2003 Economies of Scale Soybean Production Budget1									12
				500, 1000, and 2000 Acres
				40 Bushel per Acre Yield
				No-Tillage Practices
	ITEM				EXPLANATION		PRICE PER		ACREAGE 2				YOUR
							UNIT						BUDGET
									500	1000	2000
RECEIPTS
	Soybeans						$5.15	/bu	$206	$206	$206
					Yield		40	bu/A
VARIABLE  COSTS 3
	Seed			80	lbs.	7%	price adjust		21	20	19
	Fertilizer 4										.
		P2O5(lbs)		30		10%	price adjust		8	7	6
		K2O(lbs)		75		10%	price adjust		11	10	9
		Lime(ton)		0.5		10%	price adjust		7	6	5
	Chemicals 5					7%	price adjust		45	42	39
	Trucking - Fuel Only						0.03	/bu	1	1	1
	Fuel, Oil, Grease								4	5	4
	Repairs								9	14	13
	Miscellaneous 6								12	13	14
	Int. on Oper. Cap. 7				5	mo.	9.0%		4	4	4
	Hired Labor 8								0	0	0
TOTAL VARIABLE COSTS					-Per Acre				122	122	114
					-Per Bushel				3.05	3.06	2.86
FIXED COSTS
	Labor Charge 8			1.8	2.0	2.2	9.00	/hr	16	18	20
	Mach. and Equip. Charge 9								70	52	32
	Land Charge								70	70	70
	Management Charge10			4%	5%	6%	of gross revenue		8	10	12
TOTAL FIXED COSTS									165	151	134
TOTAL COSTS					-Per Acre				287	273	248
					-Per Bushel				7.18	6.83	6.21
RETURN ABOVE VARIABLE COSTS (ACRE)									84	84	92
RETURN ABOVE TOTAL COSTS (ACRE)									(81)	(67)	(42)
RETURN TO LABOR AND MANAGEMENT (ACRE)11									(57)	(39)	(10)
TOTAL RETURN TO LABOR AND MANAGEMENT FOR OPERATION 12									(28,310)	(38,865)	(20,370)
													13
1	This budget is intended to provide an example of how size of operations can affect the costs and returns of a crop enterprise.  It is only one of many possible scenarios and is not intended to provide the user with specific revenues, costs, or returns.
2	Acreage is total acres of soybeans produced.  Does not include acreage of other crops produced on the same farm.
3	A price adjustment is included for some variable costs.  This reflects the possible price difference of an input based
		on quantity purchased.  The 1000 acre column is the base price, the 500 acre column pays base price plus
		price adjustment, the 1000 acre column pays base price less price adjustment.  Some costs may not reflect
		adjustment due to rounding.
4	Assumes only maintenance application of fertilizer needed, soil test values of 20 ppm P/A and 125 ppm K/A.
5	Based on use of Roundup Ultra, Canopy, Select, & COC.
6	Includes supplies, utilities, soil tests, small tools, crop insurance, etc…
7	Interest on all variable costs, except trucking, for 5 months at 9% interest rate.
8	Part or all of labor may be a variable cost if paid labor varies with acres farmed. It’s a fixed cost if labor costs do not change with acres farmed.  Labor required per acre is increased 10% for 500 acres and decreased 10% for 2000 acres.
9	Machinery charge includes depreciation, interest, insurance, and housing.  Machinery is assumed to be 100% owned and recently purchased.  Tractors and implements increase in size and number as acreage of operation increases.   All machinery is assumed to be used only on operator's farm, no custom work included.  The following page shows the machinery inventory for each size operation.
10	Management charges are greater for more acres due to the likelihood of having more fields/farms to manage and more transporting of equipment.
11	Estimated return that the operator will receive for supplying labor and management skills to the operation.
12	Total return that can be expected for the entire operation.  (Total Returns = return per acre x number of acres)
Machinery Inventory														14
500 Acres
Number in Inventory				Machine			Purchase Price ($)		Inventory Value      ($)		Fuel (gal/A)		Repair Costs ($)	# times used
		1		Fertilizer Spreader			10,400		10,400		0.11		0.23	1
		1		15 ft. No-Till Drill			26,800		26,800		0.81		1.43	1
		1		30 ft. Sprayer			5,000		5,000		0.11		0.15	2
		1		Small Combine w/ 15 ft.head			146,400		146,400		2.02		5.26	1
		1		240 bu. Gravity Wagons			3,500		3,500		0.60		0.42	1
		0		Small Tractor			24,300		0				0	0
		1		Medium Tractor			30,300		30,300				1.14	1
		0		Large Tractor			112,600		0				0
		1		Pickup Truck (1/2)			12,500		12,500		0.10		0.05
							TOTAL		234,900		3.75		8.68
		Fixed Cost Expense Rate =				15%				Diesel Price ($/gal) =				$1.00
		Total Annual Fixed Costs =				$35,235
		Fixed Costs per Acre =				$70
	1000 Acres
	Number in Inventory			Machine			Purchase Price ($)		Inventory Value         ($)		Fuel (gal/A)		Repair Costs ($)	# times used
		1		Fertilizer Spreader			10,400		10,400		0.11		0.23	1
		1		20 ft. No-Till Drill			4,200		4,200		0.81		1.68	1
		1		50 ft. Sprayer			5,500		5,500		0.11		0.10	2
		1		Medium Combine			172,900		172,900		2.02		5.24	1
		2		240 bu. Gravity Wagons			3,500		7,000		1.20		0.84	1
		1		Small Tractor			24,300		24,300				1.94	1
		0		Medium Tractor			30,300		0					1
		1		Large Tractor			112,600		112,600				3.84	1
		1		Pickup Truck (1/2)			12,500		12,500		0.10		0.05	1
							TOTAL		349,400		4.35		13.92
		Fixed Cost Expense Rate =				15%				Diesel Price ($/gal) =				$1.00
		Total Annual Fixed Costs =				$52,410
		Fixed Costs per Acre =				$52
	2000 Acres
	Number in Inventory			Machine			Purchase Price ($)		Inventory Value         ($)		Fuel (gal/A)		Repair Costs ($)	# times used
		1		Fertilizer Spreader			10,400		10,400		0.11		0.23	1
		1		30 ft. No-Till Drill			62,200		62,200		0.81		1.66	1
		1		50 ft. Sprayer			5,500		5,500		0.11		0.10	2
		1		Large Combine			175,900		175,900		2.02		3.81	1
		4		240 bu. Gravity Wagons			3,500		14,000		0.60		1.68	1
		0		Small Tractor			24,300		0				0	0
		1		Medium Tractor			30,300		30,300				1.14	1
		1		Large Tractor			112,600		112,600				3.84	1
		1		Pickup Truck (1/2)			12,500		12,500		0.10		0.05	1
							TOTAL		423,400		3.75		12.51
		Fixed Cost Expense Rate =				15%				Diesel Price ($/gal) =				$1.00
		Total Annual Fixed Costs =				$63,510
		Fixed Costs per Acre =				$32