When it came to corn profits – or losses – in 2014, it was all about yields.
But production both past and present figured into that equation, according to our county-by-county analysis. Though yields were important, support from the new government program and crop insurance also figured into results in some areas. Both those programs factor in historical yields, a process that helped some areas and hurt others.
We've put results online with an interactive map that shows the income statement for counties in the 12 north central states. Here's what the map details:
Yield per planted acre as reported by the Farm Service Agency.
Cash prices, represented by regional benchmarks or representative posted county prices for the 2014 crop year.
ARC Payment: We adjusted the official payment reported by FSA to reflect various factors, including estimates of program participation, base acres vs planted acres, and budget sequestration cuts.
Insurance: Average insurance payments per acre reported by the Risk Management Agency for all types of politics on corn.
Revenues: Total cash sales, ARC payments and insurance.
Costs: This includes county average cropland rent reported by USDA and non-land cost budgets prepared by various state Extension offices.
Profits: The difference between revenues and costs.
Several areas stood out as centers of success for the 2014 crop. Overall average corn yields in the U.S. set a record, and many areas enjoyed yields that were well above average. Many counties in Missouri, for example, enjoyed yields that were 50% or more above average.
In other areas, yields weren't as good as expected. But help from the government safety net were enough to push them into a profit. This was true in parts of Iowa and Minnesota. These counties received 100% of their maximum payment from the new Agriculture Risk Coverage program. Because these are consistently good areas for corn production, their yields for the program matched long-term averages, helping the program work more effectively
In some counties, ARC benchmark yields were actually above their long-term averages, which increased their program benefits. This was true in some areas of Iowa and southern Wisconsin, for example.
Historical yields also were a factor in the other part of the government's safety. Growers with better corn yields historically benefited from cheaper crop insurance. That made them more likely to buy up coverage, especially the 85% level of Revenue Protection. That made them more likely to receive an insurance payout if their yields were more average.
Costs also figured into profitability, especially rent. High cash rents in Illinois made it impossible there for the average grower to make a profit. Areas with cheaper rents on the fringes of the Corn Belt often did better in our study. However, that points up one difficulty in assessing profitability. Counties on the Plains are more likely to have irrigation. We attempted to average yields, revenues and costs for irrigated and dryland acres in these counties based on historical patterns. But lack of data makes these estimates less clear-cut than in the heart of the Corn Belt.