Lauer © 1994-2008 University of Wisconsin – Agronomy Establish Realistic Yield Goals Yield...

Lauer © 1994-2008University of Wisconsin –

Agronomyhttp://

corn.agronomy.wisc.edu

Establish Realistic Yield Goals

•Yield Potential of Soil

•Growing Season - Growing Degree Units

•Sub-soil Moisture

•Management Ability and Philosophy

•Attitude Toward Risk

•Willingness to Be Timely

1

What is Your Yield Potential?

Source: Lauer, 2008NCGA (1983-2008), PEPS (1987-2008)

Source: Lauer, 2008NCGA (1983-2008), PEPS (1987-2008)

Highest recorded corn yields. Records set in 2008 have bold values.


Agronomyhttp://


Objectives

• Cost analysis of grain enterprises

• Emphasize soil and water conservation, efficiency, profitability, and competitiveness vs. productivity alone

• Recognize the way efficient growers integrate practices into a system through: PEPS Contest PEPS Workshops

Divisions

• Corn, Cash Crop: Corn following a legume or non-legume grain crop (i.e. corn, soybean, small grain, etc.) or non-legume forage or cover crops No manure applied. A charge for drying costs assessed.

• Corn, Livestock: Corn following forage legume or green-manure legumes (alfalfa, red clover, etc.); and/or manure applied on land. Drying costs will not be assessed.

• Corn silage

• Soybean

PEPS Objectives, Divisions and Districts

Districts


Agronomyhttp://


Calculating Grower Return

Partial Budget Analysis

• Corn Price per bushel

Price matrix: $2.00, $4.00, $6.00

grPEPS: Weighted Price per bushel = 50% November Average Cash price + 25% March CBOT Futures ($0.15 basis) + 25% July CBOT Futures ($0.10 basis) November Average Cash price derived from WI Ag Statistics; CBOT

Futures prices derived from closing price on first business day in December.

• Grower return = (Yield x Price) - Input costs- Handling ($0.02 per bushel) - Hauling ($0.04 per bushel) - Trucking (system rate)- Drying (system rate per bushel-point > 15.5%) - Storage (system rate per 30 day)

Marketing plan: 50% sold at harvest, 25% at 4 months, and 25% at 8 months.

• Corn Production Systems

Livestock: drying=$0.00, trucking=$0.00, storage=$0.01

On-farm: drying=$0.02, trucking=$0.11, storage=$0.02

Commercial: drying=$0.04, trucking=$0.11, storage=$0.03

3


Agronomyhttp://


Pricing Corn SilageLinn (Minnesota)

Silage value ($/T) = Base price + Starch adjustment + NDFD adjustment

• Base price = Cost of production $60 per DM Ton

• Starch adjustment =

(starch% – 29%) x (0.5 bu/starch) x (corn price $/bu) 29% = average starch content of corn derived from Dairyland Labs

0.5 bu/T = 1% change in starch content

• NDFD adjustment =

(NDFD%) x (0.6 lb milk/NDFD) x (milk price $/lb) 0.6 lb milk = 1% NDFD derived from Allen (48-hr digestion)

4


Agronomyhttp://


Differences between the High (20%) and Low (20%) profit groups

Cash Corn(n=108)

Livestock Corn(n=77)

Soybean(n=96)

High20%

Low20%

High20%

Low20%

High20%

Low20%

Grain yield (bu/A) 221 172 222 165 63 46

Grain moisture (%) 18.7 20.6 18.1 22.5 12.2 12.2

Acre Cost ($/A) $315 $313 $272 $296 $194 $195

Bushel cost ($/bu) $1.43 $1.83 $1.09 $1.84 $3.09 $4.32

Grower return ($/A) $204 $74 $230 $92 $220 $124

Source: Lauer (1987-2007)Source: Lauer (1987-2007)


Agronomyhttp://


How much does it cost to produce corn in WI?

Source: LauerSource: Lauer


Agronomyhttp://


Corn and Soybean Cost of Production and Grower Return



Agronomyhttp://


Corn and Soybean Cost of Production ($/A)

23

45

1

DistrictCashcorn

Livestock

cornSoybea

n

(n=108)

(n=77) (n=96)

1 $318 $250 $182

2 $311 $274 $183

3 $310 $258 $197

4 $327 $309 $210

5 $378 $353 $249

Average

$321 $276 $196

Source: Lauer (2003-2007)Source: Lauer (2003-2007)


Agronomyhttp://


Average corn production costs for major inputs



Agronomyhttp://


Number of Participants in PEPS(n= 2173)


Agronomyhttp://


• Verified yields and production costs

History

Comparative

• Since 1997, placing based on profitability

Prior to 1997, placing based on lowest cost per bushel

• Soil loss within tolerable “T” level

USLE; USDA-NRCS

• Entry fee = $25, no limit to number of entries

• Entry deadline = August 1

• Awards = $100 to winner for each district/division

• Total fields evaluated = 2340

PEPS Contest does not account for:

• Overhead Usually assessed at 18 to 46 % of

production costs Examples include:

Plowing snow Fixing fence Property taxes / “Real” land costs Equipping shop Alimony Farm pick-up Tiling Desk management

• “Best of the Best” – Low yielding fields not usually entered

PEPS Contest Strengths and Weaknesses


Agronomyhttp://


How can you get involved in PEPS?

•Contest versus Verification options

•Does it pay to grow corn on my farm?Do I know my production costs?

If I do, how do I compare?

How efficient is my operation?

Am I a good steward?

If I make changes, how does that affect my bottom-line?

•What role can agents/dealers/consultants play in PEPS?Promote among producers who would benefit (helping with forms,

soil loss and yield checks)

Encourage National Corn Growers Association yield contestants to enter

Provide input to PEPS committee from “real world”

Financial sponsorship


Agronomyhttp://


Know Your Production CostsChanges in Grower Return With PEPS Participation

Source: Lauer (PEPS, 1987-2003, n= 128)Source: Lauer (PEPS, 1987-2003, n= 128)

Lauer © 1994-2008 University of Wisconsin – Agronomy Establish Realistic Yield Goals Yield...

Documents

Transcript of Lauer © 1994-2008 University of Wisconsin – Agronomy Establish Realistic Yield Goals Yield...