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The information presented on this page was originally released on April 12, 1996. It may not be outdated, but please search our site for more current information. If you plan to quote or reference this information in a publication, please check with the Extension specialist or author before proceeding.
Ag Markets Leap Into New Season
MISSISSIPPI STATE -- Mississippi farmers are plowing ahead optimistically into a new growing season as several commodities post life-of-contract highs on the market.
Many farmers still are reeling from the battles of 1995 which included tremendous insect control costs and a late summer drought.
Dr. Rodney Foil, vice president for agriculture, forestry and veterinary medicine at Mississippi State University, said based on current market trends, the total farm income may result in about a $300 million increase over 1995 figures. The total farm income for Mississippi was $4.4 billion in 1995. A total farm income figure at or above $4.5 billion would be a new record for state producers.
"In recent days we have seen 7-year highs, 16-year highs and all-time highs in corn, soybeans and wheat," Foil said. "While this is great news for growers, producers of livestock, poultry and catfish are seeing much higher feed prices."
Foil said the increase in feed costs will make management even more important this year, especially for cattle producers.
1996 calf prices are down about 30 percent.
Although June hog prices also have reached life-of-contract highs and catfish, poultry and egg prices have been fairly good, feed costs are up at least 35 to 40 percent, according to university agricultural economists.
"It is unusual to have this many life-of-contract highs at this time of year," said DeWitt Caillavet, extension agricultural economist at MSU. "Stocks are drastically low on the heels of a low production year compared to a year of extremely high demand."
Dr. Tom Jones, extension agricultural economist at MSU, said the U.S. corn growers produced 7.4 billion bushels last year, but Americans consumed or exported 8.5 billion bushels.
"By the end of this summer, corn supplies will be critically low," Jones said. "It's a beautiful time for corn producers, but not for producers buying feed."
While several futures prices could go higher, on April 11, corn futures posted an all-time high price of $4.55 per bushel,
December corn reached $3.54 per bushel, November beans went to $8.06 per bushel, and July wheat reached the $5.41 per bushel level.
June hogs were trading at $58.80 per hundredweight.
Experts predict Mississippi's corn acreage to increase 83 percent for a total of 550,000 acres.
Foil said for Mississippi's farm income to improve from 1995, growers must consider several critical factors.
"Given the new Farm Bill that President Clinton signed the first week of April, we must make good planting decisions this spring," Foil said. "Rebounds in cotton and soybean yields are very important, as is another $1.1 billion forestry year."
Effectively marketing state crops while prices are favorable also is important.
Controlling costs will be key in 1996, particularly for enterprises that will be negatively impacted by rising feed prices.
"MSU agricultural personnel are prepared to assist Mississippi farmers, ranchers and agricultural business firms with their important decisions as we all strive to raise state agriculture to new heights," Foil said.