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2020 Cost of Production

Crops

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Date: January, 2020

This tool is available as an Excel worksheet at: or at your local is also available to helpdetermine machinery costs.

The is also available for producers to

Crop Production Costs - 2020Guidelines For Estimating

The following budgets are estimates of the cost of producing the most commonly grown field crops in Manitoba. General Manitoba Agriculture and Resource Development recommendations are assumed in using fertilizers and chemical inputs. These figures provide an economic evaluation of the crops and estimated yields required to cover all costs. Costs include labour, investment and depreciation, but do not include management costs, nor do they necessarily represent the average cost of production in Manitoba.

These budgets may be adjusted by putting in your own figures. As a producer you are encouraged to calculate your own costs of production for various crops. On each farm, costs and yields differ due to soil type, climate and agronomic practices.

Note: This budget is only a guide and is not intended as an in depth study of the cost of production of this industry. Interpretation and use of this information is the responsibility of the user. If you need help with a budget, contact your local Manitoba Agriculture and Resource Development office.

estimate the cash cost of producing field crops on their farm on an annual basis. CropPlan calculates marginal returns, breakeven yields, breakeven crop prices on total production and remaining unsold inventory, land and machinery cost analysis and cash based financial ratios.

The Farm Machinery Custom and Rental Rate Guide

www.manitoba.ca/agriculture

CropPlan Production Cost Calculator

Manitoba Agriculture and Resource Development office.

Guidelines: Crop Production Costs 2

Canola

Wheat - Hard Red

Spring Soybeans Oats Corn Barley

Wheat - Northern Hard Red

Wheat - Winter

A. Operating Costs

Seed & Treatment $62.50 $24.00 $95.10 $18.13 $86.25 $15.00 $22.00 $20.00

Fertilizer $80.73 $63.79 $17.29 $45.52 $99.42 $50.17 $73.09 $68.44

Herbicide $14.41 $30.50 $10.00 $9.38 $26.25 $35.00 $30.50 $14.25

Fungicide $16.25 $16.50 $0.00 $10.25 $0.00 $8.89 $16.50 $16.50

Insecticide $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00

Fuel $21.09 $22.78 $19.47 $26.53 $28.29 $24.22 $23.80 $23.24

Machinery Operating $10.00 $10.00 $10.00 $10.00 $10.00 $10.00 $10.00 $10.00

Machinery Lease $2.88 $2.88 $2.88 $2.88 $2.88 $2.88 $2.88 $2.88

Rental and Custom $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00

Crop Insurance $7.89 $7.77 $11.53 $9.31 $21.93 $9.75 $11.61 $7.32

Hail Insurance $7.56 $6.30 $8.19 $6.30 $6.30 $6.30 $6.30 $6.30

Other Costs $7.75 $7.75 $7.75 $7.75 $7.75 $7.75 $7.75 $7.75

Land Taxes $15.00 $15.00 $15.00 $15.00 $15.00 $15.00 $15.00 $15.00

Drying Costs $0.00 $0.00 $0.00 $0.00 $35.00 $0.00 $0.00 $0.00

Interest on Operating $6.77 $5.70 $5.42 $4.43 $9.32 $5.09 $6.03 $5.27

Total Operating $252.83 $212.97 $202.62 $165.48 $348.39 $190.04 $225.46 $196.96

B. Fixed Costs

Land Costs $67.06 $67.06 $67.06 $67.06 $67.06 $67.06 $67.06 $67.06

Machinery Costs $67.31 $67.31 $67.31 $67.31 $75.38 $67.31 $67.31 $67.31

Storage Costs $4.77 $6.70 $4.20 $11.93 $15.33 $9.09 $7.95 $7.27

Total Fixed $139.13 $141.06 $138.57 $146.29 $157.77 $143.45 $142.31 $141.63

Total Operating & Fixed $391.96 $354.04 $341.19 $311.77 $506.16 $333.49 $367.77 $338.59

C. Labour $26.40 $26.40 $26.40 $26.40 $26.40 $26.40 $26.40 $26.40

Total Costs $418.36 $380.44 $367.59 $338.17 $532.56 $359.89 $394.17 $364.99

Estimated Farmgate

Target Price $ per unit $10.50 $6.75 $10.50 $3.75 $4.50 $4.00 $6.00 $5.25

Premium $ per unit $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00

Target Yield per acre 42 59 37 105 135 80 70 64

Unit type (bu. or lb.) bu bu bu bu bu bu bu bu

Gross Revenue / acre $441.00 $398.25 $388.50 $393.75 $607.50 $320.00 $420.00 $336.00

Revenue Ranking 6 8 10 9 1 14 7 13

Operating Expense Ratio 57.3% 53.5% 52.2% 42.0% 57.3% 59.4% 53.7% 58.6%

Marginal ReturnsOver Operating Costs $188.17 $185.28 $185.88 $228.27 $259.11 $129.96 $194.54 $139.04Over Operating & Fixed $49.04 $44.21 $47.31 $81.98 $101.34 ($13.49) $52.23 ($2.59)Over Total Costs (Net Profit) $22.64 $17.81 $20.91 $55.58 $74.94 ($39.89) $25.83 ($28.99)

Profitability Ranking 7 9 8 3 2 16 6 14

Return on Investment (ROI) 5.41% 4.68% 5.69% 16.44% 14.07% (11.08%) 6.55% (7.94%)

Return on Asset (ROA) 3.84% 3.76% 3.78% 4.97% 5.75% 2.21% 4.02% 2.46%

Breakeven Price Per Unit

Over Operating Costs $6.02 $3.61 $5.48 $1.58 $2.58 $2.38 $3.22 $3.08

Over Operating & Fixed Costs $9.33 $6.00 $9.22 $2.97 $3.75 $4.17 $5.25 $5.29

Over Total Costs $9.96 $6.45 $9.93 $3.22 $3.94 $4.50 $5.63 $5.70

Breakeven Yield (Bu or lb.)

Over Operating Costs 24.1 31.6 19.3 44.1 77.4 47.5 37.6 38

Over Operating & Fixed Costs 37.3 52.4 32.5 83.1 112.5 83.4 61.3 64.5

Over Total Costs 39.8 56.4 35.0 90.2 118.3 90.0 65.7 70

Breakeven Yield Risk Ratio 106% 105% 106% 116% 114% 89% 107% 91%(Target Yield per Acre / BE Yield)

Note: This budget is only a guide and is not intended as an in depth study of the cost of production of this industry. Interpretation and utilization of this information is the responsibility of the user.

Crop Production Costs 2020 Guidelines (Dollars Per Acre)

Profitability Analysis

Breakeven Analysis

Manitoba Agriculture and Resource Development


Peas Fall Rye FlaxseedBeans -

Pinto

Wheat - Prairie Spring

Sunflower Oil

Sunflower Confection

Beans - White

Wheat - Special Purpose Your Farm

$35.06 $10.50 $22.80 $70.00 $22.00 $38.00 $48.31 $81.25 $22.00

$12.97 $50.17 $47.84 $45.52 $68.44 $70.13 $70.13 $50.17 $68.44

$14.75 $7.50 $20.63 $67.66 $30.50 $28.59 $46.19 $67.66 $30.50

$19.50 $0.00 $14.50 $28.57 $16.50 $0.00 $20.50 $32.73 $16.50

$0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $5.63 $0.00 $0.00

$17.89 $19.24 $19.83 $17.17 $23.80 $22.45 $21.98 $17.01 $23.62

$10.00 $10.00 $10.00 $10.00 $10.00 $10.00 $10.00 $10.00 $10.00

$2.88 $2.88 $2.88 $2.88 $2.88 $2.88 $2.88 $2.88 $2.88

$0.00 $0.00 $0.00 $0.00 $0.00 $8.50 $17.00 $0.00 $0.00

$9.82 $9.66 $9.73 $24.97 $8.13 $14.55 $28.26 $21.36 $10.20

$12.60 $6.30 $6.30 $11.03 $6.30 $6.30 $6.30 $11.03 $6.30

$7.75 $7.75 $7.75 $7.75 $7.75 $7.75 $7.75 $7.75 $7.75

$15.00 $15.00 $15.00 $15.00 $15.00 $15.00 $15.00 $15.00 $15.00

$0.00 $0.00 $0.00 $0.00 $0.00 $10.00 $10.00 $0.00 $0.00

$4.35 $3.82 $4.87 $8.26 $5.81 $6.44 $8.52 $8.71 $5.86

$162.56 $142.82 $182.13 $308.80 $217.11 $240.58 $318.45 $325.55 $219.04

$67.06 $67.06 $67.06 $67.06 $67.06 $67.06 $67.06 $67.06 $67.06

$67.31 $67.31 $67.31 $72.69 $67.31 $75.38 $75.38 $72.69 $67.31

$4.88 $6.59 $2.84 $3.60 $7.95 $8.18 $7.61 $3.41 $7.72

$139.25 $140.95 $137.20 $143.34 $142.31 $150.62 $150.05 $143.16 $142.09

$301.81 $283.77 $319.33 $452.14 $359.42 $391.20 $468.50 $468.70 $361.13

$26.40 $26.40 $26.40 $26.40 $26.40 $26.40 $26.40 $26.40 $26.40

$328.21 $310.17 $345.73 $478.54 $385.82 $417.60 $494.90 $495.10 $387.53

$7.00 $5.50 $12.00 $0.30 $5.50 $0.25 $0.30 $0.30 $5.25

$0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00

43 58 25 1,900 70 1,800 1,675 1,800 68

bu bu bu lb bu lb lb lb bu

$301.00 $319.00 $300.00 $570.00 $385.00 $450.00 $502.50 $540.00 $357.00

16 15 17 2 11 5 4 3 12

54.0% 44.8% 60.7% 54.2% 56.4% 53.5% 63.4% 60.3% 61.4%

$138.44 $176.18 $117.87 $261.20 $167.89 $209.42 $184.05 $214.45 $137.96($0.81) $35.23 ($19.33) $117.86 $25.58 $58.80 $34.00 $71.30 ($4.13)

($27.21) $8.83 ($45.73) $91.46 ($0.82) $32.40 $7.60 $44.90 ($30.53)

13 10 17 1 12 5 11 4 15

(8.29%) 2.85% (13.23%) 19.11% (0.21%) 7.76% 1.54% 9.07% (7.88%)

2.44% 3.51% 1.87% 5.84% 3.27% 4.35% 3.64% 4.52% 2.43%

$3.78 $2.46 $7.29 $0.16 $3.10 $0.13 $0.19 $0.18 $3.22

$7.02 $4.89 $12.77 $0.24 $5.13 $0.22 $0.28 $0.26 $5.31

$7.63 $5.35 $13.83 $0.25 $5.51 $0.23 $0.30 $0.28 $5.70

23.2 26 15 1029.3 39.5 962 1061 1085.2 42

43.1 51.6 26.6 1507.1 65.3 1564.8 1561.7 1562.3 68.8

46.9 56 29 1595.1 70.1 1670 1650 1650.3 74

92% 104% 86% 119% 100% 108% 102% 109% 92%


Crop Production Costs 2020 Guidelines (Dollars Per Acre)

Profitability Analysis

Breakeven Analysis



Canola

Wheat - Hard Red



Wheat - Winter

AgriInsurance

80% Insured Value $356.10 $293.75 $280.44 $286.12 $369.88 $239.95 $314.38 $299.53

Premium Cost (% of Insured) 2.2% 2.6% 4.1% 3.3% 5.9% 4.1% 3.7% 2.4%

Costs Not Covered By AgriInsurance

Operating Costs $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00

Operating & Fixed Costs $35.86 $60.29 $60.74 $25.65 $136.28 $93.54 $53.39 $39.06

Total Costs $62.26 $86.69 $87.14 $52.05 $162.68 $119.94 $79.79 $65.46

AgriInsurance Risk Ratio (AgriInsurance Coverage / Cost)

Operating Costs 141% 138% 138% 173% 106% 126% 139% 152%

Total Costs 85% 77% 76% 85% 69% 67% 80% 82%

Risk Ranking 13 10 11 17 1 4 12 14

(Lower number indicates increasing risk)

Percent Market Price Change -10.0%

Percent Crop Yield Change -5%

Canola

Wheat - Hard Red



Wheat - Winter

Market Price ($ per unit) $9.45 $6.08 $9.45 $3.38 $4.05 $3.60 $5.40 $4.73

Yield (per acre) 40 56 35 100 128 76 67 61

Stress Test Scenario = Market Price Down 10%, and Crop Yield Down 5%Net Profit (Loss) ($40.36) ($40.24) ($36.84) ($0.67) ($14.16) ($86.29) ($32.37) ($76.76)

Profitability Ranking 10 9 7 2 3 16 4 14

Operating Expense Ratio 66.9% 62.6% 61.3% 49.0% 67.2% 69.5% 62.3% 68.3%

Data Source – MASC Harvest Production Reports (2010-2015)

Year 1 Year 2 Year 3 Year 4 Year 5 Year 6

Wheat - Hard Red

Spring Canola

Wheat - Hard Red

Spring Canola

Wheat - Hard Red

Spring Canola

Rotation Total

Marginal Return

Rotation Yield Premium 100% 102% 101% 102% 101% 102% -

Net Profit (Loss) $17.81 $31.46 $21.80 $31.46 $21.80 $31.46 $156

Corn Canola

Wheat - Hard Red

Spring Soybeans Corn Canola

Rotation Total

Marginal Return


Net Profit (Loss) $74.94 $75.56 $21.80 $24.80 $93.16 $75.56 $366


Example Rotation #1

Example Rotation #2

Rotation Economic Analysis

AgriInsurance Analysis

Risk & Sensitivity Analysis (Stress Test)




Pinto


Sunflower Oil


Beans - White


$207.83 $241.61 $239.41 $482.13 $270.41 $322.92 $407.16 $438.37 $262.00

4.7% 4.0% 4.1% 5.2% 3.0% 4.5% 6.9% 4.9% 3.9%

$0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00

$93.97 $42.16 $79.92 $0.00 $89.02 $68.28 $61.34 $30.33 $99.13

$120.37 $68.56 $106.32 $0.00 $115.42 $94.68 $87.74 $56.73 $125.53

128% 169% 131% 156% 125% 134% 128% 135% 120%

63% 78% 69% 101% 70% 77% 82% 89% 68%

5 16 7 15 3 8 6 9 2


Pinto


Sunflower Oil


Beans - White


$6.30 $4.95 $10.80 $0.27 $4.95 $0.23 $0.27 $0.27 $4.73

41 55 24 1805 67 1710 1591 1710 65

($69.91) ($37.92) ($86.53) $8.81 ($54.17) ($32.85) ($65.33) ($33.40) ($80.40)

13 8 17 1 11 5 12 6 15

62.9% 52.5% 70.3% 63.4% 65.5% 62.5% 74.1% 70.5% 71.3%

Year 1 Year 2 Year 3 Year 4 Year 5 Year 6

Example Rotation #3Wheat -

Hard Red Spring Canola Oats Soybeans Corn


Rotation Total Marginal Return


Net Profit (Loss) $17.81 $31.46 $59.52 $20.91 $93.16 $103.08 $326

Your Farm Rotation

Soybeans

Wheat - Hard Red

Spring Canola Soybeans

Wheat - Hard Red

Spring CanolaRotation Total

Marginal Return


Net Profit (Loss) $20.91 $49.67 $31.46 $20.91 $49.67 $31.46 $204


AgriInsurance Analysis

Risk & Sensitivity Analysis (Stress Test)

Rotation Economic Analysis



Canola, 3,214,817

Wheat - Hard Red Spring, 2,758,181

Soybeans, 1,388,899

Oats, 535,231

Corn, 416,259

Barley, 348,977

Wheat -Northern Hard Red, 153,585Other, 514,479

MASC - 2019 Seeded Acres

Manitoba Agriculture & Resource Development

Wheat - Winter, 33,302

Peas, 112,175

Fall Rye, 40,312

Flaxseed, 45,705

Hybrid Fall Rye, 53,793

Beans - Pinto, 55,924 Wheat - Prairie

Spring, 33,302

Sunflower Oil, 45,831

Sunflower Confection,

20,032

Beans - White, 43,665

Black Bean, 27,308

Wheat - Special Purpose, 5,402

Hempseed, 10,009

Kidney Bean, 12,358

Fababean, 8,052Buckwheat, 6,766

Canaryseed, 3,179

Lentil, 1,542

MASC - 2019 Other Crop Seeded Acres

Manitoba Agriculture& Resource Development

141% 138% 138%

173%

106%

126%139%

152%

85%77% 76%

85%

69% 67%80% 82%

0%

20%

40%

60%

80%

100%

120%

140%

160%

180%

200%

$0.00

$50.00

$100.00

$150.00

$200.00

$250.00

$300.00

$350.00

$400.00

Canola Wheat -Hard Red

Spring

Soybeans Oats Corn Barley Wheat -NorthernHard Red

Wheat -Winter

$ Pe

r Acr

e

Manitoba - 80% Insured Value AgriInsurance Risk Analysis - 2020

80% Insured Value 80% Coverage of Operating Costs 80% Coverage of Total Costs


Canola, Wheat - Hard Red Spring and Soybeans total 79% of the 2019

Seeded Acres and 78% of the 5 Year Average Seeded Acres

Other Crops are 5% of the 2019 Seeded Acres

Analysis of your AgriInsurance Coverage of Operating and Total

Costs is an important step in RiskManagement Planning for your farm.



106% 105% 106%

116% 114%

89%

107%

92%

0%

20%

40%

60%

80%

100%

120%

140%


Spring


Wheat -Winter

Manitoba Breakeven Yield Risk Ratio - 2020

Target Yield as % of B/E Yield


Analysis of ROI (Reward) and the associated AgriInsurance Coverage

of Total Costs (Risk) is useful in comparing the profitability and cost efficiency alongside the production cost risk when evaluating crops to include in your rotation and is an

important step in Risk Management Planning for your farm.

Analysis of your Breakeven Yields compared to Target (or average) Yields gives an indication of how

close to B/E ($0 profit = 100%) each crop in your rotation is if faced with potential production or market price

challenges and is an important step in Risk Management Planning.

5.4% 4.7% 5.7% 16.4% 14.1%

-11.1%

6.6%

-7.9%

85%

77% 76%

85%

69%67%

80% 82%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

-15.0%

-10.0%

-5.0%

0.0%

5.0%

10.0%

15.0%

20.0%


Spring


Wheat -Winter

Manitoba Risk & Reward Analysis - 2020

Return on Investment (Reward) 80% Coverage of Total Costs (Risk)


-$200.00

-$150.00

-$100.00

-$50.00

$0.00

$50.00

$100.00

$150.00

4th weekApril

1st weekMay

2nd weekMay

3rd weekMay

4th weekMay

1st weekJune

2nd weekJune

3rd weekJune

Manitoba Net Profit Based on Seeding Date - 2020

Canola Wheat - Hard Red Spring Soybeans Oats


Seeding Date can have a significant impact on crop yields and net

profitability. Analysis of seeding dates will highlight potential windows of profitability to seed crops in your rotation and is an important step in

Risk Management Planning.



Seeding Rate Price CostCrop per Acre per Unit per Acre

Canola 5 lb $12.50 /lb $62.50* Soybeans 1.43 units $66.50 /unit $95.10

Wheat - Hard Red Spring 2.0 bu $12.00 /bu $24.00Wheat - Northern Hard Red 2.0 bu $11.00 /bu $22.00Wheat - Special Purpose 2.0 bu $11.00 /bu $22.00Wheat - Prairie Spring 2.0 bu $11.00 /bu $22.00Wheat - Winter 2.0 bu $10.00 /bu $20.00Barley 2.0 bu $7.50 /bu $15.00Oats 2.5 bu $7.25 /bu $18.13Corn 30,000 plants $0.0029 /plant $86.25Peas 2.75 bu $12.75 /bu $35.06Fall Rye 1.5 bu $7.00 /bu $10.50Flaxseed 60 lb $0.38 /lb $22.80Beans - Pinto 1.40 units $50.00 /unit $70.00Beans - White 1.25 units $65.00 /unit $81.25Sunflower Oil 20,000 plants $0.0019 /plant $38.00Sunflower Confection 18,000 plants $0.00268 /plant $48.31

* If row cropping, change seeding rate to 1.3 units/acre which reduces seed cost by 10%

Bulk Price Actual Nutrient Nitrogen SulphurFertilizer Type $/tonne $/lb Usage Usage

Nitrogen: (urea) 46-0-0 $500 $0.493 50% -Nitrogen: (NH3) 82-0-0 $790 $0.437 50% -Nitrogen: (liquid) 28-0-0 $320 $0.518 0% -Phosphorus: 11-52-0 $615 $0.432 - -Potash: 0-0-60 $470 $0.355 - -Sulphur: 20.5-0-0-24 $425 $0.382 - 100%

MES S15: 13-33-0-15 $630 $0.527 - 0%

TotalCrop lbs $/acre lbs $/acre lbs $/acre lbs $/acre $/acre

Canola 120 $55.80 40 $17.29 0 $0.00 20 $7.64 $80.73Soybeans 0 $0.00 40 $17.29 0 $0.00 0 $0.00 $17.29Wheat - Hard Red Spring 100 $46.50 40 $17.29 0 $0.00 0 $0.00 $63.79Wheat - Northern Hard Red 120 $55.80 40 $17.29 0 $0.00 0 $0.00 $73.09Wheat - Special Purpose 110 $51.15 40 $17.29 0 $0.00 0 $0.00 $68.44Wheat - Prairie Spring 110 $51.15 40 $17.29 0 $0.00 0 $0.00 $68.44Wheat - Winter 110 $51.15 40 $17.29 0 $0.00 0 $0.00 $68.44Barley 80 $37.20 30 $12.97 0 $0.00 0 $0.00 $50.17Oats 70 $32.55 30 $12.97 0 $0.00 0 $0.00 $45.52Corn 140 $65.10 50 $21.61 25 $8.88 10 $3.82 $99.42Peas 0 $0.00 30 $12.97 0 $0.00 0 $0.00 $12.97Fall Rye 80 $37.20 30 $12.97 0 $0.00 0 $0.00 $50.17Flaxseed 75 $34.88 30 $12.97 0 $0.00 0 $0.00 $47.84Beans - Pinto 70 $32.55 30 $12.97 0 $0.00 0 $0.00 $45.52Beans - White 80 $37.20 30 $12.97 0 $0.00 0 $0.00 $50.17Sunflower Oil 100 $46.50 30 $12.97 30 $10.66 0 $0.00 $70.13Sunflower Confection 100 $46.50 30 $12.97 30 $10.66 0 $0.00 $70.13

*

* For more information on fertilizer rates and recommendations - *

Fertilizer

Seed & Treatment

The fertilizer recommendation will vary depending on the soil type, climate and crop rotation. MARD recommends that soil test sampling and analysis be conducted each year to produce a better baseline for fertility. It costs $1.00 to $2.00/acre for custom sampling and analysis.

Amount of Actual Pounds of Elements Applied Per AcreNitrogen Phosphorus Potash Sulphur

Note: phosphorus amounts are allotted to each crop in the above examples. Sometimes this amount may not be practical or safe to apply with the seed of some crops like soybean or canola. Options for meeting these needs and phosphorus balance through the rotation are provided at:

Nitrogen Rate Calculator

Phosphorus Balance Calculator



Weed Disease Insect TotalControl Control Control Cost

Crop $/acre $/acre $/acre $/acreCanola $14.41 $16.25 $0.00 $30.66Soybeans $10.00 $0.00 $0.00 $10.00Wheat - Hard Red Spring $30.50 $16.50 $0.00 $47.00Wheat - Northern Hard Red $30.50 $16.50 $0.00 $47.00Wheat - Special Purpose $30.50 $16.50 $0.00 $47.00Wheat - Prairie Spring $30.50 $16.50 $0.00 $47.00Wheat - Winter $14.25 $16.50 $0.00 $30.75Barley $35.00 $8.89 $0.00 $43.89Oats $9.38 $10.25 $0.00 $19.63Corn $26.25 $0.00 $0.00 $26.25Peas $14.75 $19.50 $0.00 $34.25Fall Rye $7.50 $0.00 $0.00 $7.50Flaxseed $20.63 $14.50 $0.00 $35.13Beans - Pinto $67.66 $28.57 $0.00 $96.23Beans - White $67.66 $32.73 $0.00 $100.39Sunflower Oil $28.59 $0.00 $0.00 $28.59Sunflower Confection $46.19 $20.50 $5.63 $72.32

Note:

Pre-emergent burn off and/or pre-harvest desiccation not included in weed control costs. (except for wheat, win. wheat and sunflowers).Chemical costs do not include year end rebates or bundling discounts.

Disease Control costs (except for sunflowers listed on Operating Cost Page) do not include custom application costs.

Chemicals

$0

$100

$200

$300

$400

$500

$60020

16

2017

2018

2019

2020

Pric

e ($

/MT)

Average Urea Nitrogen Prices

Previous Fall Spring Previous Fall Trend Spring Trend


$0

$100

$200

$300

$400

$500

$600

$700

$800

$900

2016

2017

2018

2019

2020

Pric

e ($

/MT)

Average 11-52-0 Phosphate Prices

Previous Fall Spring Previous Fall Trend Spring Trend




Interest Rate on Operating 5.50% Grain HaulingLand Taxes ($/acre) $15.00 Distance to storage 6 miles roundtripLabour rate ($/hour) $24.00 Distance to market 45 miles roundtripMachinery Operating ($/acre) $10.00 Grain truck fuel use 5 Miles per Imp. GallonOther Costs ($/acre) $7.75 Grain truck size 475 bushelsFuel Cost ($/litre) $0.95

Labour Crop* Hail Drying StorageCrop (hrs/acre) Fuel Insurance Insurance Costs $/acre** Seeding Application Swathing Harvest General Total

Canola 1.1 $21.09 $7.89 $7.56 - $4.77 - - - - - $0.00Soybeans 1.1 $19.47 $11.53 $8.19 - $4.20 - - - - - $0.00Wheat - Hard Red Spring 1.1 $22.78 $7.77 $6.30 - $6.70 - - - - - $0.00Wheat - Northern Hard Red 1.1 $23.80 $11.61 $6.30 - $7.95 - - - - - $0.00Wheat - Special Purpose 1.1 $23.62 $10.20 $6.30 - $7.72 - - - - - $0.00Wheat - Prairie Spring 1.1 $23.80 $8.13 $6.30 - $7.95 - - - - - $0.00Wheat - Winter 1.1 $23.24 $7.32 $6.30 - $7.27 - - - - - $0.00Barley 1.1 $24.22 $9.75 $6.30 - $9.09 - - - - - $0.00Oats 1.1 $26.53 $9.31 $6.30 - $11.93 - - - - - $0.00Corn 1.1 $28.29 $21.93 $6.30 $35.00 $15.33 - - - - - $0.00Peas 1.1 $17.89 $9.82 $12.60 - $4.88 - - - - - $0.00Fall Rye 1.1 $19.24 $9.66 $6.30 - $6.59 - - - - - $0.00Flaxseed 1.1 $19.83 $9.73 $6.30 - $2.84 - - - - - $0.00Beans - Pinto 1.1 $17.17 $24.97 $11.03 - $3.60 - - - - - $0.00Beans - White 1.1 $17.01 $21.36 $11.03 - $3.41 - - - - - $0.00Sunflower Oil 1.1 $22.45 $14.55 $6.30 $10.00 $8.18 - $8.50 - - - $8.50Sunflower Confection 1.1 $21.98 $28.26 $6.30 $10.00 $7.61 - $17.00 - - - $17.00

* 80% Insured Value - Based on MASC Risk Areas 2, 5, 6, & 12 ** Storage costs are listed under Fixed Costs on the Summary Page.

TotalCrop L/acre 2.25 3.5 0.75 2.5 1.3 0.42 1.13 5.54 2

Canola 22.20 2 1 1 4 1 1 2 4.10Soybeans 20.49 2 2 1 2 1 2 3.61Wheat - Hard Red Spring 23.98 1 1 1 1 4 1 2 5.76Wheat - Northern Hard Red 25.05 1 1 1 1 4 1 2 6.83Wheat - Special Purpose 24.86 1 1 1 1 4 1 2 6.64Wheat - Prairie Spring 25.05 1 1 1 1 4 1 2 6.83Wheat - Winter 24.47 1 1 1 1 4 1 2 6.25Barley 25.49 2 1 1 3 1 1 2 7.81Oats 27.93 2 1 1 3 1 1 2 10.25Corn 29.78 1 1 1 1 3 1 2 13.18Peas 18.83 1 2 1 2 1 2 4.20Fall Rye 20.25 1 1 1 1 1 1 2 5.66Flaxseed 20.87 2 2 1 3 1 1 2 2.44Beans - Pinto 18.07 1 2 1 3 1 1 2 3.09Beans - White 17.91 1 2 1 3 1 1 2 2.93Sunflower Oil 23.63 1 1 1 1 3 1 2 7.03Sunflower Confection 23.14 1 1 1 1 3 1 2 6.54

Operating Costs

cultivator or tandem disk

high speed disk

harrow or land roller air drill

row planter SP sprayer

Field Fuel Usage

Rental and Custom CostsOperating Cost ($/Acre)

swather combine3/4 ton pickup

grain hauling

Trucks L/acreNumber of Field Operations & Litres Fuel Per Acre Per Operation



Land Conventional Special Average Land value ($/acre) $3,000 Machinery Crop Crop Conventional Crop acres 2,000 Total Investment ($/acre) $500.00 $60.00 Special Crop acres 500 Residual Value (End of Useful Life) 25% Owned Land Equity 85% Useful Life (years) 15 Land Financed 15% Owned Equipment Equity 55% Land Opportunity Cost (Investment Rate) 1.50% Equipment Financed 45%Land cost ($/acre) Machinery Opportunity Cost (Investment Rate) 1.50% Finance Rate & Term 4.000% 25 Years Principle & Interest Cost $28.81 Machinery Cost ($/acre) Owned Land Opportunity Cost $38.25 Finance Rate & Term 4.500% 7 Years Total Cost $67.06 Principle & Interest Cost $38.18 $4.58

Machinery Depreciation Cost $25.00 $3.00Grain Storage Usage % Cost Owned Machinery Opportunity Cost $4.13 $0.50 Non-aeration bins 15% $1.75 /bu $67.31 $8.08 Aeration bins 70% $2.40 /bu Hopper bins 15% $4.20 /bu

Storage Financed 60% Machinery Lease cost ($/acre) $2.88

Market Grain Grain Market Grain Grain

Power & Misc Equipment Value Usage % Allocation Harvest Equipment Value Usage % Allocation

4WD Tractor 475HP $250,000 100% $250,000 Combine $260,000 100% $260,000

MFWD Tractor 150HP $100,000 100% $100,000 Swather 35 ft $30,000 100% $30,000

2WD Tractor 60HP $30,000 75% $22,500 PTO Auger 13x70 $15,000 100% $15,000

ATV Quad $6,000 75% $4,500 Auger 8x35 $4,000 100% $4,000

$0 0% $0 Harvest Header $50,000 100% $50,000

$0 0% $0 $0 0% $0

$0 0% $0 $0 0% $0

$0 0% $0 $0 0% $0

Total $377,000 Total $359,000


Seeding, Tillage, Spraying Value Usage % Allocation Trucks & Trailers Value Usage % Allocation

Cultivator $20,000 100% $20,000 Tandem grain truck $60,000 100% $60,000

Harrow 80ft $30,000 100% $30,000 Grain cart $35,000 100% $35,000

Air tank $60,000 100% $60,000 $0 100% $0

Air drill $125,000 100% $125,000 $0 0% $0

SP sprayer $175,000 100% $175,000 $0 0% $0

Miscellaneous $9,000 100% $9,000 $0 0% $0

$0 0% $0 $0 0% $0

$0 0% $0 $0 0% $0

Total $419,000 $419,000 Total $95,000

Owned Equipment TOTAL $1,250,000


Seeding, Tillage, Spraying Value Usage % Allocation Harvest Equipment Value Usage % Allocation

Planter $100,000 100% $100,000 Harvest Header $50,000 100% $50,000

$0 0% $0 $0 0% $0

$0 0% $0 $0 0% $0

$0 0% $0 $0 0% $0

Total $100,000 Total $50,000

Special Equipment TOTAL $150,000

Annual Grain Grain Annual Grain Grain

Seeding, Tillage, Spraying Lease Usage % Allocation Trucks & Trailers Lease Usage % Allocation

enter equipment here $0 0% $0 3/4 ton pickup $9,600 75% $7,200

$0 0% $0 $0 0% $0

$0 0% $0 $0 0% $0

$0 0% $0 $0 0% $0

$0 0% $0 $0 0% $0

$0 0% $0 $0 0% $0

Total $0 $0 Total $7,200

Leased Equipment TOTAL $7,200 $2.88 per acre* Leased equipment costs are listed under Operating Costs on the Summary Page.

Fixed Costs

Conventional Crop Equipment Inventory and Current Values

Special Crop Equipment Inventory and Current Values

Leased Equipment Inventory



Fuel Costs: Includes fuel used for field work, trucking in inputs and trucking out production.

Machinery Operating Costs: Includes costs for maintenance, repairs, licenses and insurance.

Crop Insurance: (2019 rates)

Other Costs: Includes overhead expenses - hydro, telephone, accounting, buildings, supplies and insurance, etc.

Interest On Operating: Interest charges on operating costs are calculated at 5.5% for six months.

Land Cost:

P&I Cost (based on $1,125,000 Mortgage) = $72,013 payments per year) / 2500 acres = $28.81/acre)

Investment = (Total Investment x Owned Equity %) x Investment Rate % (eg. (($3,000 x 85%) x 1.5%) = $38.25/acre)

Machinery Cost:

P&I Cost (based on $562,500 + $67,500 Loans) = $95,457 + $11,455 payments per year) / 2500 acres = $38.18 and $4.58/acre)

Depreciation (Useage Cost) = (Total Investment - Residual Value) / Years Useful Life (eg. ($500 - ($500 x 25%)) / 15 = $25.00/acre)

Investment = (Total Investment x Owned Equity %) x Investment Rate % (eg. ($500 x 55%) x 1.5%) = $4.13/acre)

Depreciation Cost = Original Cost - Salvage Value Useful LifeInvestment Cost = Original Cost + Salvage Value x Investment Rate 2Estimated Farmgate Values:Target crop prices are based on deferred delivery contract prices for fall 2020.Target yields are estimated based on 5 year MASC average yields.

Storage Cost:Storage costs for each crop are based on estimated yields entered on the Summary page. Budget assumed 60% financed at 4% for 20 years.

Profitability, Breakeven & Risk Analysis Formulas:Gross Revenue = Price per unit x Yield per acre (eg. wheat: $6.75/bu x 59bu/ac = $398.25/ac)

Net Profit = Gross Revenue - Total Cost (eg. wheat: $398.25 gross revenue - $380.44 total cost = $17.81 per acre)

Operating Expense Ratio = (Operating Cost / Gross Revenue) x 100 (eg. wheat: $212.97 operating expense / $380.44 total cost = 53.5%)

$ Revenue Per $ Cost = Gross Revenue / Total Cost (eg. wheat: $398.25 gross revenue / $380.44 total cost = $1.05)

Return on Investment (ROI) = (Gross Revenue - Total Cost) / Total Cost (eg. wheat: ($398.25 gross revenue-$380.44 total cost) /$380.44 total cost = 4.7%)

Estimated Return on Asset (ROA) = (Margin Over Operating - Labour - Machinery Depreciation) / (Land Investment Cost + Machinery Investment Cost)

(eg. wheat: ($185.28 margin - $26.40 labour - $25.00 dep.) / ($3000 land cost + $500.00 conv. machinery + $60.00 special crop. mach.) = 3.76%)

Breakeven Price = Cost / Target Yield (eg. wheat cost $380.44 / 59 bu = $6.45 per bu)

Breakeven Yield = Cost / Target Price per Unit (eg. wheat cost $380.44 / $6.75 bu = 56.4 bu)

Breakeven Yield Risk Ratio = (Target Yield per Acre / Breakeven Yield) x 100 (eg. wheat yield 59 bu/ac / 56.4 bu BE = 105 %)

AgriInsurance Risk Ratio = (AgriInsurance Coverage / Operating Cost) x 100 (eg. wheat coverage $293.75/ac / $212.97 operating expense = 138 %)

Created and maintained by January, 2020

For more information, contact your local

Darren Bond Roy Arnott Sharon ArdronFarm Management Specialist A/Manager Farm Management Farm Management Specialist

Land Taxes: The average cost based on land tax assessment and mill rates of a sample of municipalities growing crops less provincial tax rebate.

Drying Costs: Budget allocates costs only for corn and sunflowers. However, drying costs may be incurred in some years for the other crops.

Other Assumptions

80% Insured Value coverage, $50/acre excess moisture Insurance, and additional hail insurance at $200/acre coverage for all crops. Coverage and costs based on MASC Risk Areas #2, 5, 6, and 12.

Farm storage requirements were assumed to cost $1.75/bushel for 15% of the storage, $2.40/bushel for 70% aerated storage and $4.20/bushel for 15% hopper storage.

Based on approximate average land values. Budget assumed 15% financed at 4% for 25 years, plus 1.5% land equity opportunity cost. Budget can be used to estimate cashflow by removing investment cost.

Based on approximate average machinery values. Budget assumed 45% financed at 4.5% for 7 years, depreciation costs over 15 years with a 25% residual value, plus 1.5% machinery equity opportunity cost. Budget can be used to estimate cashflow by removing depreciation and investment cost.

Manitoba Agriculture and Resource Development Farm ManagementManitoba Agriculture and Resource Devlopment Office or:


Contact us• Go to manitoba.ca/agriculture

• Toll free at 1-844-769-6224

• Email us at [email protected]

• Follow us on Twitter @MBGovAg

• Visit your local Manitoba Agriculture and Resource Development Office

Available in alternate formats upon request.

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