Editor’s note: The following was written by Gary Schnitkey, Krista Swanson, Nick Paulson, and Jonathan Coppess with the University of Illinois and Carl Zulauf with Ohio State University for the University of Illinois farmdoc daily website Nov. 2.
Many factors will influence the overall corn-soybean acre ratios in Crop Reporting Districts (CRDs) across the Midwest. Two factors explain much of the variability in the I-states (Illinois, Indiana and Iowa), which are the heart of the Corn Belt:
- Average corn yield — CRDs with higher average corn yields are associated with higher corn-soybean acre ratios.
- Corn yield relative to soybean yield — CRDs with higher corn yields relative to soybean yields are associated with higher corn-soybean acre ratios.
As corn yields increase, corn tends to be more profitable than soybeans. Similarly, as corn yields increase relative to soybean yields, corn tends to be more profitable.
In a regression analysis, the above two factors explain 61% of the variability in corn-soybean acres’ ratios in the I-states. In these states, corn and soybeans are the major crops, accounting for over 90% of acres. Irrigation is used on a small number of acres.
Outside the I-states, the explanatory power of the two variables goes down considerably. Other factors likely influencing decisions include:
- Prevalence of other crops — Crops other than corn and soybeans are more prevalent in the Great Plains and Upper Midwest. Wheat has higher acreage shares outside of the I-states and is often used in a rotation with soybeans.
- Prevalence of livestock and dairy — Corn may have more acres where livestock and dairy have traditionally been more prevalent. Wisconsin, for example, has dairy and higher values of corn acres relative to soybean acres.
- Prevalence of irrigation — Irrigation may influence decisions and economics of corn versus soybeans. Corn is more prevalent where more acres are irrigated in Nebraska and Kansas.
Acres planted to corn and soybeans were obtained for CRDs from Quick Stats, a website maintained by the National Agricultural Statistical Service (NASS). Planted acres were averaged from 2015 to 2019 for both corn and soybeans. Then, average corn acres were divided by average soybean acres to arrive at ratios of corn-soybean acre ratios.
A ratio value of 1.0 means that corn acres equal soybean acres. Values above 1.0 indicate that corn acres exceed soybean acres, typically a result of more corn-after-corn acres, particularly in the heart of the Corn Belt. Values below 1.0 indicate that soybeans exceed corn acres, likely driven by more frequent rotations of soybeans-after-soybeans or use of double-crop soybeans in a rotation with a winter crop in these CRDs.
Several areas have values above 2.5. The upper part of Michigan has several CRDs with values above 2.5. Central South Dakota, central Nebraska and western Kansas have higher values.
Values above 2.0 are predominant in Wisconsin. A line of CRDs from northeast Wisconsin and northwest Illinois to northeast Iowa had ratios above 2.0. Then values tend to become lower for CRDs away from this line. Similarly, there is a line of high ratios in central Nebraska and western Kansas.
Two areas have ratios below 1.0. CRDs in North Dakota, South Dakota, and upper Minnesota have values below 1.0. Ratios also tend to be below 1.0 from Ohio, through eastern and southern Indiana, southern Illinois, Missouri and eastern Kansas.
For CRDs east of the Mississippi, higher ratios are associated with northern CRDs. Ratios then decrease for more central CRDs, reaching lower levels in more southern CRDs. The same holds for southern Minnesota, Iowa and Missouri.