From the University of Illinois' FarmDocDaily:
2013 Net Farm Income Projections
Current futures prices suggest harvest-time 2013 prices of $5.80 per bushel for corn and $12.40 per bushel for soybeans. Given these prices, 2013 farm incomes likely would be above average. Worst case incomes depend on levels of projected prices used to set crop insurance guarantees. Likely projected prices will provide significant downside revenue protection. To quantify income projections, farm incomes for a 1,200 Illinois grain farm are simulated and presented.Although above average the decline from 2012 is not good news for implement manufacturers.
Net farm income is simulated for the following farm designed to be representative of commercial grain farms in Illinois:
Projected 2013 Net Farm Income
- The farm has 1,200 acres.
- Expected yields are 187 bushels per acre for corn and 54 bushels per acre for soybeans, with two-thirds of acres in corn and one-third in soybeans.
- The farm owns 120 acres, share-rents 360 acres, and cash rents 720 acres. This represents the typical tenure/rental situation for farms in northern and central Illinois.
- Cash rent is $300 per acre.
- Farm costs are specified at levels contained in 2013 crop budgets.
- The farm has $480,000 of debt.
Current forward contract bids for 2013 harvest time delivery are $5.80 per bushel for corn and $12.40 for soybeans. Given these commodity prices, net farm income is projected at $291,000 (see Table 1). This income would be high relative to averages. Farms of this size have average income around $207,000 for the years from 2007 through 2011.
Slightly lower price projections of $5.40 for corn and $11.80 per bushel for soybeans would result in $229,000. Income projections at this level would still be above average....MORE
Regarding averages, as the statistics prof was way too fond of saying: "The average person has one boob and one nut".