Cost of Production Crops - Province of Manitoba

2021 Cost of Production

Crops

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Guidelines For Estimating

Crop Production Costs - 2021

Date: January, 2021

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.

This tool is available as an Excel worksheet at: manitoba.ca/agriculture or at your local Manitoba Agriculture and Resource Development office. The Farm Machinery Custom and Rental Rate Guide is also available to help determine machinery costs.

The CropPlan Production Cost Calculator

is also available for producers to

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.

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.

Guidelines: Crop Production Costs

2

Crop Production Costs 2021 Guidelines (Dollars Per Acre)

A. Operating Costs Seed & Treatment Fertilizer Pesticide Fuel Machinery Operating & Lease Labour - Hired Crop Insurance Hail Insurance Drying & Other Costs Land Taxes Storage Costs Interest on Operating Total Operating

Canola

Wheat Hard Red

Spring

Soybeans

Oats

Corn

Barley

Wheat Northern Hard Red

Peas

$67.50 $88.16 $30.91 $20.82 $12.88

$4.80 $7.77 $6.35 $7.75 $15.00 $5.11 $6.01 $273.06

$29.00 $76.90 $47.23 $21.64 $12.88

$4.80 $6.64 $6.35 $7.75 $15.00 $6.93 $5.29 $240.40

$93.38 $23.88 $10.47 $18.71 $12.88

$4.80 $12.16

$8.26 $7.75 $15.00 $4.20 $4.76 $216.25

$19.38 $57.42 $19.63 $25.79 $12.88

$4.80 $11.12

$6.35 $7.75 $15.00 $12.49 $4.33 $196.94

$96.00 $112.21

$27.45 $26.59 $12.88

$4.80 $21.29

$6.35 $42.75 $15.00 $15.33

$8.56 $389.21

$18.00 $62.53 $51.50 $23.30 $12.88

$4.80 $8.30 $6.35 $7.75 $15.00 $9.09 $4.94 $224.44

$27.00 $83.87 $47.23 $22.38 $12.88

$4.80 $8.78 $6.35 $7.75 $15.00 $7.95 $5.49 $249.49

$50.49 $18.82 $34.25 $17.93 $12.88

$4.80 $8.47 $12.70 $7.75 $15.00 $5.22 $4.24 $192.55

B. Fixed Costs Land Costs Machinery Costs Total Fixed

$69.29 $67.31 $136.60

$69.29 $67.31 $136.60

$69.29 $67.31 $136.60

$69.29 $67.31 $136.60

$69.29 $75.38 $144.68

$69.29 $67.31 $136.60

$69.29 $67.31 $136.60

$69.29 $67.31 $136.60

C. Owners - Labour & Living

$24.00 $24.00 $24.00 $24.00 $24.00 $24.00 $24.00 $24.00

Total Costs

$433.66 $401.00 $376.84 $357.54 $557.89 $385.03 $410.09 $353.15

Estimated Farmgate Target Price $ per unit Premium $ per unit Target Yield per acre Unit type (bu. or lb.) Gross Revenue / acre

Profitability Analysis

$11.25 $0.00 45 bu

$506.25

$6.75 $0.00

61 bu $411.75

$11.40 $0.00 37 bu

$421.80

$3.75 $0.00

110 bu

$412.50

$4.75 $0.00

135 bu

$641.25

$4.75 $0.00

80 bu $380.00

$6.25 $0.00

70 bu $437.50

$8.00 $0.00

46 bu $368.00

Operating Expense Ratio

53.9% 58.4% 51.3% 47.7% 60.7% 59.1% 57.0% 52.3%

Marginal Returns Over Operating Costs Over Total Costs (Net Profit)

Profitability Ranking

$233.19 $72.59 4

$171.35 $10.75 12

$205.55 $44.96 6

$215.56 $54.96 5

$252.04 $83.36 3

$155.56 $188.01

($5.03) $27.41

15

7

$175.45 $14.85 10

Return on Investment (ROI) Return on Asset (ROA)

Breakeven Price Per Unit Over Operating Costs Over Land Costs Over Machinery Costs Over Owners Labour & Lliving Over Total Costs

Breakeven Yield (Bu or lb.) Over Operating Costs Over Land Costs Over Machinery Costs Over Owners Labour & Lliving Over Total Costs

Breakeven Yield Risk Ratio

(Target Yield per Acre / BE Yield)

16.74% 5.03%

2.68% 3.34%

11.93% 15.37% 14.94% 4.28% 4.55% 5.55%

Breakeven Analysis

(1.31%) 2.91%

6.68% 3.80%

4.21% 3.45%

$6.07 $1.54 $1.50 $0.53 $9.64

$3.94 $1.14 $1.10 $0.39 $6.57

$5.84 $1.87 $1.82 $0.65 $10.18

$1.79 $0.63 $0.61 $0.22 $3.25

$2.88 $0.51 $0.56 $0.18 $4.13

$2.81 $0.87 $0.84 $0.30 $4.81

$3.56 $0.99 $0.96 $0.34 $5.86

$4.19 $1.51 $1.46 $0.52 $7.68

24.3 6.2 6.0 2.1

38.6 117%

35.6 10.3 10.0

3.6 59.5 103%

19.0 6.1 5.9 2.1

33.1 112%

52.5 18.5 17.9

6.4 95.3 115%

81.9 14.6 15.9

5.1 117.5 115%

47.2 14.6 14.2

5.1 81.1 99%

39.9 11.1 10.8

3.8 65.6 107%

24 8.7 8.4 3.0 44.1 104%

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.

Manitoba Agriculture and Resource Development

Guidelines: Crop Production Costs

3

Hybrid Fall Rye

Wheat Winter

Crop Production Costs 2021 Guidelines (Dollars Per Acre)

Beans Pinto

Wheat Prairie Spring

Sunflower

Flaxseed

Oil

Beans White

Sunflower Confection

Wheat Other Spring

Your Farm

$12.00 $93.17

$7.50 $18.81 $12.88

$4.80 $11.68

$6.35 $7.75 $15.00 $8.29 $4.46 $202.69

$25.00 $79.22 $30.98 $22.13 $12.88

$4.80 $6.39 $6.35 $7.75 $15.00 $7.61 $4.91 $223.02

$82.50 $47.74 $96.23 $17.50 $12.88

$4.80 $22.66 $11.11

$7.75 $15.00

$3.60 $7.24 $329.01

$27.00 $83.87 $47.23 $22.38 $12.88

$4.80 $6.66 $6.35 $7.75 $15.00 $7.95 $5.44 $247.31

$25.20 $38.44 $35.13 $19.67 $12.88

$4.80 $10.32

$6.35 $7.75 $15.00 $2.84 $4.01 $182.39

$40.00 $72.58 $28.59 $21.36 $21.38

$4.80 $13.86

$6.35 $17.75 $15.00

$8.18 $5.62 $255.46

$78.10 $52.39 $100.39 $17.30 $12.88

$4.80 $19.38 $11.11

$7.75 $15.00

$3.31 $7.25 $329.66

$49.50 $72.58 $72.32 $21.03 $29.88

$4.80 $26.27

$6.35 $17.75 $15.00

$7.72 $7.27 $330.47

$27.00 $76.90 $47.23 $21.80 $12.88

$4.80 $8.37 $6.35 $7.75 $15.00 $7.16 $5.29 $240.52

$69.29 $67.31 $136.60 $24.00 $363.28

$69.29 $67.31 $136.60 $24.00 $383.62

$69.29 $72.69 $141.98

$69.29 $67.31 $136.60

$69.29 $67.31 $136.60

$69.29 $75.38 $144.68

$24.00 $24.00 $24.00 $24.00

$494.99 $407.91 $342.99 $424.14

Profitability Analysis

$69.29 $72.69 $141.98 $24.00 $495.65

$69.29 $75.38 $144.68 $24.00 $499.14

$69.29 $67.31 $136.60 $24.00 $401.12

$5.25 $0.00

73 bu $383.25

52.9%

$5.75 $0.00

67 bu $385.25

57.9%

$0.33 $0.00 1,900

lb $627.00

52.5%

$5.75 $0.00

70 bu $402.50

61.4%

$14.00 $0.00 25 bu

$350.00

52.1%

$0.25 $0.00 1,800

lb $450.00

56.8%

$0.35 $0.00 1,750

lb $612.50

53.8%

$0.30 $0.00 1,700

lb $510.00

64.8%

$5.75 $0.00

63 bu $362.25

66.4%

$180.56 $19.97 9

$162.23 $1.63 14

$297.99 $132.01

1

$155.19 $167.61

($5.41) $7.01

16

13

$194.54 $25.86 8

$282.84 $116.85

2

$179.53 $10.86 11

$121.73 ($38.87)

17

5.50% 3.59%

0.42% 26.67% (1.33%) 3.09% 6.80% 2.90%

2.04% 3.24%

6.10% 23.58% 3.98% 6.39%

2.17% (9.69%) 3.57% 1.99%

Breakeven Analysis

$2.78 $0.95 $0.92 $0.33 $4.98

38.6 13.2 12.8

4.6 69.2 105%

$3.33 $1.03 $1.00 $0.36 $5.73

$0.17 $0.04 $0.04 $0.01 $0.26

39 12.1 11.7

4.2 67.0 100%

997 210.0 220.3

72.7 1500.0

127%

$3.53 $0.99 $0.96 $0.34 $5.83

$7.30 $2.77 $2.69 $0.96 $13.72

$0.14 $0.04 $0.04 $0.01 $0.24

$0.19 $0.04 $0.04 $0.01 $0.28

$0.19 $0.04 $0.04 $0.01 $0.29

43.0 12.1 11.7

4.2 71.0 99%

13.0 4.9 4.8 1.7

24.4 102%

1022 277.2 301.5

96.0 1696.7

106%

942 198.0 207.7

68.6 1416.3

124%

1101.6 231.0 251.3 80.0

1663.9 102%

$3.82 $1.10 $1.07 $0.38 $6.37

42 12.1 11.7

4.2 70.0 90%

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.

Manitoba Agriculture and Resource Development

Guidelines: Crop Production Costs

4

AgriInsurance Analysis

Canola

Wheat Hard Red

Spring

Soybeans

Oats

Corn

Barley

Wheat Northern Hard Red

Peas

AgriInsurance 80% Insured Value Premium Cost (% of Insured)

$360.41 $312.70 $299.03 $309.49 $440.50 $231.12 $289.82 $215.84

2.2%

2.1%

4.1%

3.6%

4.8%

3.6%

3.0%

3.9%

Costs Not Covered By AgriInsurance

Operating Costs

$0.00

Operating & Fixed Costs

$0.00

Total Costs

$73.24

$0.00 $0.00 $88.29

$0.00 $0.00 $77.81

$0.00 $0.00 $48.05

$0.00 $0.00 $117.39

$0.00 $0.00 $153.91

$0.00 $0.00 $120.27

$0.00 $0.00 $137.30

AgriInsurance Risk Ratio Operating Costs Total Costs

(AgriInsurance Coverage / Cost)

132% 130% 138%

83%

78%

79%

157% 87%

113% 79%

103% 60%

116% 71%

112% 61%

Risk Ranking

10

9

11

17

5

2

6

4

(Lower number indicates increasing risk)

Risk & Sensitivity Analysis (Stress Test)

Percent Market Price Change (2%) Percent Crop Yield Change 0%

Change in Equipment Change in Owned Acres (Purchase or

Canola

Wheat Hard Red

Spring

Soybeans

Oats

Corn

Barley

Wheat Northern Hard Red

Peas

Change in Profit (Loss) $/acre

($15.62) ($13.73) ($13.93) ($13.74) ($18.32) ($13.09) ($14.24) ($12.85)

Adjusted Net Profit (Loss) $/acre Adjusted Profitability Ranking

$56.97 4

($2.97) $31.03

11

6

$41.22 5

$65.05 ($18.13) $13.17

3

15

7

$2.00 10

Stress Test - Total Farm Debt ($/acre) = $742 (land debt of $465/acre + machinery debt of $277/acre, farm equity =

(compared to baseline - Total Farm Debt ($/acre) = $717 land debt of $465/acre + machinery debt of $252/acre, farm equity = 80.4%)

Rotation Economic Analysis

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

Year 1 Year 2

Example Rotation #1

Rotation Yield Premium Net Profit (Loss)

Wheat - Hard Red

Spring

100% $10.75

Canola 102% $82.72

Year 3

Wheat - Hard Red

Spring 101% $14.87

Year 4

Canola 102% $82.72

Year 5

Wheat - Hard Red

Spring 101% $14.87

Year 6

Canola 102% $82.72

Rotation Total

Marginal Return

$289

Example Rotation #2

Rotation Yield Premium Net Profit (Loss)

Corn 100% $83.36

Canola 112% $133.34

Wheat - Hard Red

Spring

101% $14.87

Soybeans 101%

$49.17

Corn 103% $102.60

Canola 112% $133.34

Rotation Total

Marginal Return

$517

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.

Manitoba Agriculture and Resource Development

Guidelines: Crop Production Costs

5

AgriInsurance Analysis

Hybrid Fall Wheat -

Rye

Winter

Beans Pinto

Wheat Prairie Spring

Sunflower

Flaxseed

Oil

Beans - Sunflower White Confection

Wheat Other Spring

Your Farm

$304.68 $285.78 $469.63 $263.38 $260.55 $353.47 $471.94 $427.11 $245.06

3.8%

2.2%

4.8%

2.5%

4.0%

3.9%

4.1%

6.2%

3.4%

$0.00 $0.00 $58.60

$0.00 $0.00 $97.84

$0.00 $0.00 $25.36

$0.00 $0.00 $144.54

$0.00 $0.00 $82.43

$0.00 $0.00 $70.67

$0.00 $0.00 $23.71

$0.00 $0.00 $72.03

$0.00 $0.00 $156.06

150% 84%

128% 74%

143% 95%

106% 65%

143% 76%

138% 83%

143% 95%

129% 86%

102% 61%

16

7

13

3

14

12

15

8

1

Risk & Sensitivity Analysis (Stress Test)

t Investment ($/Acre) $25 r Sale @ $3,100/acre) 0

= $5.49 increased equipment cost /acre = $0.00 increased land cost /acre

Hybrid Fall Wheat -

Rye

Winter

Beans Pinto

Wheat Prairie Spring

Sunflower

Flaxseed

Oil

Beans - Sunflower White Confection

Wheat Other Spring

($13.16) ($13.20) ($18.03) ($13.54) ($12.49) ($14.49) ($17.74) ($15.69) ($12.74)

$6.81 ($11.57) $113.98 ($18.95)

9

14

1

16

($5.48) $11.37

13

8

$99.11 2

($4.84) ($51.61)

12

17

79.9%)

Your Farm

Example Rotation #3

Rotation Yield Premium Net Profit (Loss)

Rotation Economic Analysis

Year 1

Wheat - Hard Red

Spring 100% $10.75

Year 2

Canola 102% $82.72

Year 3 Year 4 Year 5 Year 6

Oats 101% $59.09

Soybeans 100%

$44.96

Corn 103% $102.60

Sunflower Confection

119% $107.76

Rotation Total Marginal Return

$408

Your Farm Rotation

Rotation Yield Premium Net Profit (Loss)

Soybeans 100%

$44.96

Wheat - Hard Red

Spring

108% $43.69

Canola 102% $82.72

Soybeans 100%

$44.96

Wheat - Hard Red

Spring

108% $43.69

Canola 102% $82.72

Rotation Total Marginal Return

$343

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.

Manitoba Agriculture and Resource Development

Guidelines: Crop Production Costs

6

MASC - 2020 Seeded Acres

Wheat - Hard Red Spring, 2,727,441

Soybeans, 1,103,974

Oats, 647,043

Canola, 3,373,943

Corn, 306,544

Barley, 383,142

Wheat - Northern Hard Other, 686,096 Red, 138,048

Canola, Wheat - Hard Red Spring and Soybeans total 77% of the 2020

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

Manitoba Agriculture & Resource Development

Other Crops are 7% of the 2020 Seeded Acres

MASC - 2020 Other Crop Seeded Acres

Flaxseed, 48,392

Hybrid Fall Rye, 100,496

Beans - Pinto, Wheat - Prairie

95,417

Spring, 41,233

Sunflower Oil, 65,716

Sunflower Confection,

24,625

Peas, 155,865

Beans - White, 42,923

Black Bean, 20,940 Wheat - Other Spring, 3,587 Hempseed, 11,308

Wheat - Winter, 29,013

Kidney Bean, 12,402

Canaryseed, 5,120 Fababean, 6,679

Lentil, 2,522

Buckwheat, 5,681

Manitoba Agriculture & Resource Development

Manitoba - 80% Insured Value AgriInsurance Risk Analysis - 2021

$500.00 $450.00 $400.00 $350.00 $300.00 $250.00 $200.00 $150.00 $100.00

132% 83%

130% 78%

138% 79%

157% 87%

113% 79%

103% 60%

116% 71%

112% 61%

180% 160% 140% 120% 100% 80% 60% 40%

$50.00

20%

$0.00

Canola Wheat - Soybeans Oats Hard Red Spring

0% Corn Barley Wheat - Peas

Northern Hard Red

80% Insured Value

80% Coverage of Operating Costs

80% Coverage of Total Costs

Manitoba Agriculture & Resource Development

Analysis of your AgriInsurance Coverage of Operating and Total Costs is an important step in Risk Management Planning for your farm.

$ Per Acre

Manitoba Agriculture and Resource Development

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