Chief Illiniwek - 12/23/2024 11:41
At the end of the day, the math is:
Total gross revenue
-expenses to grow a crop
-rent
= as close to zero as the local BTO wants to cut it.
I'm following you up to this point.
Chief Illiniwek - 12/23/2024 11:41
So if you start with 250 bu corn at $4.50, you’ve got $1125 to work with.
Good here too...
Chief Illiniwek - 12/23/2024 11:41
I don’t feel like getting into a peeing contest about machinery, crop inputs, fuel etc so let’s just pretend it costs about $500 to pick an arbitrary number.
I mean...I agree we don't need a peeing contest. But are you saying my expenses to grow 125 bushel corn (not including rent) are the same as your expenses to grow 250 bushel corn? It kinda reads that way but surely that's not what you're saying.
Chief Illiniwek - 12/23/2024 11:41
That leaves you $625 an acre to make a little money and pay the rest to the landlord.
This makes sense.
Chief Illiniwek - 12/23/2024 11:41
Well same equation works at 125 bu corn. You gross $562.50, probably a bit more since your yield goal is less.
My gross is higher than 125 x $4.50 because my yield goal is less? I guess I'm not following there. Additionally, without knowing basis in your specific area, I bet I have at least a $0.50 advantage to you on basis on average due to being in a corn deficit area compared to you being in a corn surplus area. If you're getting $3 cash, I'm likely getting $3.50 or more assuming we hit the futures the same and assuming we both do an equally good job sniffing around for decent basis and storing our grain and so on.
Chief Illiniwek - 12/23/2024 11:41
But obviously instead of $500+ rent, you’re at $100 rent.
NOW what happens with $3 corn. You still gross $750 on the 250 bu ground and can pay some rent.
I'm back to following you again...
Chief Illiniwek - 12/23/2024 11:41
Well all the sudden that 125 bu ground is under water even at free rent
It seems like you're saying my area is underwater by $125 at $3 futures without even accounting for rent. Due to the per acre cost to put corn in and harvest it being incorrect above, as well as failing to account for basis differences, this is nowhere close to correct. I'm not saying I'm making money at $3 futures. But I'm not losing so much that I'm going to skip planting next year because it hurt so bad (even after paying rent).
Chief Illiniwek - 12/23/2024 11:41
and that’s where a $43 dollar subsidy comes into play.
You do realize the subsidy is almost the same on wheat right? And sorghum isn't super far behind.
Chief Illiniwek - 12/23/2024 11:41
$43 is icing on a much bigger cake on productive ground, whereas on marginal ground it has you thinking should I risk paying inputs and buying machinery to plant this stuff.
All of my decisions about which crop to plant are totally independent of whether or not a government subsidy will happen. I pick the most profitable (or least loss) crop and I roll with it regardless of whether potential government subsidies end up materializing. | 
Does anyone have statistics on how many farmers actually want disaster payments and subsidies?
