Less or More: Will the real dry bean acreage trend stand up?
January 15, 2003
Editors Note: The following is excerpted Michigan Bean Commission News, October 2002
Is the jump in acres of the 2002 crop of beans in Michigan going to be the norm, or has the recent trend of decreasing acres of beans in Michigan the real trend?
Some things to think about. The trend would certainly be down for both the total beans and navy beans, but even more interesting is that navy beans as a percent of total beans continues to decrease as well.
Of course, if you put black beans in the same comparison, it would show the opposite trend, i.e., that black beans are growing as a percent of total beans planted.
As in every year in the dry bean business, the next year will tell it all. This does have more credence this year for several factors. One is certainly competing crops and the availability of LDP in the U.S. Last year we saw soybeans remain competitive in the U.S. rotation because of the LDP payment, while our main competitor (Canada) did not have the LDP advantage. At this point, with soybeans currently being bid at $5.25 and wheat currently at $3.95, it does not look like the LDP values will kick in.
Of course, our main competitor for dry bean acres will now have equal price status with the U.S., meaning no direct payments for crops from the government (basis differences remain though). Will the Canadian grower go back to the traditional wheat crop?
Soybeans have made inroads into the North Dakota and Canadian rotation as well. Will the price increases for soybeans and wheat loom advantageous to both the North Dakota and Canadian grower? Will price increases for soybeans and wheat present the Michigan grower with another reason to drop dry beans as well?
Of course, all of this assumes both a stable (depressed) navy bean market and a stable colored bean market. If a stable price environment does continue, does that mean North Dakota and Canada will continue to advance their acres?
While the pricing structure for many dry beans has not been advantageous to the Michigan grower, the Canadian and North Dakota grower feel the same. Add to that the traditional lower yield these areas obtain, plus the additional risk factors associated with the production of dry beans that we all face (frost/rain/drought/cold/heat/disease), wont increases in soybeans and wheat in all areas be the "new" norm?
Which, of course , says, "wont dry bean planted acres in all areas have to suffer?"
At what time do canners have to step up their contracting to insure that enough dry beans are grown?
When does mother nature and traditional weather patterns start to plague the other bean growing areas?
While I have probably not answered many questions about the future of dry beans in Michigan, hopefully I have raised questions that, as you define answers for them yourself, your answers will help you decide your future in the dry bean production in Michigan.