In 2019, the total of all economic costs per acre for growing corn in Illinois averaged $878 in the northern section, $912 in the central section for farmland with “high” soil ratings, $887 in the central section for farmland with “low” soil ratings, and $851 in the southern section. Soybean costs per acre were $630, $672, $629 and $652, respectively (see Table 1). Costs were lower in southern Illinois primarily because of lower land costs. The total of all economic costs per bushel in the different sections of the state ranged from $4.38 to $4.95 for corn and from $10.50 to $12.54 for soybeans. Variations in this cost were related to weather, yields, and land quality.
These figures were obtained from farm business records kept by farmers enrolled in the Illinois Farm Business Farm Management Association. The samples included only farms with more than 500 acres of productive and nearly level soils in each area of the state; these are farms without livestock. Farms located in the 22 counties north and northwest of the Illinois River are included in the sample for northern Illinois. Farms from 36 counties below a line from about Mattoon to Alton are in the sample for southern Illinois. The remaining 44 counties make up the sample for central Illinois. The sample farms averaged 1,592 tillable acres in northern Illinois, 1,527 acres in the central section with high soil ratings, 1,535 acres in the central section with lower soil ratings, and 1,652 acres in southern Illinois.
Cost of Production for Corn Compared to 2018
Costs per bushel of corn in 2019 as compared to 2018 were higher in all regions of the state. Costs per bushel were higher due to lower yields. Costs per bushel were 51 cents higher in northern Illinois, 68 cents higher in central Illinois with the higher rated soils, 85 cents higher in central Illinois with the lower rated soils and 62 cents higher in southern Illinois.
The average corn yield in 2019 was 23 bushels per acre lower than 2018 in northern Illinois, 29 bushels to 32 bushel lower in central Illinois and 16 bushels lower than 2018 in southern Illinois. The 2019 average corn yield in the different geographical locations ranged from 19 bushels lower to 1 bushel per acre higher than the five-year average from 2015 to 2019.
Costs per acre for corn were mostly higher in all the different geographic regions in Illinois compared to 2018. Across the state, total costs per acre to produce corn varied from no change to a 5 percent increase. Fertility, drying, and nonland interest costs increased the most.
Cost of Production for Soybeans Compared to 2018
Production costs per bushel of soybeans in 2019 increased in Illinois in comparison to 2018. Costs per bushel increased due to lower yields. Soybean yields ranged from 4 to 10 bushels per acre lower in 2019 compared to 2018. Changes in costs per bushel ranged from $1.90 lower in southern Illinois to $1.29 lower in northern Illinois.
Total costs per acre increased in Illinois when compared to 2018. Costs decreased $10 per acre in northern Illinois, increased $8 per acre in central Illinois with the higher rated soils, increased $6 per acre in central Illinois with the higher rated soils and increased $24 per acre in southern Illinois when compared to 2018. Average soybean yields in the different areas ranged from 4 bushels lower to no change in bushel per acre when comparing to the five-year average from 2015 to 2019.
Total costs to produce corn for all combined areas of the state were $891 per acre. This is $30 per acre higher than 2018. Variable costs increased $25 per acre or 4 percent, other nonland costs increases $7 per acres, and land costs decreased $2 per acre. In 2019, cash costs accounted for 47 percent of the total cost of production for corn, other nonland costs were 29 percent, and land costs were 24 percent. The average corn yield for all combined areas of the state was 194 bushels per acre resulting in a total cost of production of $4.59 per bushel. The average corn yield in 2019 was the lowest in the last 4 years, 27 bushels to the acre less than 2018. Total costs per acre were the highest in the last four years while total costs per bushel were the highest in the last four years as well.
Total cost per acre to produce soybeans increased, from $644 per acre in 2018 to $651 per acre in 2019. Nonland interest accounted for most of the increase. Variable costs accounted for 33 percent of the total cost of production for soybeans, other nonland costs 34 percent and land costs 33 percent. The average soybean yield for all combined areas of the state was 59 bushels per acre resulting in a total cost of production of $11.03 per bushel. The cost per bushel to raise soybeans the last five years averaged $10.20 per bushel.
Forecasts for Illinois production costs in 2020 look to be more using Gary Schnitkey’s 2020 crop budgets and the USDA’s Cost-of-Production Forecasts as a guide. For corn, 2020 variable costs are projected to decrease 3 percent, mainly due to soil fertility costs. For 2020, soybeans have a smaller projected decrease of variable costs of 2 percent. This decrease is also primarily due to soil fertility costs. These decreases coupled with additional cutting of overhead and land costs will aid with lower projected prices for 2020.
The author would like to acknowledge that data used in this study comes from the local Farm Business Farm Management (FBFM) Associations across the State of Illinois. Without their cooperation, information as comprehensive and accurate as this would not be available for educational purposes. FBFM, which consists of 5,500 plus farmers and 60 plus professional field staff, is a not-for-profit organization available to all farm operators in Illinois. FBFM field staff provide on-farm counsel with computerized recordkeeping, farm financial management, business entity planning and income tax management. For more information, please contact the State FBFM Office located at the University of Illinois Department of Agricultural and Consumer Economics at 217-333-8346 or visit the FBFM website at www.fbfm.org.
A more complete discussion of how some of the costs are calculated can be found under Illinois Farm Management Handbook in the management section of farmdoc: https://farmdoc.illinois.edu/handbook/cost-to-produce-corn-and-soybeans-in-illinois
Schnitkey, G. “Crop Budgets, Illinois, 2020.” Department of Agricultural and Consumer Economics, University of Illinois at Urbana-Champaign, April 2020.
USDA. “Cost-of-Production Forecasts for U.S. Major Field Crops, 2019F-2020F.” https://www.ers.usda.gov/webdocs/DataFiles/47913/cop_forecast.xls?v=973