Crops may help Minnesota farmers rebound

From corn to soybeans to sugar beets, Minnesota farmers are looking at bumper crops this year.

They've benefited from good weather and a particularly mild spring that allowed for early planting. And wheat growers are particularly in the green, as prices for that grain have rocketed over the past several weeks.

Meanwhile, livestock and dairy farmers -- who mostly lost money last year -- are back in the black in 2010.

The upshot: "Farm income trends should be very good this year," said Michael Swanson, an agricultural economist at Wells Fargo in Minneapolis. "It's a very positive outlook right now."

U.S. corn production is forecast to hit record highs this year, including in Minnesota. The state's corn crop is expected to be 1.25 billion bushels, up slightly over last year, with a yield of 178 bushels per acre, an increase of four bushels over 2009, according to data released Thursday by the United States Department of Agriculture's Minnesota field office.

The state's soybean production is forecast at a record 326 million bushels, up 14 percent from last year. Soybean yields are expected to be 44 bushels per acre, up four bushels from last year, according to the USDA.

"Minnesota's corn and soybean crops look really good," said Dale Durchholz, senior market analyst at AgriVisor LLC in Bloomington, Ill. Minnesota is the nation's fourth-largest corn grower and third-biggest soybean producer.

Wheat prices have jumped about 70 percent this summer, as about one-third of Russia's wheat crop shriveled during the hottest summer there in about 130 years. Bad weather in Ukraine and Kazakhstan -- both big wheat producers -- has also put upward pressure on prices. Russia is the world's third-largest wheat exporter after the United States and Canada.

Wheat prices particularly shot up in late July and early August, so farmers who earlier this year sold their crops forward through futures contracts -- a common practice -- missed out on some of the windfall.

Still, the majority of Minnesota growers are going to benefit from these high prices, said Dave Torgerson, executive director of the Minnesota Association of Wheat Growers.

Hog and cattle prices have also been on the upswing this year, as have dairy prices -- welcome news after a miserable 2009.

A grim year in livestock and dairy farming, coupled with a decline in crop farmers' earnings, led to a 63 percent drop in median net farm income in 2009 to $33,417, the lowest mark since 2001, according to an annual study by the Minnesota State Colleges and Universities system and University of Minnesota Extension.