crop budgets – Views from VanDeWalle

Two decision-making tools created by Nebraska Extension for agricultural producers across the state have been updated for the new year. The 2020 Nebraska crop budgets (https://cropwatch.unl.edu/budgets) and representative cow-calf budgets (https://go.unl.edu/cow-calfbudgets) are now available to provide producers with cost-of-production estimates. Both sets of budgets are available as PDFs and Excel files, which feature tools that allow users to enter information into worksheets to calculate estimated production costs.

black calculator near ballpoint pen on white printed paper — Photo by Pixabay on Pexels.com

Both the crop and livestock budget files are made available online so producers can download, then modify, production and expense figures to more closely match their various enterprises. Glennis McClure, a Nebraska Extension educator in the Department of Agricultural Economics takes the lead on completing the budgets and reminds producers that understanding enterprise cost of production in agriculture is important in product mix decision-making, pricing, marketing and financial analysis.

The crop budgets include 82 production budgets for 15 crops produced in Nebraska, along with cost data for power, machinery and labor. They were compiled by a team led by Robert Klein, an extension crops specialist, and McClure, utilizing a template created by Roger Wilson, a retired extension farm and ranch management analyst.

There are five cow-calf budgets that offer representative herd data for different regions of the state. Background stories are included to assist producers with information relevant to each budget, which may guide producers in determining their own costs. McClure led the cow-calf budget effort, which was compiled from information gathered from producer panels that have met as part of the university’s multidisciplinary Beef Systems Initiative.

In addition to the cash rental rates and custom rates released by Nebraska Extension and the UNL Agricultural Economics Department, the crop budgets are another helpful set of materials for producers to use. Agricultural Economists from the University of Nebraska–Lincoln have just released 2019 information which includes 78 budgets on 15 crops, predicting price expectations for input costs for 2019.

Information released from the Ag Economics department and UNL’s CropWatch recently shared a summary of the information. In comparing several corn and wheat budgets from 2018 to 2019, total costs for field operations, materials and services have increased. For example, with dryland, no-till, continuous corn with a 125-bushel yield, experts estimate materials and services will be $6.89 per acre higher in 2019.

Pivot-irrigated corn with a 245-bushel yield would see an anticipated $30.45-per-acre increase in materials and services. In addition to estimating a total cost of production per acre and per-bushel cost, including opportunity cost for land use, each budget shows the cash costs of production. The budgets do not estimate returns. The largest increase in costs for the 2019 budgets as compared to 2018 is for nitrogen fertilizer, with a price increase of about 20 percent. Phosphorus fertilizer has increased about 11 percent. Fuel costs were adjusted higher with land costs adjusted slightly lower, based on the Nebraska Farm Real Estate Report.

Material and service costs for the budgets were researched by a team led by Robert Klein, extension cropping systems specialist. Glennis McClure, extension educator in agricultural economics, and Roger Wilson, retired extension farm management analyst, worked together to format and publish the budgets. One thing to always remember is that the budgets are cost estimates based on assumptions and should only be used a guide and reviewed carefully before decision making by farmers.

To view the 2019 crop budgets, visit https://cropwatch.unl.edu or https://agecon.unl.edu/budgets.

Tag: crop budgets

2020 Crop & Cow-Calf Budgets

2019 Crop Budgets