Corn Economics
Controlling costs is always one of the most important tasks for any business. This is very true for production ag also. Minnesota Farm Management figures show that for producer owned and operated farms, the 20% of producers in the highest profit category have a cost of production of $2.48/bushel. The 20% of producers in the lowest profit category have a production cost of $4.43/bushel.
For farmers that rent their ground, the highest profit group has a corn production cost of $3.25/bushel, compared to $5.03/bushel for the lowest profit group.
These numbers underscore the importance of controlling costs by managing input costs, and also the importance of achieving high yields to reduce the price per bushel cost.
Two ways of assuring a high cost of production is to pay too much for cash rent and having high per acre machinery costs.