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Corn, soybean and wheat prices have all done well this year, although yields (especially corn) have suffered. Many grain farmers are considering planting wheat this fall and following with a soybean double crop.
However, double crop soybeans are more susceptible to summer drought and typically yield about 20 percent less than full season soybeans. Let’s consider an example of a planting decision and possible implications using a UK agriculture economics web based decision aid.
Additional costs associated with the double cropping including fuel, machinery repairs and depreciation, labor and hauling are included. Assumed selling prices are $13.25 per bushel for soybeans and $8.25 per bushel for wheat.
Cash rent is assumed to be $175 per acre but can vary substantially by farm location, field size, yield capability and term of lease. Net profit is estimated after subtracting out all variable and fixed costs. Major assumptions are: $3.75 per gallon fuel, 100-mile one-way trucking, $.65 per unit N, $.42 per unit P, and $.50 per unit K and about 20 percent yield drop for double crop beans.
If we assume 65-bushel wheat, 35-bushel double cropped soybeans and 45-bushel full season soybeans yields, the net profit above all costs for wheat and soybean double crop is $287 and for full season soybeans is $202. This results in about $85 per acre difference in favor of double cropping.
So, if the above-mentioned assumptions actually occur, double cropping would be worth considering for the 2012-13 crop year. However, there can be a multitude of problems such as a drop in prices, a drop in yields due to weather or disease, or increased expenses.
Each farmer should change the assumptions above to his particular farm’s yields, rental price and other specific conditions and evaluate his expected profitability. You can do this by going to the UK Department of Agricultural Economics Budgets/Decision Aids website at http://www.ca.uky.edu/agecon/index.php?p=29.