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Corn grower stretches input costs

By Jennifer M. Latzke

Thanks to the vast expanse of the Ogallala Aquifer, irrigated corn production in the Texas Panhandle is possible. But farmers are hopeful that future releases of new biotech corn varieties with drought tolerance may help improve their bottom lines, as well as conserve precious water resources.

Wesley Spurlock, of Stratford, Texas, is a grower who spends his winters carefully weighing his varietal options against his input costs before any final planting decisions. Spurlock and his family--wife Susie, son Walter and daughter Jennie--farm 9,000 acres of center pivot-irrigated land in Sherman County. They rotate corn with cotton, winter wheat, triticale seed and seed sorghum.

For Spurlock, each corn season begins with planning for many variables. He carefully considers his corn variety choices, the expected cost of inputs, and his available water, to name a few.

Planning for drought

Variety selection is the first key to Spurlock's success in managing his risk. He plants 100- to 110-day corn varieties, usually in late April to mid-May, and takes his climate into account when he's selecting his seed.

"We have to select for drought-tolerant varieties, and all companies have good varieties for each area," he said. "We have to make sure, though, that we are prepared for a drought at planting. You don't go into the season thinking you'll get 16 inches of rain, when you wind up with none." As an irrigated grower, Spurlock closely manages his gallons of water use per minute, and the more drought-tolerant a corn variety, the better. He accounts for his soil types in each field, and how much water is available for irrigation on that field.

"There are new genetics every day, and these seed companies are always coming out with new varieties," he said. And as seed technology advances and drought tolerances rise, Spurlock and his neighbors are ready to use it, if it will mean lower input costs for irrigation.

Stretching the input dollar

Stretching the input dollar when growing corn is important, especially in the Panhandle, where the average rainfall is less than 16 inches, and pumping water is expensive and regulated.

A few years ago, the North Plains Ground Water District, where Spurlock farms, started regulating the amount of water farmers could pump, and gathering data on the acre feet of water produced on each well. Farmers are allowed to pump up to two acre feet of water currently, but that may decrease to one and a half acre feet in the future depending on the status of the aquifer. Besides decreasing water stocks, though, is the rising cost to pump that water to the surface.

"The major expense with irrigation in this area is the natural gas and fuel costs that keep escalating," he said. In 2008, Spurlock and his neighbors saw fuel bills averaging $200 to $350 per acre, just to pump water.

"It'll take drought tolerance to improve our profitability again, to a level that we can deal with high energy prices," Spurlock said. "It wasn't bad, up until we planted last year, and then they exploded."

"Fertilizer prices exploded, and there is so much out there that we need to use up at those high prices before we can go back to more normal levels," he said. "Three things catch us--fuel, fertilizer and the futures price of corn. Fuel and fertilizer are the most volatile, and the biggest part of the puzzle to deal with."

Other variables

Panhandle crop land is becoming more competitively priced, after many years of stable land prices. That increased competition from dairies and outside investment means farmers must be even more vigilant in their production decisions.

"When dairies came into the western part of the county, we saw a bump in our land prices, almost two times of what they had been," Spurlock said. Outside investors have also been pooling money and putting it into farmland.

"They see it as an investment for the long term, and most are fixing and upgrading those farms," Spurlock said. "They aren't fixing it up to sell right away either." Farmland, it seems, is doing better than some other investments in today's economy.

The challenges of farming

Spurlock enjoys the challenges of raising corn in the Texas Panhandle. But, he also knows when he needs to ask for outside advice. He works with two crop consultants and a fertilizer consultant, who help him make production decisions. "We highly value our consultants," he said. They keep up on the changing research in crop production and chemical usage, and the insect and weed pressures in the area.

"Any time you're taking on a new project, you need to visit with the people who are most successful in that project," Spurlock said. "Learn from them and acknowledge that you may not know as much as they do."

Jennifer M. Latzke can be reached by phone at 620-227-1807, or by e-mail at jlatzke@hpj.com.

Date: 2/6/09



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