High crop prices lead to reduction of protected land

Posted by IronPlanet on Apr 2, 2012 7:08:00 AM

High prices for crops are resulting in a reduction of lands protected under the federal Conservation Reserve Program (CRP), reports Reuters.

The CRP pays out nearly $2 billion annually to farmers who own land that the government would like to keep preserved. In exchange for not using the land for planting crops, the government pays the farmers a stipend, essentially leasing the land to protect it.

However, the news source reports that with the high price of commodities this year, many farmers are finding it more economically attractive to instead use that land themselves, or lease it to another farmer. That's the case with 18-year-old farmer Justin Zahradka, who will be planting on land that he leased from a farmer who opted out of the CRP. Overall, 1.7 percent more acreage will be used this year for planting than last, and the total land protected by CRP is at its lowest point since 1988.

"Obviously there isn't any more land being made," Zahradka told the news source. "With the high commodity prices, there's an interest in gaining more land to get a greater profit."

Those planning to plant more this year will need tractors to get the new fields plowed. The online auction site IronPlanet offers a safe way for farmers to buy used agricultural equipment online, with all of their equipment backed by full inspection reports through IronClad Assurance.

Topics: Industry Headlines