economics

2024 Ohio Farm Custom Rates Released

| https://u.osu.edu/ohioagmanager/2024/07/01/2024-ohio-farm-custom-rates-released/

(This article originally posted at 2024 Ohio Farm Custom Rates Released | Ohio Ag Manager (osu.edu))

Farming is a complex business and many Ohio farmers utilize outside assistance for specific farm-related work. This option is appealing for tasks requiring specialized equipment or technical expertise. Often, having someone else with specialized tools perform tasks is more cost effective and saves time. Farm work completed by others is often referred to as “custom farm work” or more simply, “custom work”. A “custom rate” is the amount agreed upon by both parties to be paid by the custom work customer to the custom work provider.

Custom rates increased for the majority of field operations in 2024 as compared to surveyed rates in 2022 but the increases did vary by operation. Examples include an increase of 6% for Planting Corn (30 Inch Rows with Fertilizer Application), 5.6% for Harvesting Corn (Combine, Grain Cart, Haul Local to Farm), 21% for Spraying (Self-Propelled Sprayer, Crop Protection Chemicals) and 24% for Field Cultivator.

New field operations in this year’s survey and summary include drone/UAV application and cover crop seeding.

Ohio Farm Custom Rates

Click here for PDF of the 2024 Ohio Farm Custom Rates

The “Ohio Farm Custom Rates 2024” publication reports custom rates based on a statewide survey of 333 farmers, custom operators, farm managers, and landowners conducted in 2024. These rates, except where noted, include the implement and tractor if required, all variable machinery costs such as fuel, oil, lube, twine, etc., and labor for the operation.

Some custom rates published in this study vary widely, possibly influenced by:

  • Type or size of equipment used (e.g. 20-shank chisel plow versus a 9-shank)
  • Size and shape of fields
  • Condition of the crop (for harvesting operations)
  • Skill level of labor
  • Amount of labor needed in relation to the equipment capabilities
  • Cost margin differences for full-time custom operators compared to farmers supplementing current income

Some custom rates reflect discounted rates as the parties involved have family or community relationships. Discounted rates may also occur when the custom work provider is attempting to strengthen a relationship to help secure the custom farmed land in a future purchase, cash rental or other rental agreement. Some providers charge differently because they are simply attempting to spread their fixed costs over more acreage to decrease fixed costs per acre and are willing to forgo complete cost recovery.

Charges may be added if the custom provider considers a job abnormal such as distance from the operator’s base location, difficulty of terrain, amount of product or labor involved with the operation, or other special requirements of the custom work customer.

The data from this survey are intended to show a representative farming industry cost for specified machines and operations in Ohio. As a custom farm work provider, the average rates reported in this publication may not cover your total costs for performing the custom service. As a customer, you may not be able to hire a custom service for the average rate published in this factsheet.

It is recommended that you calculate your own costs carefully before determining the custom rate to charge or pay. It may be helpful to compare the custom rates reported in this fact sheet with machinery costs calculated by economic engineering models available online. The following resources are available to help you calculate and consider the total costs of performing a given machinery operation.

  • Farm Machinery Cost Estimates, available by searching University of Minnesota.
  • Illinois Farm Management Handbook, available by searching University of Illinois farmdoc.
  • Estimating Farm Machinery Costs, available by searching Iowa State University agriculture decision maker and machinery management.

Volatility in diesel price may sometimes cause concern for custom rate providers that seek to cover all or most of the costs associated with custom farm operations. The approximate price of diesel fuel during the survey period (January – April 2024) ranged from $3.20 – $3.50 per gallon for off-road (farm) usage. As a custom farm work provider, if you feel that your rate doesn’t capture your full costs due to fuel price increases you might consider a custom rate increase or fuel surcharge based on the increase in fuel costs.

The complete “Ohio Farm Custom Rates 2024” publication is available online at the Farm Office website: https://farmoffice.osu.edu/farm-management/custom-rates-and-machinery-cost

 

Author information:

Barry Ward (Leader, Production Business Management, Ohio State University Extension, Agriculture and Natural Resources), Eric Richer (Field Specialist, Farm Management, Ohio State University Extension, Agriculture and Natural Resources), John Barker (Extension Educator, Agriculture/Amos Program, Ohio State University Extension Knox County) and Amanda Bennett (Extension Educator, Agriculture & Natural Resources, Ohio State University Extension Miami County)

Corn, Soybean, Soil Health, Grain Storage Economics meeting in Licking County March 6

| Clifton Martin

What crop has the smallest yield penalty for delayed planting? Can you adjust your management practices to mitigate losses due to late planting? How are diseases affected by planting date?

Have you been following the “Battle for the Belt” through this last crop season? We are bringing this discussion to Licking County on March 6th.  The morning sessions are a statewide program offered in 3 locations and we have added lunch and afternoon sessions that address concerns in our part of the state.

This will take place at OSU Newark / COTC.

Cost is $10 and includes a meal.

Call the office 740-670-5315 to register.

Speakers include:

Laura Lindsey  – OSU Professor Soybean and Small Grain Production

Osler Ortez – OSU Assistant Professor – Corn & Emerging Crops

Horacio Lopez-Nicora – OSU Assistant Professor Soybean Pathology and Nematology

Eric Richer – Assistant Professor Field Specialist, Farm Management, OSU Extension “Good Questions to Ask when Investing in On-Farm Storage”

Jim Ippolito – The Rattan Lal Endowed Professor of Soil Health and Soil Fertility, Ohio State  speaking on “Soil Health Perspectives from the New Guy”

PROGRAM FLYER

PROGRAM REGISTRATION

Grain Marketing Meeting to be Held in Zanesville on March 14 (save-the-date)

| Clifton Martin

A grain marketing meeting will be held in Zanesville, OH, March 14, 2024, 6:00 PM at the OSU Extension Office, 225 Underwood St, Zanesville, OH.  This workshop will focus on grain marketing and grain storage considerations for the upcoming cropping year with a focus on grain storage opportunities for the farm.  More details will be released shortly.

Contact the OSU Extension Muskingum County office with questions.

Ohio Beef School Webinars Start January 11

| https://u.osu.edu/beef/2023/01/04/virtual-beef-school-begins-on-january-11/

The OSU Extension Beef Team is offering a Virtual Beef School with one webinar per month beginning next week and concluding in April. The first webinar features new OSU Extension Farm Management Field Specialist, Eric Richer who will be discussing agricultural input costs in 2023. The second topic of the evening will be Cattle Markets and Outlook presented by Garth Ruff, OSU Extension Beef Cattle Field Specialist at 6:30 p.m. on Wednesday, January 11, 2023.

The next three sessions are as follows:

February 8 – Managing Reproduction. Presynchronization and Improving Fertility of Beef Cows: Alex Crist, OSU Animal Science and Synchronization and Natural Service: Dean Kreager, OSU Extension.

March 8 – Herd Health Management. Asian Longhorn Tick and Theileria: Dr. Risa Pesepane, OSU Vet Preventative Medicine and Managing Disease in 2023: Dr. Justin Kieffer, OSU Animal Sciences.

April 12 – Beef Team Round Table – Ask Questions and Discuss Answers with OSU Extension Beef Team Members

Interested attendees can register for this and any of the other webinars for free by visiting: go.osu.edu/beefschool23.

 

This content originally published in the Ohio Beef Cattle Letter

OSU Beef Team Hosts Dr Andrew Griffith Discussing Supply, Demand, and Beef Cattle Market Projections (Recording)

| Clifton Martin

On January 24, 2022, the Ohio State University Extension Beef Team was pleased to host a 2022 Beef Market Outlook meeting featuring Dr. Andrew Griffith, Associate Professor of Agriculture and Resource Economics at the University of Tennessee. Dr. Griffith covered supply, demand, and beef cattle market projections as well as offered insight into supply chain disruptions, input costs, and beef industry trends.

Agricultural Policy and Outlook Conference

| Clifton Martin

COLUMBUS, Ohio – Organizers of the 2020 Agricultural Policy and Outlook Conference hosted by the Department of Agricultural, Environmental, and Development Economics (AEDE) at The Ohio State University, say the aim of this year’s conference is to offer much-needed insight to those involved in the agricultural industry during a time marked with so much global uncertainty. Past attendees, ranging from producers to consumers and agribusinesses leaders to elected officials, say the annual conference provides information and outlooks that influence their businesses and decision making processes.

A core mission of Land-grant institutions like Ohio State is to take research and knowledge from the university and share it with those in the communities they serve. This mission remains at the fore front even when social distancing measures prevent large group gatherings. According to Ben Brown, assistant professor of agricultural risk management at The Ohio State University College of Food, Agricultural, and Environmental Sciences (CFAES), the virtual, four-day event will be structured in a way that provides an even wider variety of perspectives and viewpoints from policymakers to academics to industry leaders, giving the conference a unique degree of depth on topics.

“Unfortunately, we cannot be together in-person sharing thoughts over a baked potato bar,” says Brown. “But this virtual format offers a smorgasbord of impactful economic and policy information from a corral of experts.”

Brown adds that this conference with its access to leading subject matter experts within Ohio and across the country, is walking the walk of being a modern land grant institution.

Bailey Elchinger who works for StoneX Inc., a global institutional-grade financial service network and who will be a panelist on day four of the conference, plans to attend all four sessions so she can gain information to empower her customers with the grain market information and historical analysis required to make sound business decisions for their operations.

“Ideally, producers make grain marketing decisions based more on ‘dollars and cents’ than ‘ifs and buts,’” says Elchinger.

With the pandemic continuing to effect markets and demand, Amanda Douridas, an OSU Extension Educator, plans to attend the conference so she can best inform producers in Champaign County as they continue to weather supply chain disruptions and react to the unexpected effects of the volatile grain markets on their farm incomes. She says the conference is critical to gain some understanding of what markets and policy may look like moving forward.

Other big issues covered during the week:

  • Trade and macroeconomic policy outlooks and how agriculture could be impacted,
  • The enduring impact of COVID-19 travel restrictions and border closures, along with continued immigration policy uncertainty, on the industry’s access to a stable and healthy labor pool,
  • If and when consumer purchasing behaviors will revert to pre-COVID patterns, and
  • Outlooks for the US livestock sector facing global income impacts and a grain and oilseed sector witnessing rapidly improving fundamentals.

Bennett Musselman, a producer in Pickaway County and agricultural service provider, says the line-up of speakers is top notch and the variety of topics will help him keep up to date on the many areas that impact the agricultural industry from local, state, national and global levels. He continues, “If you are in the agricultural industry in any capacity this is a must attend event as the information provided is invaluable.”

The conference is free and open to the public. For the complete program and to register, visit https://aede.osu.edu/programs/20202019-agricultural-policy-and-outlooks. For questions, contact Ben Brown at brown.6888@osu.edu or Kelli Trinoskey at Trinoskey.1@osu.edu.