Fall 2016 Wheat Planting Decision

                  Kentucky grain farmers are harvesting corn and are getting to the point where they will decide if and how much wheat they will plant this fall.  In Kentucky, wheat is almost always planted in the fall following the harvest on corn ground, and then double-cropped with soybeans in early summer after the wheat harvest.  This allows for two crops in one year.  However, soybeans planted after the wheat harvest are more susceptible to summer drought, which means on average yields are lower for these double-cropped soybeans.  In Kentucky, this yield reduction typically averages around 20% and needs to be factored into the overall decision along with grain prices to determine if double-cropping makes sense in a particular year. 

A major change this year is a continued drop in wheat prices while soybean prices have actually increased slightly.  This will make planting wheat less attractive this fall.  The following analysis attempts to quantify the extent of the relative change in profitability for 2016.  The analysis includes estimated returns comparing double-cropped wheat/soybeans with full-season soybeans for the 2016 crop, and the likely implications for Kentucky grain farmers.

Additional costs associated with the double-cropping are accounted for, including fuel, machinery repairs and depreciation, labor, hauling, etc.  2016 new crop CME future’s prices in early October, 2016 are used as the base, and are adjusted for a basis of -$.20 for soybeans and -$.15 for wheat.  This results in new crop prices of $9.50/bu for soybeans and $4.25/bu for wheat.  Two regions with different agronomic characteristics are evaluated. The first region is along the southwest tier of counties near Hopkinsville, which traditionally does a lot of double-cropping.  The second region is along the northwest tier of counties (Ohio Valley region) that has some of the best yields for corn and soybeans, but traditionally plants less wheat.  Cash rent is assumed to be $175/acre for both these regions (note: this will vary substantially, but is done here for illustrative purposes only).  Net profit is estimated after subtracting out all variable and fixed costs represented by an efficient operation.  Major assumptions are: $2.00/gallon fuel, 25 mile one-way grain hauling, $.35/unit N, $.30/unit P, and $.25/unit K.   


Southwest Tier Assumptions (Average Ground):

70 bu wheat

35 bu double-cropped soybeans

44 bu full-season soybeans

Resulting net profits:

  -$99 double-crop

  -$31 full-season soybeans


This results in a $68 difference in favor of the full season soybeans.  The double-cropped soybean yield would have to increase to 42 bu before wheat/double-crop soybeans were as profitable.  This would amount to only a two-bushel yield reduction over full-season soybeans.


Southwest Tier Assumptions (Best Ground):

90 bu wheat

44 bu double-cropped soybeans

55 bu full-season soybeans

Resulting net profits:

  +$72 double-crop

  +$71 full-season soybeans


This results in basically the same profitability as full season soybeans. 


Northwest Tier Assumptions:

65 bu wheat

38 bu double-cropped soybeans

50 bu full-season soybeans

Resulting net profits:

  -$91 double-crop

  +$25 full-season soybeans


This results in a $116 difference in favor of the full season soybeans.  The double-cropped soybean yield would have to increase to 50 bu in this case before the wheat/double-crop soybeans were as profitable.  This would equate to the same yield as full-season soybeans.

Given the current market conditions, double-cropping doesn’t look remotely attractive in 2016-2017 for the majority of Kentucky.  On the very best wheat ground in the state it looks to be a breakeven situation compared to full-season soybeans.

This analysis doesn’t account for potential payments from the ARC and PLC Farm Bill programs.  However, these programs would pay on base acre crop allocation and not planted acres, so there would be no effect on the planting decision.   

To change the assumptions above to your specific conditions and evaluate your expected profitability, go to the grain budget site at: http://www.uky.edu/Ag/AgEcon/halich_greg_rowcropbudgets.php

The Corn-Soybean Budgets and Wheat Budgets can be downloaded or opened directly from this page.

Source:  Greg Halich

Fall is a Great Time to Sample Soils

Fall is actually the optimum time to take soil samples for fertility analyses.

Fall sampling gives you plenty of time to follow fertility recommendations before planting season. As soon as you receive the soil test results, look at the recommendations for lime and pH.  Applying limestone neutralizes soil acidity. Because agricultural lime takes about six months to break down and react with the soil, it should be applied in the fall to be fully effective in the spring. Unlike fertilizer, lime is needed every three to five years, depending on your crop rotation and nitrogen fertilizer history. 

If you’re interested in collecting fall soil samples, stop by the Extension office. We can give you more information including details on how to take accurate soil samples and where to send the collected cores.

 Agriculture & Natural Resources

at Extension

With more than 1500 farms and average annual cash receipts of $76.8 million, Shelby County's oldest industry is still going strong!  More than 199,000 Shelby County acres are devoted to the production of livestock, grain, vegetables, tobacco, hay, fruit, honeybees and horses.  Extension agriculture programs serve to connect producers and consumers with the latest research-based information from the University of Kentucky and Kentucky State University.  We are your source for information and guidance to develop and grow your operation.  Check back often for upcoming programs and activities!


     The HAAC meets quarterly (March, June, September and December) on the first Tuesday at 6:30 p.m. at the Extension Office. This is a great group of visionary volunteers who are helping to guide our Extension programs into the future. We are sharing and learning from one another in the process!

     HAAC members are currently working to develop the four-year plan of work for extension ag and hort programs.  A committee is developing a survey to use regarding the long-range comprehensive plan for agriculture and horticulture in Shelby County.  If you would like to complete the survey, call 633-4593 or check back here for a link to the online version.