By Jonathan LaPorte
As spring weather begins to arrive, final planting intentions start to take shape on many farms. One key source of guidance that farmers often use for planting decisions is the corn/soybean ratio and its view of which crop offers a better price. However, the corn/soybean ratio can provide mixed signals. For example, based on the latest national price estimates (February 2026), corn is slightly more favorable with a ratio of 2.49, while average cash prices for Michigan suggest soybeans may be better with a ratio of 2.59. Recent market volatility and high operating costs only add to these mixed signals, which makes price alone as a deciding factor misleading. A better method is to consider your farm’s profit margins and ability to cover costs.
Profit margins are an important part of identifying potential profits and can be a strong guide for planting intentions. Crops are raised to be marketed at profitable prices. Profitable prices mean that operating costs are covered and the farm has money left over for its cash flow needs, such as debt payments. Of course, profits can also be used for non-farm expenses, such as any family living costs the farm will provide. Looking at profit margins on a per bushel basis helps to determine if market prices offer enough profit for these additional needs.
Source : msu.edu