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A farmer just won the lottery—what do they buy first? In February, the Farm Journal Pulse Poll asked that question specifically about technology purchases.
The top choice was variable-rate application technology with 31% of the responses (out of a total of 577 farmers)
The second choice was telematics with 28%.
Autosteering was third with 17%, which is interesting as a recent survey by the Association of Equipment Manufacturers calculates that more than 60% of row crop farmers are already using the technology.
While drones, smart phone apps, handheld technologies, and more get a lot of buzz, farmers may see less ROI in those as 16% say that’s their first-choice of where to invest the hypothetical windfall.
And it seems farmers are still getting their arms around the ROI of data management as well with only 8% saying software and data management is where they’d invest.
Weather is normally a factor in the commodity markets. But this year, weather could be an even bigger catalyst for higher or lower prices.
“I do think we’ll be more sensitive this year because we’re going into the growing season with such tight balance sheets in corn and soybeans in particular, relative to the last several years,” says Joe Vaclavik of Standard Grain.
The scenario the last five years was the same: rising yields meant growing supplies and rising stocks. Those factors proved to be anchors on the market.
“We had these big stocks that we had to chew through, we had a comfortable supply cushion, we had markets that offered carry. We’re in a totally different world right now here in 2021 versus where we were at this point last year, or even like every year to start basically since 2014,” Vaclavik adds. “We’re going to be a little bit more sensitive to weather, I think.”
Vaclavik says weather and acreage are two big pieces of the price puzzle.
“Acreage times yield, of course, is your production number,” says Vaclavik. “So, the weather and acreage are two very big forthcoming pieces of news.”
While a U.S. weather market is typically news that moves the market in the summer months, Matt Bennett of AgMarket.Net says there’s a chance the weather market arrives early this year.
“I know a lot of folks thought that we were going to maybe get an early spring for quite some time, and then most of the forecasts here lately have said actually it’s going to get a little wet in the month of March,” he says. “We don’t really know what’s going to happen in the spring timeframe.”
As Midwest farmers wait to see how spring weather is going to play out this growing season, Bennett says the general assumption in the market right now is there will be more acres planted in 2021. Several private estimates have supported USDA’s February outlook that showed a record number of corn and soybean acres planted in 2021. However, Bennett says the acreage story is just starting.
“But what if you do get into a wet spring tighten timeframe? The big thing for producers is that they want to get acres planted. We know that. But if you do have some sort of a wet weather pattern develop, there’s no question that the markets can be highly reactive. Because all of the assumptions that the market has already made could end up being basically thrown out the window if you end up having to have more prevent plant acres again this year,” says Bennett.
A January Farm Journal Pulse Poll resulted in 9% of farmers saying the market rally is leading them to try fungicides on soybeans for the first time.
With the stronger markets early in 2021, Farm Journal sent a text-based poll asking “What if any impact will strong soybean prices have on your plans for fungicides applications in 2021?”
While 64% at the time said they wouldn’t change their fungicide plan, only 8% said they wouldn’t apply fungicides on beans this year, and 28% are increasing their fungicide use