Roundup Ready 2 Yield Soybean Pricing is Way Down in 2011 09/01/10 12:02:01 PM
As you begin gathering soybean seed prices and locking in next year’s seed, one of the first things you’ll notice is how everything is completely different from last year. The most striking example of that is with Roundup Ready 2 Yield (RR2Y) soybeans.
Last year around the 1st of the year we were selling our Hefty Brand Roundup Ready soybeans (RR1) for about $35/unit and our RR2Y soybeans for $55/unit. That was a $20/unit price difference, but it wasn’t comparing apples to apples. LAST YEAR all the RR2Y soybeans came with Acceleron seed treatment on them. That added $10/unit or more to the cost and gave you two new things to digest: a new seed trait and a new seed treatment. Needless to say, there was a little pushback on a $20 price gap and two new things that most farmers hadn’t tried before. Monsanto saw what happened and made some big changes for this year with the Roundup Ready 2 Yield soybeans...
- Seed treatment will NOT be included in the RR2Y soybean price this year, nor will seed treatment be required on RR2Y beans.
- The price gap between RR2Y and the original RR1 soybeans will be around $4 to $5 per unit.
When I heard this strategy, I was pretty excited. In my experience the RR2Y soybeans are typically out-yielding the RR1 beans by 1 to 3 bushels and in some cases up to 5 or 6 bushels. Even if the yield advantage was only 1 bushel per acre, the Return on Investment planting RR2Y looks pretty good.
- 1 bushel advantage X $9.50/bushel = $9.50 Gross increase in revenue
- $9.50 gain - $5/unit premium = $4.50 Net gain per acre
- $4.50 Net Gain/$5 Investment X 100 = 95% Net Return on Investment
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