by Nathan Hulinsky, Extension educator, Agricultural Business Management
Feed cost is the most important and expensive input cost on a dairy farm. For a combination of reasons, feed costs have risen sharply since the fall of 2020. At Central Grain in Sauk Centre June corn prices are around $6.70 with a positive $0.10 basis, with higher positive basis for late summer. Soybeans are around $15.00 with negative $0.40 basis. These are very competitive bids. Futures prices this fall are currently several dollars per bushel lower than nearby contracts. If you have any excess grain, consider contracting it for sale this summer.
However, if you own livestock and are buying crops for feed at these prices, things do not look as rosy. For a historical reference Table 1 shows the feed cost per cwt according to FINBIN data from the Minnesota dairy farms over the past 12 years. This is the yearlong average, so the monthly highs and lows are not captured, but we can see the increase from 2009 and 2010 into the high commodity prices of 2011-2014, and the decrease after that.
Table 1: Feed Costs.
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