OSU Enterprise Budgets – 2008

Budgeting is essential to helping you make important decisions regarding the commitment of resources to the most profitable enterprises on the farm. Budgeting will help you answer many questions. Crops or Livestock? Corn, Soybeans, or Wheat? Should I invest more of my resources in high-value crops?

Budgets that are well thought out and prepared, showing all revenue and costs can help you answer these questions. Without some form of budgeting and some method to track your enterprises’ progress, it will be a very difficult process to determine your most profitable enterprise(s) and if you’ve met your goals for the farm.

Ohio State University Extension has had a long history of developing “Enterprise Budgets” that can be used as a starting point for producers in their budgeting process. Newly updated Enterprise Budgets for 2008 have been completed and posted to the Farm Management Website of the Department of Agricultural, Environmental, and Development Economics. These budgets can be found at the following website:
http://aede.osu.edu/Programs/FarmManagement/Budgets/

Enterprise Budgets updated for 2008 include:
• Corn – Conservation Tillage (NH3, UAN and Urea as Nitrogen sources)
• Soybeans – Round-up Ready, No-till
• Wheat – Conservation Tillage, (Grain and Straw)
• Alfalfa Hay – Spring Seeding
• Grass hay – Large Bale System
• Dairy Cow and Replacement – Large Breed
• Ewe and Lamb – Winter Lambing
• Retail Sweet Corn – Conservation Tillage, Hand Harvested
• Large-Scale Popcorn – Conservation Tillage

Our enterprise budgets are compiled on downloadable Excel Spreadsheets that contain formulas for ease of use. For those of you without Microsoft Office, you can use the freeware office suite “OpenOffice” to view these files. You can access this at http://ww.openoffice.org. Users can input their own production and price levels to calculate their own numbers. These Enterprise Budgets have a new look with color coded cells that will enable users to plug in numbers to easily calculate bottom lines for different scenarios. We have included detailed footnotes to help explain the methods and sources used to obtain the budget numbers. Starting this year, we will be updating these Enterprise Budgets periodically during the year to reflect any large changes in prices or costs. Budgets will include a date in the upper right-hand corner of the front page indicating when the last update occurred.

Another major update to these budgets is the addition of a “Machinery Costs” page. We make it available to show all the steps involved in the calculations of the machinery. Click the “Machinery Costs” tab at the bottom of the spreadsheet to view these expanded calculations.

Included in the Sweet Corn budget is a new system for calculating chemical costs. As an alternative to inputting the chemical costs directly, the budget separates the chemical applications by different growth periods (i.e. at planting and during silking for insecticides). Users can input the application rate (by typing the number in the yellow box, then selecting the unit in the dropdown cell in green) and their cost per unit (the unit will automatically change, so users can leave this as is) and the budget formulas will do the calculations for you and give you the chemical costs at various stages. This system is a trial and we are asking for feedback. Please e-mail your constructive feedback to: Brian Freytag, freytag.21@osu.edu

Highlights (or lowlights) of this years Crop Enterprise Budgets include increased prices for diesel and nitrogen. Three different Corn Production Budgets were developed to view the cost implications of using different nitrogen sources. We have included Anhydrous Ammonia (NH3), UAN (or 28% Nitrogen), and Urea. To help streamline your ability to view the costs of the fertilizers per acre, simply go to the Fertilizer footnote in any crop budget (usually footnote 3 or 4) and input the costs per ton of Nitrogen, MAP and Potash, and the budget formula will automatically calculate the cost per lb. of actual N, P2O5, or K2O for you.

The entire set of Enterprise Budgets can be accessed at:
http://aede.osu.edu/Programs/FarmManagement/Budgets/

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