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The U.S. marketing year average corn price for 2019-20 is projected to be $3.60 per bushel. In contrast, the forecast for the 2000-21 marketing year is only $3.20 per bushel. This large decline in corn prices leads to several questions: Why have corn prices declined so sharply? What factors could keep corn prices at their current levels? And, what is the impact of lower corn prices on feed costs?
Feeding cost of gain is one of the most important factors explaining changes in cattle finishing. The recent volatility in corn prices leads to questions regarding the impact of lower or higher corn prices on feeding cost of gain. In addition to corn prices, feeding cost of gain is impacted by changes in forage prices and animal performance. This article examines trends in feeding cost of gain and the sensitivity of feeding cost of gain to changes in corn price, alfalfa price and feed conversion.
