High Yields, Damaged Soybeans, Falling Prices-OH MY!
2024 crop year is the season that keeps on giving. (note sarcasm in that comment!) Farmers around the country are reeling from large monetary discounts on damaged soybeans. These are soybeans that are grown to be crushed for their oil and meal. I am very thankful that our food quality soybeans are a later maturity and do not appear to have damage in the crop. The early planted commercial soybeans were damaged during the many days of rain and fog associated with Hurricane Francine and then hurt even more from Helene’s rains thereafter.
Spring planting provided a terrific opportunity to plant soybeans early in this growing region. Attitudes were great and farmers were extremely excited and happy to start the crop with timely planted crops, including soybeans. Farmers rely on university soybean yield trials and research about planting date information to guide them to the best varieties and planting dates. Data for many years has pointed to the fact that earlier planted soybeans yield higher which in turn will result in a higher gross revenue per acre.
Falling Prices plus dockage
During planting soybean prices were $11.60 and higher up to over $12.00 a bushel in late May. The market began a downward trend until late August. Since then, the price has had a slight upward bounce, but still well below $11.00 and pushing a close below $10.00. Basis in NE Arkansas has continued to remain wide and variable, only increasing losses for the farm operations and landowners who are sharing the crop. An already tough situation with dropping prices has simply turned for the worse as the damage discounts of$1 to $2 or more per bushel are revealed.
We are experiencing wide ranges of damaged soybeans on our farm. I am hearing of farmers with dockage percentages up to 50% damage soybeans in a load. Of course, this does fluctuate GREATLY depending on where you may be delivering. We have seen grades double and triple from the same field simply from delivering to different purchasers. You might ask why is there such a difference in the grading standard of damaged soybeans?
Why are the grades so variable?
First, as a buyer of soybeans myself, I have personally graded millions of bushels of soybeans in my career. It is extremely important for an elevator to be consistent in their grading. We are a small company and have the ability to have one person grade over 90% of our incoming loads. This takes out the question of subjectiveness. We strive to be fair to the farmer and treat every load the same. I am a farmer, and I understand how it feels to be the last person in line when prices get cut. A farmer has nobody else to pass that loss on to so it is helpful when there is standardized grading at a facility.
That stated, there are no two samples even from the same load that will be the same. Portions of a field may have had excess water or drought or herbicide drift. There can be many reasons soybeans become damaged. However, it is clear the cause of the damage in the 2024 soybean crop- hurricanes.
Farmers know what their product looks like and whether it is excellent quality or not, whether the quality is getting better or not. Therefore, it is difficult to stomach when grading becomes tougher as more loads of poor quality come to an elevator. However, as the quality improves so should the discounts. Just because the grading is subjective, and we all know it, there should be a level of integrity in the consistency of the grading.
What can a farmer do?
Through many calls and conversations, I have learned that for a county to be declared a disaster to the crops from a weather event FSA needs to report the event. If you have any photos or proof of damage to your soybeans, contact your local FSA office. They will work with the county agent and other soybean specialists in your state to determine if the loss is large enough for any declaration.
Farmers need this declaration to be able to participate in any USDA disaster programs that may become available. There is talk of ad hoc disaster assistance related to the hurricanes so we must act. Now is not the time to be quiet about the conditions of your soybeans if they are damaged. I know most farmers do not want others to know when they are having troubles, but this is WIDESPREAD. It will be better to share this information than to wait and see what may happen.
I am not sure what constitutes a crop disaster, but as we are in the middle of this battle of high yields, falling prices and discounts it certainly feels disastrous. Please comment below what types of discounts you are receiving, your location, and how it may hurt the profitability of your farm for the 2024 crop year. If you have any questions please email me at fieldgoodlife@gmail.com