year Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Average cents per bushel 1956 223 229 243 269 307 297 252 233 208 207 228 230 244 1957 234 226 225 224 223 217 226 235 212 205 206 209 220 1958 208 207 212 218 215 217 216 216 198 194 190 198 207 1959 201 204 205 210 216 212 203 195 188 195 204 201 203 1960 203 200 199 204 202 201 202 203 197 194 196 203 200 1961 226 252 271 308 300 258 246 245 221 220 226 280 250 1962 231 231 233 240 238 235 235 232 223 224 229 234 232 1963 242 256 255 247 251 250 247 246 244 257 270 260 252 1964 267 257 255 245 238 236 235 239 250 257 259 278 251 1965 276 284 289 291 277 280 278 258 240 230 235 250 266 1966 269 279 271 280 292 307 343 350 296 278 278 283 294 1967 277 272 273 270 270 273
Object Description
Title | Economic and Marketing Information for Indiana Farmers (Jul. 31, 1967) |
Purdue Identification Number | UA14-13-econ196707 |
Date of Original | 1967 |
Publisher | Purdue University. Agricultural Extension Service |
Subjects (LCSH) |
Farm produce--Indiana--Marketing Agriculture--Economic aspects--Indiana |
Genre | Periodical |
Collection Title | Extension Economic & Marketing Information (Purdue University. Agricultural Extension) |
Rights | Copyright Purdue University. All rights reserved. |
Coverage | United States - Indiana |
Type | text |
Format | JP2 |
Language | eng |
Repository | Purdue University Libraries |
Date Digitized | 05/01/2015 |
Digitization Specifications | Original scanned at 400 ppi on a BookEye 3 scanner using Opus software. Display images generated in Contentdm as JP2000s; file format for archival copy is uncompressed TIF format. |
URI | UA14-13-econ196707.tif |
Description
Title | Economic and Marketing Information for Indiana Farmers (Jul. 31, 1967) |
Purdue Identification Number | UA14-13-econ196707 |
Transcript | Economic and Marketing Information FOR INDIANA FARMERS Prepared by the Agricultural Staff of Purdue University, Lafayette, Indiana July 31, 1967 Should you Dry ml Store Corn and Soybeans? by B. F. Jones and P. R. Robbins, Agricultural Economics Does it pay to store soybeans or should they be sold at harvest ? What are typical costs for storing soybeans on the farm? Does it pay to dry shelled corn or take the moisture discount? What are drying and storage costs for corn? Whether to sell corn or soybeans at harvest or store on the farm depends on the cost of storage and the expected seasonal price pattern in your area. In addition, the following factors affect the decision: (1) Waiting time at elevator at harvest time. (2) Convenience of farm storage facilities including location and unloading equipment. (3) Availability of storage space. (4) Need for cash. (5) Alternative investment opportunities. (6) Risk of grain going out of condition. Soybeans Seasonal Price Changes Return from storage is determined by seasonal price rise. Indiana farm prices for soybeans vary within a given month and among various areas of the state (Table 1). For the last five years soybeans have averaged about 60 per bushel higher in the northern one-third of the state than in the southern one-third with central Indiana intermediate. Therefore Table 1 may understate the seasonal price change for a given farm. Table 1. Indiana farm price of soybeans, by month, 1956-67 Soybean prices usually rise from October to the following May. For 1956-61 average seasonal rise from October to the following May was 320 per bushel (Table 2). Annual rise varied from 70 to $1.06 per bushel. For the most recent five- year period annual price change varied from a loss of 190 to a gain of 620 per bushel, or an average gain of 220. However, for the person who picked the high month, gains from storage were much larger (440 vs. 220). Storage Costs Storage costs vary from farm to farm because of differences in bin use costs, losses and damage and extra handling required. The largest item is interest on money invested in soybeans (Table 3). This cost may be an actual cash cost or interest earnings foregone. Taxes and insurance combined are the second most important item. They vary widely because of differences in the tax rates and time of sale. For beans sold in May, farm storage has paid at least modest returns over the past 10 years with storage costs at 21.70 per bushel. Storage paid in only four of the most recent 10 years, but paid substantial returns for the 1960 and 1965 crops. Tax and Other Considerations Soybean storage costs can be reduced by selling before tax assessment. Up to March 1, total costs increase at the rate of Year Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Average cents per bushel 1956 223 229 243 269 307 297 252 233 208 207 228 230 244 1957 234 226 225 224 223 217 226 235 212 205 206 209 220 1958 208 207 212 218 215 217 216 216 198 194 190 198 207 1959 201 204 205 210 216 212 203 195 188 195 204 201 203 1960 203 200 199 204 202 201 202 203 197 194 196 203 200 1961 226 252 271 308 300 258 246 245 221 220 226 280 250 1962 231 231 233 240 238 235 235 232 223 224 229 234 232 1963 242 256 255 247 251 250 247 246 244 257 270 260 252 1964 267 257 255 245 238 236 235 239 250 257 259 278 251 1965 276 284 289 291 277 280 278 258 240 230 235 250 266 1966 269 279 271 280 292 307 343 350 296 278 278 283 294 1967 277 272 273 270 270 273 |
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