These decisions are complex because a decrease in one type of expense may be offset by an increase in other costs, or a change in expected yield. Langemeier (2017) and Plastina and Johanns (2017) indicate that the custom rate for using a self-propelled sprayer is approximately $6.70 to $7.65 per acre. Recently released crop budgets (farmdoc daily, August 4, 2020) project losses for corn and soybeans on Illinois farms, given current assumptions for 2021. 2H8so:e`!g[ a
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Fertilizer costs in 2022 are projected at $230 per acre for corn, considerably higher than the $153 per acre costs for 2021. Consider outsourcing certain field tillage passes. The farmdoc daily website falls under University of Illinois copyright and intellectual property rights. Machinery costs would have been higher had not interest rates been reduced from 2019 to 2021. Represents the rate obtained from surveys of actual farm data surveys for 2014 & 2015 from Universities listed below to do this type of . 7 ag stories you cant miss March 3, 2023, Jill Reiter, Virginia State FFA Vice President, Soymeal rally sends soybeans higher on the week. This Microsoft Excel spreadsheet will estimate Price Loss Coverage (PLC) and Agricultural Risk Coverage at the county level ARC-IC (Agriculture Risk Coverage Individual) has received less attention than ARC-CO (ARC County) and PLC (Price Loss Coverage). Follow thesesocial media channels for all thelatest ag commentary from Keith Good the Farm Policy News editor. Still, we are projecting positive returns for 2022, given relatively high corn and soybean prices. "Planting and Acreage Decisions in 2022." Click here (http://www.farmdoc.uiuc.edu/manage/newsletters/fefo06_16/fefo06_16.html) for a look at their summary, including commentary by farm management experts Dale Lattz and Gary Schnitkey. Based on the above comparisons, the following suggestions result: Further note that that these decisions are longer run in nature as well. If this level of detail is not available, it is common to use annual hours of use and machine age to estimate repair and maintenance costs. The $25 projected increase considers these variations and gives an average. These rates, except where noted, include the implement and tractor if required, all variable machinery costs such as fuel, oil, lube, twine .
Farm Progress is part of the Informa Markets Division of Informa PLC. For seven of the nine tillage operations compared, the economic cost of owning the machinery and performing the task is less than the average custom rate cost per acre, with all but one considerably lower than the average custom rate cost. Farm Progress Show annually hosts more than 600 exhibitors displaying new farm equipment, tractors, combines and farm implements; seed and crop protection products; and many additional farm supplies and services. The farmdoc daily website falls under University of Illinois copyright and intellectual property rights. Tables 1 and 2 present machinery costs for a field cultivation operation on the case farm. 2474 0 obj
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Acres farmed, annual hours, useful life, and interest rate represent those of the case farm. farmdoc daily (10):147, Department of Agricultural and Consumer Economics, University of Illinois at Urbana-Champaign, August 11, 2020. Although the actual costs will vary from farm to farm, and are dependent on the number of acres and the size or capacity of the equipment used, the averages presented here can be used as a guide. University of Illinois Extension provides equal opportunities in . County yields and market year average (MYA) prices are brought in for a user-specified state-county-crop combination. The total costs per hour for the tractor and implement were estimated to be $203.06 and $75.61 for a total combined cost per hour of $278.67. The computations of interest, insurance and housing, and repair costs assumed that the self-propelled sprayer had one-half of its useful life left. ", Revenue and Costs for Illinois Grain Crop, Revenue and Costs for Illinois Grain Crops, Revenue and Costs for Illinois Grain Crops, Actual for 2015 through 2020, Projected for 2021 and 2022, Management Decisions Relative to High Nitrogen Fertilizer Prices, Net Change in CRP Acres, 2020-2021 Program Year, Department of Agricultural and Consumer Economics, Department of Agricultural, Environmental and Development Economics, Overall increases in production and land costs, and. From time to time, Prairie Farmer gets requests for the custom rate estimates on various field operations. The cost with the largest increase is fertilizer. Interest should be included in ownership costs regardless of whether debt is incurred when purchasing a machine. Historically, cost of production has been a focus, In policy, definitions matter. Machinery cost estimates for 2019 are available in the management section of farmdoc in five publications. Machinery Cost Estimates: Field Operations. Illinois Farm Management Handbook, Department of Agricultural and Consumer Economics, University of Illinois at Urbana-Champaign, updated October 11, 2021. Total costs will be at all-time highs in 2022. November 2021 (11) October 2021 (10) September 2021 (12) August 2021 (14) July 2021 (12) . Number 8860726. Farmer returns for 2022 are projected at $61 per acre for corn and $67 per acre for soybeans, down considerably from 2021 levels. The 2021 estimates appear in the 2021 tractor costs publications, while the 2017 and 2019 costs appear in the machinery costs 2017 and 2019 editions. Respondents were recipients of a mailing by the Oklahoma Field Office, USDA-NASS. Note that the higher cost, heavier tillage operations are the ones where economic costs are above the corresponding custom rates. Iowa State University Extension and Outreach, Ag Decision Maker, A3-29, May 2015. Illinois crop budgets for 2022 have been revised from their initial release in July (farmdoc daily, July 27, 2021). A double-crop soybeans budget also is given for all regions except northern Illinois. Harvest. Fuel. That cost is higher than the maximum custom rate reported. The diesel fuel price was increased from $2.50 per gallon in 2019 to $2.75 per gallon in 2021. This publication shows estimated costs for owning and operating forage machinery. Operating costs include repairs and maintenance, fuel, lubrication, and labor. Many farms may have tillage implements that have been on the farm for generations, are fully paid for and fully depreciated. Users then can change 2018 through 2020 county yields and prices to see ARC-CO and PLC payments under those yields and prices. The most likely candidates for outsourcing are tillage operations that are not performed on all acres, and require specialized, costly tillage equipment. The total of all economic costs per acre for growing corn and soybeans in Illinois. We are grateful to the 97 survey respondents who provided information for this publication. Registered in England and Wales. http://www.farmdoc.uiuc.edu/manage/newsletters/fefo06_16/fefo06_16.html, http://www.farmdoc.uiuc.edu/manage/machinery/machinery_summary.html. September 14, 2021 at 6:50 illinois custom rate guide Verified 8 days ago Url: wxms.nodedecrease.shop Go Now Get more: Illinois custom rate guide Show All Rentals Unlike fuel and labor costs which vary with use, depreciation and interest costs vary little with use. Consider reducing tillage operations. 147 0 obj
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The information in table 1 was used to help compute the total machinery costs for field cultivation on the case farm in table 2. This article outlined the conceptual framework needed to estimate machinery costs per acre. Estimating Farm Machinery Costs, available by searching Iowa State University agriculture decision maker and machinery management. Guidelines are available here. Machinery Cost Estimates: Forage Field Operations. Illinois Farm Management Handbook, Department of Agricultural and Consumer Economics, University of Illinois at Urbana-Champaign, updated October 11, 2021. Corn is projected $15 per acre higher than soybeans in northern Illinois, corn is projected $14 per acre higher than soybean on low productivity farmland in central Illinois, and soybeans are projected to be $1 more profitable than corn in southern Illinois. This provides summary cost of production budgets for corn and soybeans. Fuel costs will vary with each operations fuel use. A $19 per hour rate was used in 2019 compared to a $20 per hour rate in 2021. For a detailed statement, please see the University of Illinois Copyright Information and Policies here. These estimates are useful for determining custom rates and for analyzing machinery costs on farms. Based on data collected through the Purdue University Center for Commercial Agriculture 2021 Custom Rates Survey, the person baling the hay on shares today gets 52% of the crop, on average. Labor. Historically, cost of production, Introduction High farm input costs, especially for fertilizer and fuel, have reinvigorated arguments for farm support programs where payments are triggered when the cost of production rises. Depreciation results from wear, obsolescence, and machine age. Air-seeder at $16.80 per acre. For farms in that situation, the cost of retaining that equipment to use as needed is comparatively lower than the economic cost of a newer implement because depreciation and interest make up a large portion of the economic costs. Subscribe to receive top agriculture news, Be informed daily with these free e-newsletters. Two methods for managing tillage costs are to 1) reduce tillage passes and 2) outsource tillage operations. Labor time is assumed to be 1.1 times the tractor hour resulting in a 10% higher cost per tractor hour. A 21-foot chisel plow used on 882 acres has a cost of $16.00 per acre, while a 27-foot chisel plow used on 1,134 acres has nearly the same cost at $15.90 per acre. Twenty percent of the respondents perform custom work, 16% Although tillage can provide value, there is a cost associated with each tillage operation. farmdoc daily (11):160, Department of Agricultural and Consumer Economics, University of Illinois at Urbana-Champaign, November 30, 2021. "Machinery Cost Estimates: Tractors." Due to the fuel price increases, fuel costs for the 310 horsepower tractor increased from $37.30 per hour in 2019 to $41.10 per hour in 2021 (see Table 1). These decisions may also be dependent on requirements of a landlord or business owner for certain practices to be done and concern over the ability to outsource in a timely manner when the task needs completed. About the report. Report with summary of cost to produce milk in Illinois. hbbd```b``+@$S7di'EHi` ,""A$& Q`D]k@${ d[Vq 7 ag stories you cant miss March 3, 2023, Jill Reiter, Virginia State FFA Vice President, Soymeal rally sends soybeans higher on the week. Iowa State University custom farming surveys are useful for outsourcing decisions. This Current Report summarizes data collected from Oklahoma farmers, ranchers and custom operators during the fall of 2021. For several common tillage operations, the average farmdoc machinery use rate is shown in Table 1 next to the corresponding average, median, minimum and maximum custom rates from the Iowa survey responses. From time to time, Prairie Farmer gets requests for the custom rate estimates on various field operations. Each year, eHay Weekly offers readers a one-stop shop for accessing custom field work rate information from those states that have done . Similarly, soybean non-land costs are projected at $476 per acre, a $101 per acre increase over the 2021 level. In addition to the costs outlined in table 3, the costs in table 4 include fuel, lubrication, and labor costs. Per hour costs are divided into overhead, fuel, and labor categories. Edwards, William. These . Improvement in outlook could come from higher prices, above trend yields without lower prices, additional government aid, cuts in costs, or some combination of those. Some cash rents will not increase, while others will have much larger increases than $25 per acre. Tillage. For most farms, the best cost management practice would be to own tillage implements that provide the greatest economic value for the farm, including which operations are expected to be used most frequently on the greatest number of acres. "2022 Crop Budgets Contain Higher Costs." Shows estimated costs for different sized tractors. Shawn and Kristy Freeland with some of their cattle, Corn with fuel pump handle representing ethanol fuel. Or in your area, the person who owned the hay may still have expected half the hay plus up to $1 per bale for your half. The total cost per hour for the self-propelled sprayer is estimated to be $314.57. Schnitkey, G. Crop Budgets, Illinois, 2022. Illinois Farm Management Handbook. Here, we are talking about economic depreciation rather than tax depreciation. For example, a generational family farm may have different levels of ownership, own separate pieces of machinery, or have acreage shares that dont align with ownership, and these costs can be used as a resource for settling with other farm members. Summary of index numbers for Illinois farmland values. We provide machinery cost estimates which may be helpful in setting custom rates. ", Tillage, Nitrogen Use, and Cover Crop Impacts of Corn and Soybean Returns, Revenue Loss Coverage and Other Farm Safety Net Proposals in an Era of High Ad Hoc Payments, Department of Agricultural and Consumer Economics, Department of Agricultural, Environmental and Development Economics.