After an extremely dry 2023, frequent rains from mid-April through mid-May were a welcome sight across the Midwest this spring. The abundant precipitation helped alleviate drought conditions and restore soil moisture levels to normal in most areas. However, the rains also delayed corn and soybean planting progress compared to last year's ideal conditions.

As of June 2nd, only 91% of the U.S. corn crop and 78% of the soybeans had been planted, behind the 5-year averages. While planting is nearly complete, some acres may go unplanted if conditions don't improve soon. Producers have preventive planting coverage through crop insurance to mitigate this risk.

Current cash corn and soybean prices in Central Iowa are around $4.60/bu and $11.75/bu respectively. While still at historically strong levels, that marks a $2.40/bu drop for corn and $3.00/bu drop for soybeans compared to a year ago.

Prices have improved modestly since the February lows as commodity traders have unwound some short positions. However, higher projected ending stocks from increasing global production and improved crop genetics are keeping a lid on prices despite the planting delays.

The average 2024 cash rental rate in Iowa stayed at $279/acre, supported by higher farm incomes over the past two years. Since 2022, rental rates have increased 9% or $23/acre on average.

Looking ahead, rental rates may face downward pressure in 2025 if grain prices don't improve or yields can't offset the lower prices. Flexible cash rent leases are recommended to allow landowners to participate in potential upside.

The GREET model from Argonne National Lab measures lifecycle carbon intensity and could be used to administer clean fuel tax credits from the Inflation Reduction Act. This creates an opportunity for corn and soybean producers to receive payments through ethanol plants by implementing practices like no-till, cover crops, and enhanced efficiency fertilizers.

Collaboration between ethanol plants and grain producers will be needed, as the plants receive the tax credits but rely on low-carbon feedstocks from farmers. Producers can determine their carbon intensity score now to prepare for potential future payments.

As the 2024 growing season progresses, farmers across the Midwest will need to navigate the impacts of planting delays, fluctuating markets, and emerging opportunities like carbon intensity scoring. While challenges remain, the return of more favorable moisture conditions provides hope for a rebound after last year's drought-stricken yields. By staying informed and proactive, producers can position themselves to capitalize on the upside potential, mitigate risks through tools like crop insurance and flexible rental agreements, and explore new income streams tied to sustainable practices. The resilience of the agricultural community will be tested, but the outlook remains cautiously optimistic.

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