1234 - 3/2/2016 19:15

We produced about 13.5 billion bushels last year and we are projected to have a 1.84 billion bushel carryout on Sept 1. If the carryout dropped below 1.0 billion bushel the price would go from $3.50 to $5.00. That's a difference of 800 million bushel or 5.9%. If the ave. national expected yield was 168 bushel per acre then a reduction of 5.9% is 9.9 bushel per acre or 158 bushel per acre. 168 bushel per acre x $3.50 is $588 gross per acre. 158 bushel per acre x $5 is $790. We don't need anyone to actually suffer a substantial loss for all of us to make a lot more money. In fact, if anyone had a 40 bushel per acre yield reduction they could still make as much money as their normal expected yield.
This comes from the fact that at our current supply-demand situation the supply-price curve is so steep that we all could do better by doing a little worse.
By the way, you're a cow-calf producer? I'm surprised you don't fully understand this principle. When the calf crop was 35-36 million head the price was 60-80 cents per lb. Today the calf crop is what, maybe 26-27 million and the price is $2.20 plus? You lost 25% of your production and gained 370% on the price. Even with only 75% of your previous production you stand to make 270% more money.