2016 Nebraska Corn Production Net Income Risk

Nebraska corn producers are entering the production year with low grain prices, uncertainty associated with both harvest prices and yields and high production costs resulting in increased chances of financial losses than recently experienced. To help manage the risk of experiencing large financial losses, producers can purchase crop insurance which acts as a source of income when crop revenue turns out to be low. However, not all financial losses can be fully protected by crop insurance; therefore, producers are required to pick up the remainder in order to survive. The intent of this article is to provide guidance on financial risk exposure from producing corn in 2016 in Nebraska, how crop insurance can help, and more importantly derive reasonable expectations on how much money producers can expect to lose in case of experiencing a low revenue event