By Jonathan LaPorte and Eric Anderson et.al
Farm profitability is a bottom-line priority for farmers. It is a challenge in any year, but particularly in times when input costs are on the rise. When margins are tight, farmers need to know their cost of production to determine what inputs and practices are profitable and which ones may need to be put on hold. The new MSU Extension 2027 Projected Cost of Production tools for corn, soybeans, and wheat are intended to serve as a starting point for discussions on both expected income and expenses for individual farms.
For each crop tool, there are three versions of projected cost of production in a single downloadable Excel file:
- The Base Projection version provides an estimate for farms seeking to minimize costs without sacrificing yield. Base projections have aligning chemical plans and assume fertility plans based on rate of nutrient removal from the Tri-State Fertilizer Recommendations bulletin.
- The Build-Up version starts out using the same information as the base projections. The fertility plans are updated to include recommended additional fertilizer inputs to build up soil nutrient levels based on example soil test results.
- The Push Production version provides an estimate for farms seeking to push maximum yield output. Push production projections have aligned chemical plans and assume fertility plans based on nutrient removal rates from the Tri-State Fertilizer Recommendations bulletin.
Income values are derived from price projections from composite grain buyers across Michigan and yield data for Michigan from USDA’s National Agricultural Statistics Service (NASS). Expenses are based on the latest Illinois production costs report from USDA’s Agricultural Marketing Service (AMS), composite prices from Michigan retailers, five-year average benchmark data from the FINBIN database (finbin.umn.edu), and current price trends.
Source : msu.edu