The Corn Economy

Jul 18, 2024

Key Issues: Ethanol

Author: Krista Swanson

Scott Gerlt, PhD, ASA Chief Economist Krista Swanson, NCGA Lead Economist Katelyn Klawinsky, ASA Economics Intern   The Inflation Reduction Act (IRA), passed in August 2022, created a sustainable aviation fuel tax credit. This tax credit, called 40B due to its section in the IRA, is in effect for 2023 and 2024. The 40B credit amount is based on the carbon intensity from a lifecycle analysis for the specific sustainable aviation fuel (SAF) obtaining the tax credit. As such, lower carbon intensity (CI) biofuels receive a larger tax credit than those with higher CI scores[i].   While SAF can be produced from many different feedstocks, both soybeans and corn are options that can be used at scale. One option to lower the CI of the SAF is for corn and soybean farmers to implement specific conservation practices. Unfortunately, the requirements in 40B for conservation bundling severely limit the ability of producers to provide additional carbon intensity benefits to the 40B program....

Jul 10, 2024

Author: Krista Swanson

Corn farming is one of the largest sectors in American agriculture. In 2023, corn farmers in the United States grew 15.3 billion bushels of corn for grain valued at $73.9 billion. For the 2023/24 marketing year the United States is the world’s largest producer and exporter of corn. The nation’s corn farmers bolster the economy and help build strong communities as evidenced by the results of the Study of the Economic Value of Corn Farming in the United States for 2023.    The contribution of corn farming and linkages extended across 524 different industry sectors in all 50 states. Corn farming for grain generated an estimated $151 billion in total economic output in 2023, with an estimated contribution of $62 billion to Gross Domestic Product (GDP), making the industry an essential contributor to the nation’s agricultural and economic value chain. Driving the creation of over 600,000 jobs and providing $35 billion in wages, corn farming strengthens communities in rural America and...

Jul 8, 2024

Author: Krista Swanson

Challenges in Farm Country Large on-farm stocks, coupled with the latest corn acres projection, add downward pressure on already below break-even prices. The United States Department of Agriculture (USDA) released two major reports and another key dataset in the second half of June. Together these pieces of information add clarity to the challenges corn farmers are facing right now.   The June Stocks Report The UDSA June Stocks Report provides an estimate of the total corn held in commercial storage facilities and by producers on their farms as of June 1. For 2024, USDA estimates total U.S. corn stocks at 4.993 billion bushels, 21.7% higher than a year ago. Aside from the years 2017 to 2020, when the country experienced trade wars and COVID ravaged the world, this is the highest total stocks level since 1988.   Even more notable was the increase in corn on farms. The report shows farmers have 3.026 billion bushels of corn in possession as of June 1, 2024. This is 36.5% more...