Profits for farmers aren't expected to grow significantly in the near future, experts say.
That was the less than exciting news given to over two dozen local farmers from both Grant and Blackford County at the Purdue Extension of Grant County's "Fall Farmer Update" Wednesday.
Purdue University Professor of Agriculture Dr. Christopher Hurt gave farmers the bad news in a presentation.
According to estimates made by the university, farmer's revenue is expected to remain stagnant for at least a few more years.
That wouldn't be such bad news a few years ago, but in the past couple years corn and soybean prices - two of Indiana's biggest crops - have decreased significantly in the past decade, while operating costs have increased.
Though, Purdue University is projecting the gap between revenue and costs to slowly decrease over the next couple of years, Hurt said farmers should expect tight margins.
"It's time to tighten the belt buckle," he said.
Reasons for the prediction were varied and had both local and global reasons.
Despite Indiana having a record worst crop yield due to a record amount of summer rain, the majority of the other top six producers in the U.S. actually saw record years of crop yields.
States like South Dakota, Nebraska, Iowa and even most of Ohio saw great vegetative cover this past July, leading to better yields compared to last year.
The high supply of corn and soybean kept prices in the U.S. low, adding more woes to the Indiana farmer whose crop yields were typically significantly lower than other top producing states.
Only about 48 percent of Indiana's corn crops were rated "good" or "excellent by the United States Department of Agriculture. Of the country's other five largest corn producers - Iowa, Illinois, Nebraska, Minnesota and South Dakota - that was the lowest percentage with Illinois being the next lowest at 55 percent.
But, according to data and estimates from Purdue, stagnate crop revenues won't just be affected by the country but also the global market and supply.
Hurt said, while demand for corn is increasing, so is supply and at a too fast rate. Par that with a strong U.S. dollar, Hurt said, and a global economy that is also stagnating. And you get low prices and usually large buyers, such as China, buying more from South American countries like Brazil and Argentina where prices are lower.
"The world is just not buying," Hurt said. "That's just very scary."
It's not all bad news, though.
The university also expects costs for farmers, such as cash-rents, to decrease. While that probably won't be enough to fix the main issue, Hurt said if farmers can survive for the next three or four years, he expects the market to bounce back in the farmer's favor.
"Historically, we see trends like this, and if farmer can last through the bad four or five years, things usually get better," he said. "It's going to take cutting back and trying to lower costs."