2014-01-18 options for small acreages-johnhobbs.pptextension.missouri.edu/webster/documents... ·...

Webster County Diversified Agriculture Conference -Marshfield, MO

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Options for Small Acreages

John Hobbs – Ag & Rural DevelopmentUniversity of Missouri Extension

Pineville, MO

My Small Farm

What can I do with it?

No easy answers. Landowners soon find decisions get complicated

with web of details. Like any other small business, a small farm

requires long hours, commitment, risk taking, entrepreneurial spirit.

Factors to consider: 1.Farm Goals 2.Farm Resources 3.Enterprise 4.Family Resources

The major components involved in a farm enterprise decision

Farm Goals Hobby or Lifestyle

Tax Deferment

Supplemented or

Family Income

Farm Resources Land – Soil Types and

capabilities

Water- Irrigation

Climate or microclimate

Enterprise • Production Technique -

conventional, organic, or sustainable

• Crops – conventional or specialty

• Marketing-wholesale or direct to consumers (farmers market, restaurants, csa’s)

• Livestock• Agri-tourism

Family Resources and Skills• Finances• Credit• Family Skills and Desires• Labor: Farming business and marketing

skills Risk-taking ability Lifestyle desires

Are Small Farms a Factor in Missouri ag industry today?

86% of farms in SW MO had sales lessthan $50,000

and 45% of those farms had sales of less than

$1,000

There are 1,444 farms in SW MO less than 50 acres

The average beef herd in MO is 30 head

A good foundation is key to any successful endeavor

There are six factors to consider when looking at a new ag enterprise

P stands for profitability

R stands for resources

I represents information

M represents marketing

E stands for enthusiasm, and

R stands for risk


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PRIMER Score Sheets

ProfitabilityCircle your most likely response

Cash cow…………………………………………………………………………… 10Probably profitable- just needs a little planning……………… 8Profitable if I can get some start-up funds………………………. 6Profitable, but easily duplicated and limited market……….. 4Can make a profit if all stars line up right………………………… 2Profits unlikely, but still looks like fun………………………………. 0

ResourcesCircle your most likely answer

Have everything I need…………………………………………………….. 10Need a few minor low-cost items……………………………………… 8Missing one important resource, but can acquire it at

some expense……………..………………………………………………….. 6No experience with enterprise, but can develop it in

time…………………………………………………………………………………… 4No experience and needing to acquire some major

resources…………………………………………………………………………. 2Starting from scratch………………….………………………………………. 0

PRIMER Score Sheets

InformationCircle your most likely response

Production & marketing info well in hand…………………………. 10Need to do a little homework…………………………………………….. 8Need to do a fair amount of homework…………………………….. 6No one has ever seen this done here before but

can find info elsewhere……………………………………………………. 4No access to computer, extension or library……………………… 2Starting from scratch…………………………………………………………... 0

PRIMER Score SheetsMarketingCircle your most likely response

MarketingPromising, accessible markets already exist –

people are begging for the product……………………………….. 10Accessible markets but will take a little effort

to develop ……………………………………………………………………… 8New retailing or cooperative marketing will have

to be developed, but still a good market……………………….. 6It may take some time and $ to help consumers

appreciate the value of this product/service…………………… 4The market is pretty well saturated with similar

products……………………………………………………………………………. 2Selling ice cubes to Eskimos……………………………………………….. 0

PRIMER Score Sheets

EnthusiasmCircle your most likely response

I can’t sleep at night, this idea is so exciting……………………. 10I’m excited about it but some in my family are

reluctant……………………………………………………..……………………. 8It’s as good an idea as any of the others I’ve

come up with…………………………………………………………………….. 6I could get excited but only if it works out fairly

soon………………………………………………………………..…………………. 4I’m out at the first sign of rough sailing………………………………. 2Why do I even have to do this?....................................... 0

PRIMER Score Sheets

RiskCircle your most likely response

I’m very comfortable with the return estimatesrelative to the risk involved…………………………………………… 10

I’m reasonably comfortable………………………………………………. 8Somewhat comfortable……………………………………………………… 6It looks OK, there’s just a lot still unknown……………………… 4I think I could make it, but there are possibilities

for significant loss…………………………………………………………... 2I’m better off buying a lotto ticket…………………………………….. 0

PRIMER Score Sheets


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Score Sheet Summary

Very promising, move ahead…………………………………….48-60

Has promise but will need some work………………………38-47

Has promise and some serious hurdles.Carefully evaluate whether this is a good fit…………….28-37

What others are doing

Backyard Poultry

Backyard Layer Flock Budget (4 hens, 3 years of Income/Yield Three years

1.Dozens of eggs produced 209 Doz.

Price per dozen $3

3.Gross Income per AFlock $627

Variable Cost per 4 Hens

1.Housing 250

2.Heat lamp,feeders, waterers 50

FEED

3.Chick Starter 2 bags 32

Chicks 40

4. Layer Feed 19 bags 266

6.Total Variable Costs $638

Total Cost per Dozen Eggs $3.05

Labor .25 hours per day X 1095 days = 274 hours

Over three years, 200 days are needed for raising chicks and molting.

Production is calculated as 895 days x 4 hens x 70% egg yield per day.


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Cut Flowers

$2000-4000 gross returns per acre

U-Pick


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Strawberry BudgetIncome/Yield Establishment

1. Yield # Pounds per Acre 6000

2. Price per pound 1.5

3.Gross Income per Acre 9000

Variable Costs per Acre

1.Plants 5445 x .50 2722

2.Fertilizer, Lime, etc. 200

Irrigation/Plastics/Fuel 600

3.Pesticides 100

4.Labor $10 per hour 1000

5.Harvesting Supplies 1000

6.Total Variable Costs 5622

Fixed Cost per Acre

1.Interest on captial investment,equipmen 250

2. Taxes 30

3.Total Fixed Costs 280

Total Costs per Acre 5902

Net Returns $3,098

$3000 to 5000 gross per acre

Blackberry BBudgetIncome/Yield Establishment

1. Yield # Pounds per Acre 6000

2. Price per pound 1.5



1.Plants 1452 x $4.50 6534

2.Fertilizer, Lime, etc. 200

3.Pesticides 100


5.Harvesting Supplies 200


Fixed Cost per Acre


2. Taxes 30



Net Returns $686

Bees


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Honey BudgetIncome/Yield Establishment

1.Yield for Ten Established Colonies 700

2. Price per pound 3



1.Replacement Bees/Queens 250

2.Parasite & Disease Control 200

Sugar/Jars/Labels/Buckets 460

3. Vehicle 83


5.Marketing/advertising 150


Fixed Cost per Acre


2. Taxes 30



Net Returns $477

Roadside StandsFarmers Markets

Corn Maize


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Pumpkin Patch

Corn Maze for 5 acresIncome

Admission Fees @$7/person $35,000

Parking

Corn Harvest 500 bushels $2,250

Total Income $37,250

Maze Costs

Corn Production @ $450/Acre $2,250

Maze Design and Cutting

Design costs and cutting $1,500

Path Maintenance Labor $10 x 30 Hours $300

Fuel $120

Marketing $9,000

Wristbands $200

Restrooms $800

Liability Insurance $1,500.00

Hired Labor 900 hours @ $8.00 $7,200.00

Total Expenses $21,370

Net Income $15,880

Fee Hunting and Fishing Petting Zoo’s


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Goat Production

SAMPLE MEAT GOAT BUDGET by Susan Schoenian

Annual kidding You can only edit values highlighted in yellow.

HERD COMPOSITION: PRODUCTION PARAMETERS

Number of Does 30 Percent kid crop raised 150%

Number of Bucks 1 Doe replacement rate 20%

Adult death loss 5.0% Buck Replacement Rate 33%

INCOME CALCULATION: No. Head lbs./hd Net Price Unit Total Per doe

Market kids 39.0 70 $2.00 lb. $5,460 $182.00

Cull does 4.5 90 $0.75 lb. $304 $10.13

Cull bucks 0.33 170 $0.75 lb. $42 $1.40

Other income $0 $0.00

TOTAL INCOME $5,806 $193.53

OPERATING COSTS: No. Head Amt/hd Unit Cost Total Per doe

Feed costs

Hay 31 0.25 ton $90.00 $698 $23.25

Grain 31 135 Lb. $0.12 $502 $16.74

Salt and Minerals 31 12.0 Lb. $0.16 $60 $1.98

Supplemental feed for kids 45 0.0 Lb. $0.15 $0 $0.00

Pasture maintenance total acres 6.0 acre $30.00 $180 $6.00

Health program doses

Deworming (adults) 31 3 doses $1.00 $93 $3.10

Deworming (kids) 45 3 doses $0.75 $101 $3.38

CD-T booster (adults) 31 1 doses $0.50 $16 $0.52

CD-T vaccinations (kids) 31 2 doses $0.50 $31 $1.03

Other vet costs 31 head $4.00 $124 $4.13

Buck replacement 0.33 head $250.00 $83 $2.75

Bedding 31 head $3.00 $93 $3.10

Marketing and Hauling 44 head $5.00 $219 $7.31

Supplies 31 head $3.00 $93 $3.10

Additional Cost Total cost $.00 $0 $0.00

Additional Cost Total cost $0.00 $0 $0.00

Interest on operating money 5.0% Cost for 6 months $57 $1.91

TOTAL OPERATING COSTS $2,349 $78.30

Returns $115.30

Example is for herd of 100 does & 3 bucks with 170% kid crop raised; 20 doe kids retained as replacements. Purchase bucks at $300 each.

Per Doe

ESTIMATED INCOME PER DOE

Kid sales

No. kids 1.5

Cwt./kid 0.7

Price/cwt. $140.00 $147.00

Cull doe sales

No. does 0.16

Cwt./doe 1

Price/cwt. $55.00 $8.80

ESTIMATED TOTAL INCOME (gross receipts/doe) $155.80

ESTIMATED OPERATING COSTS PER DOE

Pasture (example is rental rate of $30/ac.) $9.00

Hay Tons/doe 0.25 Price/ton $90.00 $22.50

Grain Lbs./doe 50 Price/lb. $0.12 $6.15

Salt & minerals Lbs./doe 43 Price/lb. $0.27 $11.61

Dewormer (6 times/year) 5 Vaccinations 0.5 Marketing & hauling 10 Utilities & machinery costs 6 Livestock facility & fence repair 3 Professional fees (legal, accounting, etc.) 0.3 Miscellaneous 2

Operating interest

Rate/year 6.00%

Portion of year op. costs borrowed 0.5 $2.29

Total Operating Costs Except Labor $78.60

Estimated labor cost Hours 2

Rate/hour $13.00 $26.00

Total Operating Costs Including Labor $104.60

ESTIMATED OWNERSHIP (FIXED) COSTS PER DOE

Depreciation & interest on livestock facilities & taxes $8.00

Breeding stock purchases 10.5

Total Ownership Costs $20.50

ESTIMATED TOTAL COSTS PER DOE $125.10

Income over Operating Costs $51.20

Income over Total Costs $30.70

Value Added Products


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Tree and Nut Production


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High Tunnel Size (sq. ft.) (30x72) 2,160 ft.Utilization 84%Approximate Original High Tunnel Cost $7,000.00

Receipts Yield (lb.) Sq. Ft. $/Lb. TotalCucumbers 567.0 454.0 $2.00 $1,134.00 1.25 $2.50Eggplant 204.1 45.0 $2.00 $408.24 4.54 $9.07Greens 166.9 363.0 $7.00 $1,168.47 0.46 $3.22Herbs 14.5 9.0 $16.00 $232.24 1.61 $25.80Lettuce 208.7 181.0 $7.00 $1,460.59 1.15 $8.07Peppers - Bell 290.3 181.0 $2.00 $580.61 1.60 $3.21Tomatoes - Slicers 1315.4 454.0 $2.50 $3,288.60 2.90 $7.24Tomatoes - Grape 342.9 127.0 $4.00 $1,371.69 2.70 $10.80

Total Receipts 1814.0 $9,644.44 $5.32

Annual Expenses Total Seeds/Transplants $135.00 Fertilizers $108.00 Miscellaneous Supplies $125.00 Water $86.40 Water Test $17.00 Irrigation Supplies $122.00

Total Annual Expenses $593.40

March - SeptemberLabor Costs Hours $/Unit Total

Bed Preparation 17.00 $12.00 $204.00 General Maintenance 23.00 $12.00 $276.00 Planting 10.50 $12.00 $126.00 Pest Management 0.00 $12.00 $0.00 Harvest 48.80 $12.00 $585.60

Total Annual Expenses 99.30 $1,191.60

Ownership Costs Annual Depreciation - Tunnel $875.00Depreciation - Plastic Cover $113.40

Total Ownership $988.40

Total Costs Tunnel $2,773.40 Per Square Foot $1.28

Annual Returns Over Total Costs Tunnel $6,871.04 Per Square Foot $3.18

Gross Per Sq. Ft.

Yield Per Sq. Ft.

Missouri Alternatives Centerhttp://agebb.missouri.edu/mac/index.htm

Small-farm operators develop economic vitality by:• Having a passion for what they do

• Watching their cash-flow cycle

• Producing crops for small but well paying markets

• Marketing aggressively and creatively

• Understanding there is a learning curve to new enterprises

• Invest in good soils and water

• Locate near a major population on paved road

• Match work to the family’s time, desires, and abilities

• Diversifying sources of earnings, including off-farm income, to produce a solid, year-round cash flow

2014-01-18 options for small acreages-johnhobbs.pptextension.missouri.edu/webster/documents... ·...

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