Organic, non-GMO options offer price premiums for farmers willing to take on some new management practices.
Farmers can make about $10 per bushel for growing organic corn and $20 per bushel for organic soybeans, according to Ken Dallmier of Clarkson Grain, which offers contracts on both as well as non-GMO crops. (Illinois Farm Bureau file photo)
By DeLoss Jahnke
While commodity prices continue to hover near production costs, one of the conference speakers at this week’s Illinois Farm Bureau Farm Income and Innovations Conference was ready to welcome new farmer customers with open arms and offers of better prices.
“The current price for organic corn, No. 2 yellow, is around $10 (per bushel),” said Ken Dallmier, president and chief operating officer of Clarkson Grain in Cerro Gordo. “And organic soybeans are around $20.”
Those crops cannot be hedged, he noted, which also means they’re not as volatile. Prices are contracted with producers prior to planting.
“I think it allows the producers to diversify their operations. It allows them to take advantage of some markets that are not so influenced by the current trade volatility,” Dallmier said on the “RFD Today” program on the RFD Radio Network®, adding that there is room for more customers in the near term without saturating the market and shrinking price premiums.
“Much of the identity-preserved, and certainly on the organic side, are utilized domestically,” he continued. “Those are also, in many cases on the organic side, flat-base contracts, so they are quite insulated from that board-market volatility.”
The United States imports about half of its organic corn and about 70 percent of its organic soybeans, including some from China.
Clarkson Grain is also in the non-GMO business, which also offers price premiums.
Communication is key for farmers transitioning to different management practices, Dallmier said. “You have to have a great understanding with your grower. You have to understand some of their Year 1 challenges. And you have to take the long-term view and how you treat your end-users.”
Content for this story was provided by FarmWeekNow.com.