Four Ways You Can Trim Costs In 2016

From United Soybean Board         www.unitedsoybean.org

Soybeans are projected to be $8.90 per bushel in 2016, much lower than the last few years. According to forecasts from University of Illinois Farm Management Specialist Gary Schnitkey, Ph.D., farmers should strive to cut $100 per acre in costs to stay profitable. To help get you started, he recommends taking a closer look at these four inputs when budgeting for 2016:

1. Machinery and capital purchases

“This isn’t the time to be spending money on new machinery purchases,” says Schnitkey. “Purchases were high in 2010 through 2013, but they now need to be reduced due to lower cash flows.”

University of Kentucky Extension Soil Fertility Specialist Josh McGrath, Ph.D., recommends investing more time in making sure the machinery you already have is working efficiently.

“It’s really important that you’re investing your time in your equipment,” says McGrath. “Most of your yield potential is set the day you plant. A lot of times, I don’t see folks out checking the planter enough during planting to make sure that it’s set up correctly. Invest your time to make sure that you’re starting off with a really good stand.”

2. Fertilizer

Maintaining soil fertility is a long-term investment. Be sure you are sampling your soil regularly, following your soil-test recommendations and avoiding over-applying nutrients.

“If you are going to take the time to plant the crop, make sure you optimize it economically,” says McGrath. “Land-grant university soil-test recommendations are backed by a lot of data and are based on maximizing economic return. Don’t over-apply in an attempt to boost yield.”

3. Chemicals

As always, it’s important that you know economic thresholds for your area (the pest population at which a pesticide application is worth the expense) before applying pesticides, but it is particularly important when looking to cut costs.

Following economic threshold guidelines will give you a better idea of when or if you should apply a pesticide. In this case maximizing your ultimate economic return could mean allowing a small amount of yield loss if it’s not economically beneficial to intervene.

Pest pressures vary regionally, so be sure to follow your local economic threshold recommendations.

4. Seed

“I would be thinking about lowering seeding rates if you’ve been experimenting with higher rates,” says Schnitkey.

Making sure that you are setting your seed properly to ensure a good stand is more important than the total population. If you normally drill soybeans, you may consider using a planter to reduce seeding rate and get more precise seed placement.