COP

[vvalk]

I here this all the time people thinking their cOP are as low as free wheat says. If that is true why are they not taking over. There is no way I can compete with someone who's costs are $180. You would have to be the worst marketer in the world to have equal margins with other farmers. I do use new equipment and pay normal rents and on avg with all in I would be around $325-$350 an acres. Canola. $66 seed and chem. $70 rent $60-$70 fert. $15 fungicide. Crop ins with hail is close is easily $30. Really labor, equip, depreciation
Fuel and oil parts etc is $75 and fore more like $100. Heck even income tax is running close to $50 an acre. $180 I'm sorry freewheat is too low. Not sure on acres but lets say on two sections of land your all in costs are $230000?

[vvalk]

On iPhone, so sorry for misspelling and grammar. Should have edited before I sent

[vvalk]

Even if you own the land outright you pay yourself rent. Still a cost

[freewheat]

I am not taking over, because it simply does not interest me to be the biggest. Material wealth is not my goal. A good living is. My seed and fertilizer costs are similar to yours. I do not put on hail insurance, we are not a hail area. I do use crop insurance, but have low premiums, because I have rarely made a claim, other than too wet to seed. Fungicide is rare. I use it sparingly, and as needed, not as a matter of course, because of the way I farm. And I grow canola on only 30% of my acres MAX. Crops like canary seed, peas, oats. They are MUCH cheaper to grow, and they round out my rotation. Surely we do not use our canola costs across all acres, even if other crops are much more economical to grow??? Or do we all just grow canola???

Canary as an example:

Seed-6
Fert-40
Chem-20

Peas:

Seed: 20
Fert: 12
Chem: 21

My fuel is 12

Oil/grease is 50 cents

Parts are 8

I have never heard of paying myself rent on owned land. My wife who does the books is unsure how exactly that is a cost???

In that, we can agree to disagree. Some of us use costs others do not.

I guess we should all be on the same page in what basic costs are. Some pay themselves labor, some pay themselves rent, on top of the mortgage I guess???

[freewheat]

BTW, I find it kind of amusing some are saying my costs are too low. I say theirs are too high in some areas, which is my point in the first place.

Do you pay yourself bin rent, combine rent, swather rent, air drill custom seeding costs, tractor rental rates too, because you really could be using them for custom work or renting them out, so that should come off too?

Half ton mileage, a portion of the wifes' vehicle mileage?? The kids bycyle tires? I mean, really, where do the costs, opportunity and otherwise, end and begin?

We need to be on the same page. For my part, I am sorry I do not seem to be, even remotely.

[freewheat]

Regarding margins: My margins are HOW I can compete with less acres. While most others run here and there to get more acres to pay for their Iron addiction, I diversify, think of ways to cut costs. Ways to make a bit of money in non-traditional ways.

[ado089]

At the very least an opportunity cost should be taken on land.

[grefer]

Thanks for you COP post vvalk. It is interesting to see others numbers more or less. I would be so screwed if I had yours. I'm not saying you should change just saying Freewheat isn't alone with numbers in that ballpark. Interesting.

[vvalk]

Its not about always cutting costs. Some people will step over a rookie to pick up a loonie. I see it so often with "low cost" producers who think saving $20 an acre to loose $50 an acre or more on the revenue side. $12 an acre for fuel is obviously not possible. Then you are getting custom work or custom trucking which has to be factored in. It costs me easily $8 just to get the crop in the bin. Didn't realize that disease has to do with how you farm? Does the spores just stop at your property line? Do you not pay any tax at all? No professional fees. Yes your kids bikes are a cost. If your equip is that old its hard to believe your parts and labor bills are that low. Any interest and principal payments on any loan. Even your personal car loan or line of credit. Any depreciation? Need to put new windows in your house. It all adds up especially if you have small acres to put those things all across

[vvalk]

Toonie not rookie. Man I need to Reread what I write

[vvalk]

Just to clarify in not saying your costs should be over $300 And i do realize mine are quite high On a side note start adding in the cost of $3000 an acre land payments and your over $500

[freewheat]

I am one of the highest producing farms on a yield per acre basis in our area. I do it cheaper than many. Why is this hard to understand? It is well known longer crop rotations make healthier plants, and agronomically fight disease.

How is 12 dollars an acre in fuel not accurate? I burn half a gallon to seed for crying out loud! Yes I get my grain custom hauled. This is a cost and is entered in my freight cost column. I also get spraying done. This is entered in the custom spraying column...

Yes I pay tax, but I sure do not pay 50 bucks an acre, that to me is bizarre. You are obviously very wealthy! Good on you!

So would my kids bikes be a cost if I were a teacher??? A Saks Power worker? My machinery repair costs are as accurate as can be. Why is it hard to believe this? Because of the perception that older machinery is garbage? Remember, I am putting far fewer hours on my equipment than the big boys are. My 1976 4230 just turned 6000 hours. He runs the auger, fertilizer spreader, does yard work, swaths.

My interest on my land mortgage is factored into my interest costs. I do not have a personal vehicle loan. I do not need the headache of a new vehicle with its thousand buck a month payments. Depreciation on what I have is low, very low. It is part of my cost figuring, but is only about 7 bucks an acre. New windows in the house? What about carpets, washing machines, or any other renovations? These are not a farm cost, these are a personal cost, imo. These things are EXACTLY where I cut costs. I do not need vehicle payments, I do not HAVE to replace windows. I can live with imperfections in my home until we have the cash to fix specific stuff up. No big deal...

I would never buy land for 3000 an acre, that is insane, especially when productive, 50 bushel an acre canola land can be found in other areas for under 1000, so no worries there. Land I bought 5 years ago, I paid less than 500 bucks an acre for.

I am aghast that I am not believed. What am I supposed to do, post my income tax forms and latest income statement?

Just like I am amazed you can possibly spend this much, you are amazed I can spend so little.

To each his own, I guess.

I simply put the most I can into the soil, into the crop. That is where I see the largest return. I do not see a return in newer machinery, my numbers that you do not believe regarding my repairs, fuel etc. attest to that. It is because I max out on fertility that I am a step ahead of most neighbors, because they usually are out spending on iron, on rent, on stuff that simply does not make your crops better.

An example: I seed with a mid 90's air seeder, modified to do no till with atom jet twin band openers and shank packers. If I am careful with it, I can get excellent emergence = to or nearly as say a seedmaster. Using a machine that is worth 20 000. The atom jets offer awesome fert placement, and if I do my part, I can grow excellent crops with this low cost machine.

I have been asked many times about my cropping practices by neighbors who use machines worth 10 times what mine is worth, because they know my crops are good, and they know I get good yields. I pull it with an equally old tractor. Tell me, what does a new tractor return ones farm, when all it does is pull a machine for 200 hours while seeding? A bit more comfort? Does a cushy seat and a quieter cab grow better crops and offer a positive return? I don't think so. It depreciates, and is a money pit, IMO.

I am surprised at your surprise, is all. lol.