"It also may be that weather conditions that resulted in the worst yields in recent history--1983 and 1988--have not re-occurred," said Gary Schnitkey, U of I Extension farm financial management specialist, who wrote the report "Has Variability in Corn Yields Been Reduced?"
The complete report can be read on U of I Extension's farmdoc website (http://www.farmdoc.uiuc.edu/manage/newsletters/fefo06_12/fefo06_12.html).
Schnitkey undertook the study after some suggestions that corn yields have exhibited less variability in recent years than in the past. He utilized data from farms enrolled in the Illinois Farm Business Farm Management (FBFM) Association to evaluate how yields have varied.
"Evidence suggests that widespread losses occurred in 1983 and 1988," he said. "Losses as large as in 1983 and 1988 did not occur in the 1990s or the early 2000s. However, yield shortfalls are still possible."
Corn yields from the farms enrolled in the FBFM program were used to calculate "relative yields," he noted. A relative yield equals a year's actual yield divided by the average of the previous four-years of yields, times 100. A farm with a yield of 120 bushels per acre, whose previous four-year average yield is 150 bushels, has a relative yield of 80 percent (120 bushels/150 bushels x 100).
"A relative yield of 100 percent means that the yield is equal to the previous four-year average, 120 percent relative yield means that the yield is 20 percent higher than the previous four-year average, and an 80 percent relative yield means that yield is 20 percent lower than the previous four-year average," he said.
Relative yields have crop insurance implications. The four-year average yield used to calculate the relative yield is the same as is used to calculate the Actual Production History (APH) yield, though up to 10 years can be used to calculate the APH yield.
"Relative yields can be compared to coverage levels to see if yield insurance would make payments," Schnitkey explained. "For a relative yield of 78 percent, yield insurance would pay if an 80 or 85 percent coverage level had been selected while payments would have occurred for coverage levels of 75 percent or below.
"The comparisons are valid only for yield insurances as price changes have to be considered when determining payments from revenue insurances."
From 1977 through 2005, the study indicates that relative yields average 104 percent across all farms, indicating that yields are increasing over time. However, there is a great deal of year-to-year variability. The year with the highest relative yield is 1992 with an average of 138 percent while the lowest year is 1988 with an average relative yield of 60 percent.
Schnitkey said that the study also shows that for the group of farms having the lowest yields, the situation is worse.
"Across all the years, the lowest 25 percent of farms in terms of yields range from 20 to 34 percentage points below the average of all yields," he noted.
Breaking the study down into three regions--northern, central, and southern--reveals more diversity.
"For northern Illinois, 2005 was the fourth lowest yielding year between 1976 and 2005," he said. "In 2005, relative yields averaged 65 percent for the lowest 25 percent of yields. Years with lower yields were 1988, 1983, and 1991."
Central Illinois, however, enjoyed relatively stable yields between 1995 and 2005. Low yielding years include 1988, 1983, 1980, 1991, and 1995. In 2005, 70 percent is the average of the 25 percent lowest yields.
"Yields in southern Illinois were close to average in 2005," he said. "The average relative yield in 2005 in the region is 101 percent while the lowest 25 percent average 78 percent. Southern Illinois had a drought in 2003, resulting in an average 47 percent relative yield for the 25 percent lowest yields. Other low yielding years included 1983, 1980, 1988, 1991, and 1995."
Overall, the study indicates that lower relative yields tend to be regional rather than state-wide in nature.
"Since 1988, years of lower yields have occurred, but they have tended to be regional in nature," said Schnitkey. "For example, many northern Illinois farms had low yields in 2005 while many southern Illinois farms had low yields in 2003. When viewed using averages, these low yielding years have been less severe than previous years."