Economist projects 2021 farm returns to remain high
An ag economist says he expects farm returns to remain high in 2021.
Gary Schnitkey with the University of Illinois tells Brownfield that’s based on an estimate of four-dollar corn and $10.50 soybeans.
“We’re projecting returns to be, roughly, in the $200 per acre range,” Schnitkey said.
Schnitkey said while his estimates are based on Illinois values, he expects those numbers to be consistent across the Midwest. But he said it will likely lead to an eventual market correction in 2022 or beyond.
“What these higher prices are going to do is bring on more land in Brazil and here and more switching from wheat to corn and soybeans,” he said. “And eventually those higher prices will bring on that supply and we’ll be looking at a period of lower prices.”
He said Coronavirus Food Assistance Payments made up $70 to $80 of farm returns per acre last year. Schnitkey’s estimate factors in $20 per acre of assistance in 2021, about 10 percent of his estimated return total.