Do Farmers Need to Hedge Against High Input Prices?

USDA's top economist, Seth Meyer, says crop prices are still high enough for many producers to justify paying these very high prices for fall application fertilizers for next year's crop.

"But the last thing you want to do is put out a bunch of money for fertilizer and then see corn prices drop and be unhedged against those higher fertilizer prices."

Meyer said that some analysts are expecting crop prices to be a little lower next year; input costs even higher than they are now, and so, "if you're spending this much on fertilizer, you might consider locking in some of these higher corn prices.  You don't have to put it all on the table, right?  Because there is a risk because you don't know how much of a crop you're going to get."

But, Meyer noted, that would help incase crop prices do come down next season. His other advice, which he says most farmers are already going to be doing, but it's worth saying for next year.

"You're gonna want to watch your cost side."

That's one thing over which farmers at least have some control.

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