Rising fertilizer costs and low commodity prices challenge local agriculture this spring
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As we inch toward spring planting, I can only imagine a lot of you have sharpened your pencils down to the eraser as you have been working the numbers to make some last-minute decisions on what you will plant and what inputs you will choose to invest in.
Our commodity prices are not what one would consider strong. When we combine that with the escalating cost of fertilizer, specifically nitrogen, it is hard to be overly optimistic about our farm economics this year. As we struggle through a difficult decision process, I often think we can find some clarity in focusing on the basics. For me, the basics are taking rational steps necessary to reduce both our production and marketing risk.
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I know you have heard this time and time again, but it is vital you use all the tools available to you to mitigate your risks. It starts with understanding your cost of production and what each input contributes to your profitability.
The Ohio State University Extension offers several tools for you to take advantage of to help you in this. The first is our 2026 Enterprise Budget tools that can be found on our Farm Office website at farmoffice.osu.edu.
I took some time to plug the current average price for fertilizer and the expected cash price at harvest for the three major crops we grow — corn, soybeans and wheat — into the OSU 2026 Enterprise Budget. Regardless of yield, all the commodities appear to be able to cover their variable costs but also showed it will be difficult to cover total costs on average.
The next is the corn nitrogen rate calculator at cornnratecalc.org, which allows you to see the economic return for your applied nitrogen based on current prices. The calculator is a valuable tool that has been developed by Ohio State and several of our Midwest peers to assist producers in identifying economic nitrogen rates based on nitrogen and corn prices.
The tool has been evaluated over the last 20 years and has consistently shown that, on average, an Ohio corn crop needs approximately 150 units of nitrogen. The tool supplies you with an application range where there is the greatest return on investment, though not necessarily the greatest yield.
For our wheat growers, outside of the expense of nitrogen for top dress, the other big decision is whether or not to make a fungicide application to manage headscab loss. Your headscab risk is determined by weather patterns as we approach flowering. When the weather is favorable for a high level of infection, a fungicide application is warranted to protect yield and reduce the potential for vomitoxin production.
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Fungicide applications should be targeted for flowering or, at the very least, four to six days after flowering. To help determine your risk, there is the headscab prediction tool available through Penn State University at www.wheatscab.psu.edu. This tool will allow you to look at our region, and as we approach flowering, it will give you an estimate of the risk of infection. If the risk is low, you can consider not making an application, or if it is high, an application will be necessary.
Finally, because you will put considerable effort into making those important crop management decisions, you also should put in similar effort for your marketing plan. I always encourage producers to develop a written marketing plan. A written plan allows you to identify your price targets and projected sale dates.
You indicate the tools you will use to price your commodity, and most importantly, as you make sales or choose to forego a sale, you will record your reasoning behind the decision. This allows you to analyze your decision-making process to understand what you got right and where you can improve.
I recommend you check out the sample marketing plans from the University of Minnesota’s Center for Farm Financial Management at www.cffm.umn.edu. Ed Usset has been posting example marketing plans for several years. They are easy to follow and provide a great starter for you to develop your own plan.
Ohio State University Extension will host a four-night Small Farm Business College beginning April 8. All four sessions will be held from 6:30-9 p.m. at the Fisher Auditorium. There will be a variety of farm business topics related to goal setting, evaluating your resources, budgeting, tax planning and ag law considerations.
The registration fee is $60 per participant, which covers materials and dinner at each session. Complete program information can be found on our website at wayne.osu.edu under the Events tab. If you have any questions about these programs or questions in general, call me at the OSU Extension Wayne County at 330-264-8722.
John Yost is an ANR educator with Wayne County OSU Extension.