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Corn golden in Mississippi

Corn has become a very attractive crop in Mississippi, thanks mostly to the growing demand for corn-derived ethanol, an alternative fuel. Erick Larson, grain crops agronomist with the Mississippi State University Extension Service, said producers have tremendous interest in planting corn this season.

“Prices are approaching twice the long-term average,” Larson said, and the state may have the largest corn crop it has had in more than 40 years.

“U.S. corn production is a little more than 10 billion bushels, and right now we’re consuming about 1.5 billion bushels for ethanol,” Larson said. “That’s about 15 percent of the U.S. crop being consumed by a new market, and there are projections that ethanol production could quadruple in the next few years.”

Mississippi corn is used for feed, with about 75 percent of that use going to support the state’s poultry industry. Even with poultry being the only significant demand on the state’s corn, Mississippi already consumes more than it produces.

By year’s end, an ethanol plant is scheduled to be operating in Vicksburg, Miss., and that could drive the state’s demand for corn even higher.

Larson said state producers are responding by planning a huge corn crop in 2007.

“The kind of acreage increase we expect wasn’t even on the radar screen last year, and seed companies were not prepared for the demand,” Larson said.

He said there should be enough corn seed for Mississippi farmers to plant as many acres as they want, but they will not all be able to plant the best hybrids.

“We’ll plant some hybrids less adapted than we would like,” Larson said. “We’ve always had the luxury of picking the best hybrids available, but this year, growers are being forced to purchase hybrids they have never tried or that have never been grown in the state or Mid-South region.”

Larson said growers who choose to plant a corn variety that has not been tested in Mississippi or that is not intended for growth in this part of the country may not be happy with the results.

“It could dramatically affect their profitability. If they plant a hybrid that doesn’t produce as it should, they will harvest a less productive crop than they should have had,” Larson said.

John Anderson, Extension agricultural economist, said corn acreage in Mississippi has stayed around 300,000 acres, but this year, that number is expected to jump to about 700,000 acres.

“If we plant that much corn, it will be the largest corn acreage in the state since the early 1960s,” Anderson said. “In recent years, our largest acreage was 630,000 in 1996.”

U.S. corn acreage will also go up this year from the 78.3 million acres planted in 2006.

“The million-dollar question right now is by how much. If I were to guess today, I would say U.S. corn plantings next year will be 87 million acres,” Anderson said.

Corn prices held near the $2-a-bushel mark in recent years, but rose dramatically through the fall of 2006 to their highest level since 1996.

“Prices jumped significantly after the January World Agricultural Supply and Demand Estimates report showed a tightening of corn supplies,” Anderson said. “Prices were pretty stable for nearly a month after that, but in the middle of February, corn futures again started to move sharply higher. As of Feb. 22, September futures were about $4.30 a bushel. Last September, this contract was trading for about $2.74 a bushel.”

While corn producers are happy for the sudden interest in ethanol, there is a downside. The state’s poultry, catfish, beef, hog and dairy industries also demand corn, and the high prices caused by increased competition for this commodity are dramatically increasing their feeding costs.

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