Supply and demand factors have recently coalesced in a way that has caused the market price of several key program crops to increase substantially.
These higher market prices have turned attention to a wide range of important issues including energy policy and biofuels, food inflation, and conservation program management.
Some might argue that corn is one of the more important variables in the current high price environment. Corn is a versatile crop that is used for a variety of purposes, and acreage decisions regarding corn has ripple impacts on the supply and price of other commodities.
As a result, corn yields and more specifically, estimates regarding the projected growth rate in corn yields, has taken on an important role in the farm policy debate.
Last year, the U.S. average yield per acre of corn was about 150 bushels, and there is agreement that corn yields have generally increased over time (see related graph).
The more important policy issue in the current environment is the rate of growth in corn yields: Are corn yields increasing at a faster rate?
Agricultural economists at the University of Illinois have looked at this issue in greater detail and have summarized their results in a short, easy to read paper entitled, “Are Corn Trend Yields Increasing at a Faster Rate?”
I recently had a chance to sit down and speak with Scott Irwin, one of the co-authors of the paper.
Professor Irwin not only explained the results of the paper, but also tied in how these conclusions might be used for additional perspective in the current policy debate.
To listen to an audio recap on this issue, which includes my conversation with Professor Irwin, just click here (MP3- about 8 and half minutes).
The audio recap also includes a brief audio excerpt from a speech made recently by Rick Tolman, the CEO of the National Corn Growers Association.
To listen to the recap, just click here (MP3).