Establishment & Production
Costs for Grapes in Ontario
2009 Economic Report
Establishment and Production Costs for Grapes in Ontario
2009 Economic Report
Editors
Ken Slingerland, Tender Fruit and Grape Specialist and John Molenhuis, Business Analysis and Cost of
Production Lead, OMAFRA
Acknowledgements
This report was prepared with the help of the following: Hugh Fraser, Agricultural Engineer, OMAFRA; Dr.
Wendy McFadden-Smith, Tender Fruit and Grape IPM Specialist; John Barkovic, Regional Claims Manager,
Agricorp; Grape Growers of Ontario; the growers that participated in the survey; Karen VanWeerden, parttime assistant contracted by GGO to interview growers for the surveys, Vineland Growers Co-operative Ltd.,
Louth Niagara Ltd., Lakeview Vineyard Equipment, St. Catharines New Holland Ltd. and Redtrac International
Ltd. This report was reviewed by Dr. Helen Fisher, Research Scientist, Department of Plant Agriculture, University of Guelph and prepared by Carolyn Prieur, Client Service Representative, OMAFRA.
Need technical and business information?
Contact the Agricultural Information Contact Centre at 1-877-424-1300 or [email protected]
A complete listing of all OMAFRA products and services is available on the OMAFRA website. To obtain
copies of ministry publications, contact Service Ontario through the Service Ontario Publications website at
www.ServiceOntario.ca/publications, or by phone at 1-800-668-9938 or 416-326-5300 or TTY 1-800-268-7095.
The report was published by the Ontario Ministry of Agriculture, Food and Rural Affairs. Copies of the report
were printed and mailed by the Grape Growers of Ontario.
Table of Contents
1. Introduction
Objectives.................................................................................................................................................................. 1
Methods and Procedures ........................................................................................................................................ 1
Assumptions ............................................................................................................................................................. 1
Changes for the 2009 Economic Report .............................................................................................................. 2
Vinifera and Hybrid Grapes
2. Cabernet Franc
Preplant year ............................................................................................................................................................. 4
Planting year.............................................................................................................................................................. 5
Second year ............................................................................................................................................................... 6
Third year .................................................................................................................................................................. 9
Fourth year .............................................................................................................................................................. 11
Total establishment cost........................................................................................................................................ 12
Mature Vineyard: Annual Costs ........................................................................................................................... 13
Break even point..................................................................................................................................................... 15
Graph: Cost of Production 1997 - 2009 at 3.5 tonne per acre ....................................................................... 17
Graph: Cost of Production 1997 - 2009 at 4.5 tonne per acre ....................................................................... 17
3. Chardonnay
Preplant year ........................................................................................................................................................... 18
Planting year............................................................................................................................................................ 19
Second year ............................................................................................................................................................. 21
Third year ................................................................................................................................................................ 23
Fourth year .............................................................................................................................................................. 25
Total establishment cost........................................................................................................................................ 26
Mature Vineyard: Annual Costs ........................................................................................................................... 27
Break even point..................................................................................................................................................... 29
Graph: Cost of Production 1997 - 2009 at 4 tonne per acre .......................................................................... 31
Graph: Cost of Production 1997 - 2009 at 5 tonne per acre .......................................................................... 31
4. Vidal
Preplant year ........................................................................................................................................................... 32
Planting year............................................................................................................................................................ 33
Second year ............................................................................................................................................................. 35
Third year ................................................................................................................................................................ 37
Fourth year .............................................................................................................................................................. 39
Total establishment cost........................................................................................................................................ 40
Mature Vineyard: Annual Costs ........................................................................................................................... 41
Break even point..................................................................................................................................................... 43
Graph: Cost of Production 1997 - 2009 at 5 tonne per acre .......................................................................... 45
Graph: Cost of Production 1997 - 2009 at 7 tonne per acre .......................................................................... 45
Labrusca Grapes
5. Concord
Mature Vineyard: Annual Costs ........................................................................................................................... 47
i
1. Introduction
Hired Labour is charged at $12.40 per hour, which includes benefits (Workers’ Compensation, Employment
Insurance and Canada Pension Plan). A blended base
price of $12.40 is used to reflect the workforce in the
grape industry, which is made up of both local and offshore labour. Offshore labour includes an allowance for
additional costs such as air flight, housing, local transportation.
This report tries to reflect the management practices
used by growers today. Soil condition, cultivar selections, personal grower management decisions and the
unique meso-climates of Ontario result in many different grower practices in training systems, pest management programs and fertilizer rates.
The four grape cultivars in this document are the same
as those used four years ago. Concord, Vidal, Chardonnay and Cabernet Franc reflect some of the most signifi- Hired machine operator labour is charged at $ 17.20 per
hour (includes benefits).
cant cultivars in Ontario. They represent Labrusca,
French Hybrid and Vinifera types of grapes.
Machinery and equipment costs are based on a commerObjectives
cial farm size of 50 acres.
The grape industry utilizes the cost of establishment and
cost of production models extensively to determine the
profitability of the industry and to help growers make
business decisions and planting plans. Growers can use
the input costs as general guidelines to help identify
strengths and weaknesses in their business.
Machinery costs are calculated based on the purchase
price for 2009, useful life, annual use and trade-in value.
Interest on investment is calculated at 2.0 %, which is
the average interest rate paid by chartered banks on
Guaranteed Investment Certificates.
Methods and procedures
The interest rate applied to the operating capital is based
The information used in this report is derived from pre- on the prime lending rate of 2.25 % plus 1.0% = 3.25%.
vious economic reports, surveys with growers and private consultants, and data from researchers, extensions Interest on operating capital is compounded annually
until the vineyard generates revenue to first pay down
and agribusiness.
the accumulated interest and then the outstanding prinInput costs are organized into variable and measurable cipal. Operating capital includes cost of materials, fuel,
fixed costs. Variable costs include plants, seed, fertiliz- repairs, labour and other cash items but does not include
ers, pesticides, marketing charges, hired labour, tractor farm overhead expenses.
and machine costs and interest on operating capital.
Fuel costs are based on the size of each tractor, truck or
self-propelled machine used in production. The followMeasurable fixed costs are interest on investment, depreciation and other overhead cost items such as a por- ing farm-gate fuel prices are used: gasoline 92.0 cents/
tion of utilities, equipment storage, insurance, account- litre and diesel 75.0 cents/litre. Fuel costs are net of all
2009 provincial and federal rebates.
ing, farm vehicles and general maintenance.
Yields are given as both a low and high range to reflect
the wide differences of commercial production and conditions for each farm.
Assumptions
The contribution margin is obtained by subtracting the
total variable costs from the gross income. Contribution
margin is the amount of funds that the crop contributes Yields used are 25% of annual yield for year 3 and 50%
to cover fixed costs and provide returns for owner man- for year 4 (high range).
agement and investment.
1
The prices listed are the 2009 payments for each cultivar Additional operations: shoot thinning, shoot positioning, tucking, leaf removal, are added to the operations to
sold through the Ontario Grape Growers Marketing
include more detail to the canopy management.
Board.
Chardonnay and Cabernet Franc vines are spaced at 9 x Other minor changes include – using less fertilizer, extra
mowing in the vineyard, and one additional spray in the
4 feet and 1210 vines per acre. 1 acre = 9 rows with
vineyard.
approximately 134 vines per row.
Vidal vines are spaced at 9 x 5 feet and 968 vines per
acre. 1 acre = 9 rows with approximately 108 vines per
row.
Land costs and carrying charges are not included as part
of the establishment or production costs because of the
extreme variance in land prices.
Labrusca vines are spaced at 10 x 6 feet and 728 vines
per acre. 1 acre = 8 rows with approximately 91 vines
per row.
Land ownership and rental prices vary considerably
from farm to farm depending on road location, services,
soil types, access to water, and potential for urban development or establishing a new winery. For this reason a
The training system for Vinifera grapes is a vertical
space is provided to insert land rental cost in the varishoot position system (i.e. Pendelbogen), while Labrusca able cost section and land ownership in the fixed cost
and French Hybrid grapes are trained to four-cane
section. Costs should be added into vineyard establishkniffin.
ment and cost of production.
The establishment of the vineyard covers a 4.5 year period: a half-year for pre-plant preparation, one year for
planting and three years for the vine to grow to full
cropping potential.
A management allowance is not included as a cost.
All labour costs are charged to the project whether the
owner performs the task or whether it was hired out.
Crop Services includes several items such as petiole and Two additional tables have been added in the report;
soil sampling, pest monitoring, etc.
“The Breakeven Yield to cover variable costs” and “The
Breakeven Yield to cover all costs”.
The establishment costs will need to be recovered over
the productive life of the vineyard. An estimate of the These assumptions reflect the current practices in the
annual costs to recover establishment costs is included industry and do not necessarily represent recommendain the Total Establishment Costs section for each vari- tions from the contributors. Newer plantings of these
ety. They are amortized over the 21 years of full provarieties may involve higher vine densities, alternative
duction at a rate of interest of 2.0%.
training systems and other innovative cultural practices.
Due to rounding, figures may not add to the total
shown.
Changes for the 2009 Economic Report
The authors assume no liability or responsibility as a result of the
reader relying or acting upon the information contained herein.
Any use or misuse of the information is the sole responsibility of
the reader.
Costs continue to rise faster than gross revenues. Hand
labour wages rose 14% while skilled tractor driver wages
climbed 21% since 2005. Gross revenue per tonne actually declined 1.5% since 2005.
Wind Machines for minimizing spring/fall frosts and
winter injury are included for the first time in the cost of
production.
2
VINIFERA AND HYBRID
GRAPES
3
2. Cabernet Franc
Preplant Year
Cost per acre ($)
Actual
Budget
Variable Costs
Labour: Machinery operator, 4.2 hrs
Custom Plowing
Cover Crop
Machine Costs :Repairs and maintenance
Fuel
Consulting Fees
Interest on operating capital
Land rental
Land Preparation (levelling etc.)
Tile Drainage
Total Variable Costs
Fixed Costs
Machine Costs: Depreciation
Interest on investment
Other overhead
Land ownership
Measurable Fixed Costs
Total Measurable "Preplant Year” Costs
72
23
46
33
36
32
65
850
2918
4075
59
13
107
178
4254
Operation Costs
1.9
0.9
0.7
0.7
4.2
*Includes maintenance, fuel and repair
4
Labour Machine Fixed
Costs Costs* Costs
33
15
12
12
72
29
13
12
14
69
27
11
10
24
71
Total
Costs
88
39
34
51
213
Cabernet Franc - Preplant Year
Operation
Machine:
Discing (2x)
Cultivating
Sub Soiling
Sow Cover Crop
Total Machinery Operator
Labour
(hours)
Planting Year
Cost per acre ($)
Cabernet Franc - Planting Year
Variable Costs
Labour: Hand, 28.0 hrs
Machine Operator, 19.8 hrs
Fertilizer Ammonium Nitrate 3 kg
Muriate of Potash, 17 kg
Insecticides
Fungicides
Grape vines, ($2.70/vine)
Custom Trellis:Materials, labour
Training: Stakes, material
Cover crop seed
Machine costs: Repairs and Maintenance
Fuel
Custom Planting
Irrigation
Consulting Fees
Interest on operating capital
Land rental
Total Variable Costs
Fixed Costs
Machine Costs: Depreciation
Interest on investment
Other overhead
Land ownership
Measurable Fixed Costs
Total Measurable "Planting Year” Costs
5
Actual
Budget
347
341
2
12
0
63
3267
5306
1162
46
90
156
724
171
32
513
12231
144
31
214
389
12620
Operation Costs
Operation
Hand
Weed Control: Hand Hoeing
Summer training, tying, trunk est
Total Hand Labour
Machine
Weed Control: Grape Hoeing
Discing (2x)
Cultivating (2x)
Spray Pesticide (2x)
Fertilizing (2x)
Sow Cover Crop
Mowing (3x)
Hilling up
Vineyard Maintenance
Picking up vines & supplies
Total Machinery Operator
Labour Labour Machine
(hours) Costs Costs*
8.0
20.0
28.0
99
248
347
4.0
1.9
1.9
0.9
0.7
0.7
2.1
1.8
3.6
2.2
19.8
69
33
33
15
12
12
36
31
62
38
341
Fixed
Costs
Total
Costs
99
248
347
43
28
24
27
9
14
27
22
42
10
246
16
25
14
32
8
24
14
20
18
4
175
128
86
70
74
29
50
77
72
123
52
761
*Includes maintenance, fuel and repair
Cabernet Franc - Planting Year
6
Second Year
Cost per acre ($)
Cabernet Franc - Second Year
Variable Costs
Labour: Hand, 22.6 hr
Machine Operator, 28.4 hr
Fertilizer: Ammonium nitrate, 3 kg
Muriate of Potash, 17 kg
Insecticides
Fungicides
Herbicides
Replacement vines, 2%
Cover crop seed
Machine Costs: Repairs and maintenance
Fuel
Custom Pruning - $.25/vine
Custom Tying - $.15/vine
Tying material
Irrigation
Consulting Fees
Interest on operating capital
Land rental
Total Variable Costs
Fixed Costs
Machine Costs: Depreciation
Interest on investment
Other overhead
Land ownership
Measurable Fixed Costs
Total Measurable "Second Year” Costs
7
Actual
Budget
280
488
3
14
43
178
19
101
23
113
243
303
182
25
171
32
602
2820
178
39
214
431
3251
Operation Costs
Operation
Hand
Weed Control: Hand Hoeing
Summer training, tying, trunk est
Total Hand Labour
Machine
Weed Control: Grape Hoeing
Spraying (1x)
Discing (2x)
Cultivation (2x)
Spray Pesticide (7x)
Fertilizing (2x)
Sow cover crop
Mowing (5x)
Hilling up and removal
Vineyard Maintenance
Replacing vines
Total Machinery Operator
Labour
(hours)
Labour
Costs
2.6
20.0
22.6
32
248
280
4.0
0.7
1.9
1.9
3.1
1.0
0.7
3.5
3.6
3.6
4.4
28.4
69
12
33
33
53
17
12
60
62
62
76
488
Machine
Costs*
Fixed
Costs
Total
Costs
32
248
280
43
10
28
24
51
12
14
42
43
40
48
356
16
6
25
14
41
9
24
20
28
16
19
217
128
28
86
70
145
38
50
122
133
119
143
1062
*Includes maintenance, fuel and repair
Cabernet Franc - Second Year
8
Third Year
Cabernet Franc - Third Year
1.125 tonne (25% Yield)
Cost per acre ($)
Variable Costs
Labour: Hand, 44.1 hrs
Machine Operator, 30.7 hrs
Fertilizer: Ammonium nitrate, 9 kg
Muriate of Potash, 39 kg
Insecticides
Fungicides
Herbicides
Replacement vines, 1%
Cover crop seed
Machine Costs: Repairs and maintenance
Fuel
Custom Pruning - $.31/vine
Custom Tying - $.18/vine
Tying material
Irrigation
Bird Control
Marketing Board Fees
Crop Insurance
Consulting Fees
Interest on operating capital
Land rental
Total Variable Costs
Fixed Costs
Machine Costs: Depreciation
Interest on investment
Other overhead
Land ownership
Measurable Fixed Costs
Total Measurable "Third Year” Costs
Contribution Margin
Gross Income ($1676 per tonne)
Total Variable Costs
Contribution Margin (no land costs)
9
Actual
Budget
547
528
7
46
86
357
36
50
23
127
262
375
218
25
171
124
29
156
32
726
3925
192
42
214
448
4373
1886
3925
-2040
Operation Costs
Operation
Hand
Suckering
Shoot Thinning
Shoot Positioning, Tucking
Leaf Removal
Bunch Thinning
Other operations
Hand Harvest
Total Hand Labour
Machine
Weed Control: Spraying (2x)
Discing (2x)
Cultivation (2x)
Spray Pesticide (10x)
Fertilizing (2x)
Sow cover crop
Mowing (5x)
Hilling up and removal
Vineyard Maintenance
Replacing vines
Canopy Management: Machine Hedging
Harvest pick up and delivery
Total machinery operator
Labour
(hours)
Labour Machine
Costs
Costs*
6.0
5.2
8.4
8.1
7.1
1.3
8.0
44.1
74
64
104
100
88
16
99
547
1.4
1.9
1.9
4.4
1.0
0.7
3.5
3.6
3.6
2.2
1.5
5.0
30.7
24
33
33
76
17
12
60
62
62
38
26
86
528
Fixed
Costs
Total
Costs
74
64
104
100
88
16
99
547
17
27
23
64
12
14
42
43
39
24
31
53
389
9
25
13
45
9
24
19
26
15
9
22
18
234
50
85
69
184
38
50
121
131
116
71
78
158
1151
*Includes maintenance, fuel and repair
Cabernet Franc - Third Year
10
Fourth Year
2.25 tonne (50% Yield)
Cost per acre ($)
Cabernet Franc - Fourth Year
Variable Costs
Actual
Labour: Hand, 44.0 hrs
Machine Operator, 26.5 hrs
Fertilizer: Ammonium nitrate, 21 kg
Muriate of Potash, 48 kg
Insecticides
Fungicides
Herbicides
Replacement vines, 1%
Cover crop seed
Machine Costs: Repairs and maintenance
Fuel
Custom Pruning - $.36/vine
Custom Tying - $.19/vine
Tying material
Irrigation
Bird Control
Custom harvest/delivery
Marketing Board Fees
Crop Insurance
Consulting Fees
Interest on operating capital
Land rental
Total Variable Costs
Fixed Costs
Machine Costs: Depreciation
Interest on investment
Other overhead
Land ownership
Measurable Fixed Costs
Total Measurable "Fourth Year” Costs
Contribution Margin
Gross Income ($1676) per tonne)
Total Variable Costs
Contribution Margin (no land costs)
11
Budget
546
456
17
56
130
541
45
50
23
127
226
436
230
25
171
124
182
59
312
32
811
4599
192
42
214
448
5047
3771
4599
-828
Operation Costs
Operation
Hand
Suckering
Shoot Thinning
Shoot Positioning, Tucking
Leaf Removal
Bunch Thinning
Other operations
Total Hand Labour
Machine
Weed Control: Spraying (3x)
Discing (2x)
Cultivation (2x)
Spray Pesticide (10x)
Fertilizing (2x)
Sow cover crop
Mowing (5x)
Hilling up and removal
Vineyard Maintenance
Replacing vines
Canopy Management: Machine Hedging
Total machinery operator
Labour
(hours)
Labour Machine
Costs
Costs*
5.0
6.5
12.3
9.9
9.0
1.3
44.0
62
81
153
123
112
16
546
2.2
1.9
1.9
4.4
1.0
0.7
3.5
3.6
3.6
2.2
1.5
26.5
38
33
33
76
17
12
60
62
62
38
26
456
Fixed
Costs
Total
Costs
62
81
153
123
112
16
546
26
28
24
65
12
14
43
44
40
25
31
354
13
26
14
47
10
24
21
29
17
11
23
234
77
87
71
188
39
50
124
135
120
73
80
963
*Includes maintenance, fuel and repair
Total Establishment Cost
Actual
Budget
4254
12620
3251
4078
4797
29000
Excludes Board fees, harvest costs and does not include revenues for years 3 and 4.
Does not include land costs.
Actual
Annual Cost to Recover Establishment Costs
(amortized over remaining 21 years of vineyard life)
12
Budget
1404 per year
Cabernet Franc - Fourth Year
Preplant Year
Planting Year
Second Year
Third Year
Fourth Year
Total
Mature Vineyard: Annual cost
Cabernet Franc - Annual Cost
Your Farm
Variable Costs
Labour: Hand, 71.5 hrs
Machine Operator 31.7 hrs
Fertilizer: Ammonium Nitrate, 27 kg
Muriate of Potash, 61 kg
Insecticides
Fungicides
Herbicides
Replacement Vines 1%
Cover crop seed
Wind Machine
Machine Costs: Repairs & maintenance
Fuel
Custom pruning $.37/vine
Custom Tying - $.19/vine
Tying Material
Irrigation
Bird Control
Custom harvest/delivery
Marketing board fees
Crop Insurance
Consulting Fees (soil, leaf, spray)
Interest on operating capital
Land rental
Total Variable Costs
Fixed Costs
Machine Costs: Depreciation
Interest on investment
Other overhead
Land ownership
Measurable Fixed Costs
Total Measurable Cost
Contribution Margin
Gross Income ($1676 per tonne)
Total Variable Costs
Contribution Margin (no land costs)
13
Cost per acre ($)
Yield
Yield
3.5 Tonne
4.5 Tonne
887
887
545
545
22
22
61
61
130
130
541
541
56
56
50
50
23
23
411
411
174
174
271
271
448
448
230
230
25
25
171
171
124
124
284
365
90
116
485
624
32
32
164
172
5223
5477
248
51
214
248
51
214
513
5736
513
5990
5866
5223
643
7542
5477
2065
Mature Vineyard: Annual Operation Costs
Operation
Hand
Suckering
Shoot Thinning
Shoot Positioning, Tucking
Leaf Removal
Bunch Thinning
Other operations
Trellis Maintenance
Total Hand Labour
Machine
Weed Control: Spraying (3x)
Discing (2x)
Cultivation (2x)
Pesticide Spraying (10x)
Fertilizing (2x)
Sow cover crop
Mowing (5x)
Hilling up and removal
Subsoiling/Aerating
Vineyard Maintenance
Replacing vines
Canopy Management: Machine Hedging
Canopy Management: Leaf Pulling
Brush Removal/flail
Total Machine Operator
Labour
(hours)
Labour
Costs
8.1
9.6
19.3
14.6
14.6
1.3
4.0
71.5
100
119
239
181
181
16
50
887
2.2
1.9
1.9
4.4
1.0
1.0
3.5
3.6
1.3
3.6
2.2
1.5
1.9
1.7
31.7
38
33
33
76
17
17
60
62
22
62
38
26
33
29
545
Fixed
Costs
Total
Costs
100
119
239
181
181
16
50
887
26
27
23
64
12
17
42
43
18
39
24
31
62
18
445
11
24
13
44
9
25
18
26
11
15
9
25
62
7
299
75
84
69
183
38
59
120
131
51
116
71
81
157
54
1289
Cabernet Franc - Annual Cost
*Includes maintenance, fuel and repair
Machine
Costs*
14
Break Even and Profitability Worksheet
3.5 tonne/acre yield
Year
Pre-plant
Planting
2
3
4
5
6
7
8
9
10
11
12
Yield
Variable
%
Costs
Revenue
0%
0
4075
0%
0
12232
0%
0
2820
25%
1886
3925
50%
3771
4599
100%
5866
5938
100%
5866
5941
100%
5866
5943
100%
5866
5945
100%
5866
5948
100%
5866
5951
100%
5866
5954
100%
5866
5956
Fixed
Costs
178
389
431
448
448
513
513
513
513
513
513
513
513
Total
Net Cash
Costs
Flow
4254
-4254
12620
-12620
3251
-3251
4373
-2487
5047
-1276
6451
-585
6453
-587
6456
-590
6458
-592
6461
-595
6463
-597
6466
-600
6469
-603
Accum.
Profit
-4254
-16874
-20125
-22612
-23888
-24473
-25060
-25650
-26242
-26836
-27434
-28034
-28637
There is no breakeven at the 3.5 tonne/acre yield level (Does not include land costs)
Cabernet Franc - Break Even
4.5 tonne/acre yield
Year
Pre-plant
Planting
2
3
4
5
6
7
8
9
10
11
12
Yield
Variable
%
Costs
Revenue
0%
0
4075
0%
0
12232
0%
0
2820
25%
1886
3925
50%
3771
4599
100%
7542
6192
100%
7542
6148
100%
7542
6103
100%
7542
6056
100%
7542
6008
100%
7542
5958
100%
7542
5907
100%
7542
5854
Fixed
Costs
178
389
431
448
448
513
513
513
513
513
513
513
513
Breakeven in Year 23 (Does not include land costs)
15
Total
Net Cash
Costs
Flow
4254
-4254
12620
-12620
3251
-3251
4373
-2487
5047
-1276
6705
837
6661
881
6616
926
6569
973
6521
1021
6471
1071
6419
1123
6366
1176
Accum.
Profit
-4254
-16874
-20125
-22612
-23888
-23051
-22170
-21243
-20270
-19249
-18178
-17055
-15879
Break Even Yield to Cover Annual Variable Costs
Yield
MT/ac
2.5
2.6
2.7
2.8
2.9
3.0
3.1
3.2
3.3
3.4
3.5
3.6
3.7
3.8
Revenue
4,190
4,358
4,525
4,693
4,860
5,028
5,196
5,363
5,531
5,698
5,866
6,034
6,201
6,369
Variable costs excluding harvest
and operating interest costs
4,755
4,755
4,755
4,755
4,755
4,755
4,755
4,755
4,755
4,755
4,755
4,755
4,755
4,755
Harvest
costs
260
270
281
291
302
312
322
333
343
354
364
374
385
395
Operate
interest
161
161
161
162
162
162
163
163
163
164
164
164
165
165
Total Variable
Costs
5,176
5,186
5,197
5,208
5,219
5,229
5,240
5,251
5,262
5,272
5,283
5,294
5,305
5,315
Contribution
Margin
-986
-829
-672
-515
-358
-201
-45
112
269
426
583
740
897
1,053
Breakeven yield to cover annual variable costs is 3.2 tonnes / acre
Break Even Yield to Cover Total Annual Costs
Annual costs excl.
harvest and operating
interest costs
5,268
5,268
5,268
5,268
5,268
5,268
5,268
5,268
5,268
5,268
5,268
5,268
Harvesting
costs
416
426
437
447
458
468
478
489
499
510
520
530
Operating
interest
166
166
166
167
167
167
168
168
168
169
169
170
Breakeven yield to cover total annual costs is 4.4 tonnes / acre
(Includes annualized establishment costs, does not include land costs)
16
Annualized
Est. Costs
1404
1404
1404
1404
1404
1404
1404
1404
1404
1404
1404
1404
Total Costs
with Est. Net Cash
Costs
Flow
7254
-550
7264
-393
7275
-236
7286
-79
7297
78
7307
235
7318
392
7329
548
7340
705
7350
862
7361
1019
7372
1176
Cabernet Franc - Break Even
Yield
MT/ac Revenue
4.0
6704
4.1
6872
4.2
7039
4.3
7207
4.4
7374
4.5
7542
4.6
7710
4.7
7877
4.8
8045
4.9
8212
5.0
8380
5.1
8548
OMAFRA Cabernet Franc Cost of Production 1997 - 2009
at 3.5 tonne per acre (3.0 t/acre in 1997)
7000
$5,950
$5,866
6000
$5,338
$5,049
5000
$5,223
dollars
4000
$3,821
$2,723
3000
$3,080
$2,615
2000
$2,129
$1,969
1000
$643
0
1997
Gross Income
2001
Variable Costs
2005
2009
Contribution Margin (Gross Income less Variable Costs)
Cabernet Franc Cost of Production 1997- 2009
at 4.5 tonnes per acre
9000
8000
$7,650
$7,574
$7,542
$6,863
7000
dollars
6000
$5,477
$5,490
5000
$4,047
$3,979
4000
$3,603
3000
$2,084
$2,065
$2,884
2000
1000
0
1997
Gross Income
2001
Variable Costs
2005
2009
Contribution Margin (Gross Income less Variable Costs)
17
3. Chardonnay
Preplant Year
Cost per acre ($)
Actual
Budget
Variable Costs
Labour: Machinery operator, 4.2 hrs
Custom Plowing
Cover Crop
Machine Costs: Repairs and maintenance
Fuel
Consulting Fees
Interest on operating capital
Land rental
Land Preparation (levelling etc.)
Tile Drainage
Total Variable Costs
Fixed Costs
Machine Costs: Depreciation
Interest on investment
Other overhead
Land ownership
Measurable Fixed Costs
Total Measurable "Preplant Year” Costs
72
23
46
33
36
32
65
850
2918
4075
59
13
107
178
4254
Operation Costs
1.9
0.9
0.7
0.7
4.2
*Includes maintenance, fuel and repair
18
Labour Machine Fixed
Costs Costs* Costs
33
15
12
12
72
29
13
12
14
69
27
11
10
24
71
Total
Costs
88
39
34
51
213
Chardonnay - Preplant Year
Operation
Machine
Discing (2x)
Cultivating
Sub Soiling
Sow Cover Crop
Total Machinery Operator
Labour
(hours)
Planting Year
Chardonnay - Planting Year
Variable Costs
Labour: Hand, 28.0 hrs
Machine Operator, 19.8 hrs
Fertilizer Ammonium Nitrate 3 kg
Muriate of Potash, 17 kg
Insecticides
Fungicides
Grape vines, ($2.70/vine)
Custom Trellis: Materials, labour
Training: Stakes, material
Cover crop seed
Machine costs: Repairs and Maintenance
Fuel
Custom Planting
Irrigation
Consulting Fees
Interest on operating capital
Land rental
Total Variable Costs
Fixed Costs
Machine Costs: Depreciation
Interest on investment
Other overhead
Land ownership
Measurable Fixed Costs
Total Measurable "Planting Year” Costs
19
Cost per acre ($)
Actual
Budget
347
341
2
12
0
63
3267
5306
1162
46
90
156
724
171
32
513
12231
144
31
214
389
12620
Operation Costs
Operation
Hand
Weed Control: Hand Hoeing
Summer training, tying, trunk est
Total Hand Labour
Machine
Weed Control: Grape Hoeing
Discing (2x)
Cultivating (2x)
Spray Pesticide (2x)
Fertilizing (2x)
Sow cover crop
Mowing (3x)
Hilling up
Vineyard Maintenance
Picking up vines & supplies
Total Machinery Operator
Labour Labour Machine
(hours) Costs Costs*
8.0
20.0
28.0
99
248
347
4.0
1.9
1.9
0.9
0.7
0.7
2.1
1.8
3.6
2.2
19.8
69
33
33
15
12
12
36
31
62
38
341
Fixed
Costs
Total
Costs
99
248
347
43
28
24
27
9
14
27
24
40
10
246
16
25
14
32
8
24
14
20
18
4
175
128
86
70
74
29
50
77
75
120
52
761
*Includes maintenance, fuel and repair
Chardonnay - Planting Year
20
Second Year
Chardonnay - Second Year
Variable Costs
Labour: Hand, 22.6 hr
Machine Operator, 28.4 hr
Fertilizer: Ammonium nitrate, 3 kg
Muriate of Potash, 17 kg
Insecticides
Fungicides
Herbicides
Replacement vines, 2%
Cover crop seed
Machine Costs: Repairs and maintenance
Fuel
Custom Pruning - $.25/vine
Custom Tying - $.15/vine
Tying material
Irrigation
Consulting Fees
Interest on operating capital
Land rental
Total Variable Costs
Fixed Costs
Machine Costs: Depreciation
Interest on investment
Other overhead
Land ownership
Measurable Fixed Costs
Total Measurable "Second Year” Costs
21
Cost per acre ($)
Actual
Budget
280
488
3
14
43
178
19
101
23
113
243
303
182
25
171
32
602
2820
178
39
214
431
3251
Operation Costs
Operation
Hand
Weed Control: Hand Hoeing
Summer training, tying, trunk est
Total Hand Labour
Machine
Weed Control: Grape Hoeing
Spraying (1x)
Discing (2x)
Cultivation (2x)
Spray Pesticide (7x)
Fertilizing (2x)
Sow cover crop
Mowing (5x)
Hilling up and removal
Vineyard Maintenance
Replacing vines
Total Machinery Operator
Labour
(hours)
Labour Machine
Costs Costs*
2.6
20.0
22.6
32
248
280
4.0
0.7
1.9
1.9
3.1
1.0
0.7
3.5
3.6
3.6
4.4
28.4
69
12
33
33
53
17
12
60
62
62
76
488
Fixed
Costs
Total
Costs
32
248
280
43
10
28
24
51
12
14
42
43
40
48
356
16
6
25
14
41
9
24
20
28
16
19
217
128
28
86
70
145
38
50
122
133
119
143
1062
*Includes maintenance, fuel and repair
Chardonnay - Second Year
22
Chardonnay - Third Year
Third Year
1.25 tonne (25% Yield)
Variable Costs
Labour: Hand, 44.1 hrs
Machine Operator, 30.7 hrs
Fertilizer: Ammonium nitrate, 9 kg
Muriate of Potash, 39 kg
Insecticides
Fungicides
Herbicides
Replacement vines, 1%
Cover crop seed
Machine Costs: Repairs and maintenance
Fuel
Custom Pruning - $.31/vine
Custom Tying - $.18/vine
Tying material
Irrigation
Bird Control
Marketing Board Fees
Crop Insurance
Consulting Fees
Interest on operating capital
Land rental
Total Variable Costs
Fixed Costs
Machine Costs: Depreciation
Interest on investment
Other overhead
Land ownership
Measurable Fixed Costs
Total Measurable "Third Year” Costs
Contribution Margin
Gross Income ($1396 per tonne)
Total Variable Costs
Contribution Margin (no land costs)
23
Cost per acre ($)
Actual
Budget
547
528
7
46
86
357
36
50
23
127
262
375
218
25
171
124
28
142
32
725
3909
192
42
214
448
4357
1745
3909
-2164
Operation Costs
Operation
Hand
Suckering
Shoot Thinning
Shoot Positioning, Tucking
Leaf Removal
Bunch Thinning
Other operations
Hand Harvest
Total Hand Labour
Machine
Weed Control: Spraying (2x)
Discing (2x)
Cultivation (2x)
Spray Pesticide (10x)
Fertilizing (2x)
Sow cover crop
Mowing (5x)
Hilling up and removal
Vineyard Maintenance
Replacing vines
Canopy Management: Machine Hedging
Harvest pick up and delivery
Total machinery operator
Labour
(hours)
Labour Machine
Costs Costs*
6.0
5.2
8.4
8.1
7.1
1.3
8.0
44.1
74
64
104
100
88
16
99
547
1.4
1.9
1.9
4.4
1.0
0.7
3.5
3.6
3.6
2.2
1.5
5.0
30.7
24
33
33
76
17
12
60
62
62
38
26
86
528
Fixed
Costs
Total
Costs
74
64
104
100
88
16
99
547
17
27
23
64
12
14
42
43
39
24
31
53
389
9
25
13
45
9
24
19
26
15
9
22
18
234
50
85
69
184
38
50
121
131
116
71
78
158
1151
*Includes maintenance, fuel and repair
Chardonnay - Third Year
24
Chardonnay - Fourth Year
Fourth Year
2.5 tonne (50% Yield)
Variable Costs
Labour: Hand, 44.0 hrs
Machine Operator, 26.5 hrs
Fertilizer: Ammonium nitrate, 21 kg
Muriate of Potash, 48 kg
Insecticides
Fungicides
Herbicides
Replacement vines, 1%
Cover crop seed
Machine Costs: Repairs and maintenance
Fuel
Custom Pruning - $.36/vine
Custom Tying - $.19/vine
Tying material
Irrigation
Bird Control
Custom harvest/delivery
Marketing Board Fees
Crop Insurance
Consulting Fees
Interest on operating capital
Land rental
Total Variable Costs
Fixed Costs
Machine Costs: Depreciation
Interest on investment
Other overhead
Land ownership
Measurable Fixed Costs
Total Measurable "Fourth Year” Costs
Contribution Margin
Gross Income ($1396) per tonne)
Total Variable Costs
Contribution Margin (no land costs)
25
Cost per acre ($)
Actual
Budget
546
456
17
56
130
541
45
50
23
127
226
436
230
25
171
124
203
58
284
32
815
4595
192
42
214
448
5042
3490
4595
-1105
Operation Costs
Operation
Hand
Suckering
Shoot Thinning
Shoot Positioning, Tucking
Leaf Removal
Bunch Thinning
Other operations
Total Hand Labour
Machine
Weed Control: Spraying (3x)
Discing (2x)
Cultivation (2)
Spray Pesticide (10x)
Fertilizing (2x)
Sow cover crop
Mowing (5x)
Hilling up and removal
Vineyard Maintenance
Replacing vines
Canopy Management: Machine Hedging
Total machinery operator
Labour
(hours)
Labour Machine
Costs Costs*
5.0
6.5
12.3
9.9
9.0
1.3
44.0
62
81
153
123
112
16
546
2.2
1.9
1.9
4.4
1.0
0.7
3.5
3.6
3.6
2.2
1.5
26.5
38
33
33
76
17
12
60
62
62
38
26
456
Fixed
Costs
Total
Costs
62
81
153
123
112
16
546
26
28
24
65
12
14
43
44
40
25
31
354
13
26
14
47
10
24
21
29
17
11
23
234
77
87
71
188
39
50
124
135
120
73
80
1043
*Includes maintenance, fuel and repair
Total Establishment Cost
Actual
Planting Year
Second Year
Third Year
Fourth Year
Total
12620
3251
4063
4773
28961
Excludes Board fees, harvest costs and does not include revenues for
years 3 and 4. Does not include land costs.
Actual
Annual Cost to Recover Establishment Costs
(amortized over remaining 21 years of vineyard life)
26
Budget
1428 per year
Chardonnay - Fourth Year
Preplant Year
Budget
4254
Mature Vineyard: Annual Costs
Chardonnay - Mature Vineyard
Your Farm
Variable Costs
Labour: Hand, 71.5 hrs
Machine Operator 31.7 hrs
Fertilizer: Ammonium Nitrate, 27 kg
Muriate of Potash, 61 kg
Insecticides
Fungicides
Herbicides
Replacement Vines 1%
Cover crop seed
Wind Machine
Machine Costs: Repairs & maintenance
Fuel
Custom pruning $.37/vine
Custom Tying - $.19/vine
Tying Material
Irrigation
Bird Control
Custom harvest/delivery
Marketing board fees
Crop Insurance
Consulting Fees (soil, leaf, spray)
Interest on operating capital
Land rental
Total Variable Costs
Fixed Costs
Machine Costs: Depreciation
Interest on investment
Other overhead
Land ownership
Measurable Fixed Costs
Total Measurable Cost
Contribution Margin
Gross Income ($1396 per tonne)
Total Variable Costs
Contribution Margin (no land costs)
27
Cost per acre ($)
Yield
Yield
4 Tonne
5 Tonne
887
887
545
545
22
22
61
61
130
125
541
541
56
56
50
50
23
23
411
411
174
174
271
271
448
448
230
230
25
25
171
171
124
124
324
405
92
115
454
568
32
32
165
172
5235
5455
248
51
214
248
51
214
513
5748
513
5967
5584
5235
349
6980
5455
1525
Mature Vineyard: Annual Operation Costs
Operation
Hand
Suckering
Shoot Thinning
Shoot Positioning, Tucking
Leaf Removal
Bunch Thinning
Other operations
Trellis Maintenance
Total Hand Labour
Machine
Weed Control: Spraying (3x)
Discing (2x)
Cultivation (2x)
Pesticide Spraying (10x)
Fertilizing (2x)
Sow cover crop
Mowing (5x)
Hilling up and removal
Subsoiling/Aerating
Vineyard Maintenance
Replacing vines
Canopy Management: Machine Hedging
Canopy Management: Leaf Pulling
Brush Removal/flail
Total Machine Operator
Labour
(hours)
Labour Machine
Costs Costs*
8.1
9.6
19.3
14.6
14.6
1.3
4.0
71.5
100
119
239
181
181
16
50
887
2.2
1.9
1.9
4.4
1.0
1.0
3.5
3.6
1.3
3.6
2.2
1.5
1.9
1.7
31.7
38
33
33
76
17
17
60
62
22
62
38
26
33
29
545
Fixed
Costs
Total
Costs
100
119
239
181
181
16
50
887
26
27
23
64
12
17
42
43
18
39
24
31
62
18
445
11
24
13
44
9
25
18
26
11
15
9
25
62
7
299
75
84
69
183
38
59
120
131
51
116
71
81
157
54
1289
*Includes maintenance, fuel and repair
Chardonnay - Mature Vineyard
28
Break Even and Profitability Worksheet
4 tonne/acre yield
Year
Pre-plant
Planting
2
3
4
5
6
7
8
9
10
11
12
Yield
Variable
%
Costs
Revenue
0%
0
4075
0%
0
12232
0%
0
2820
25%
1745
3909
50%
3490
4594
100%
5584
5963
100%
5584
5975
100%
5584
5988
100%
5584
6001
100%
5584
6015
100%
5584
6029
100%
5584
6043
100%
5584
6058
Fixed
Costs
178
389
431
448
448
513
513
513
513
513
513
513
513
Total
Net Cash
Costs
Flow
4254
-4254
12620
-12620
3251
-3251
4357
-2612
5042
-1552
6476
-892
6488
-904
6501
-917
6514
-930
6527
-943
6541
-957
6556
-972
6571
-987
Accum.
Profit
-4254
-16874
-20125
-22737
-24290
-25181
-26085
-27001
-27931
-28874
-29831
-30803
-31790
There is no breakeven at the 4 tonne/acre yield level (Does not include land costs)
Chardonnay - Break Even
5 tonne/acre yield
Year
Pre-plant
Planting
2
3
4
5
6
7
8
9
10
11
12
Yield
%
0%
0%
0%
25%
50%
100%
100%
100%
100%
100%
100%
100%
100%
Revenue
0
0
0
1745
3490
6980
6980
6980
6980
6980
6980
6980
6980
Variable
Costs
4075
12232
2820
3909
4594
6182
6156
6130
6102
6073
6044
6014
5982
Breakeven in Year 35 (Does not include land costs)
29
Fixed
Costs
178
389
431
448
448
513
513
513
513
513
513
513
513
Total
Net Cash
Costs
Flow
4254
-4254
12620
-12620
3251
-3251
4357
-2612
5042
-1552
6695
285
6669
311
6642
338
6615
365
6586
394
6557
423
6526
454
6495
485
Accum.
Profit
-4254
-16874
-20125
-22737
-24290
-24005
-23694
-23356
-22990
-22597
-22173
-21719
-21234
Break Even Yield to Cover Annual Variable Costs
Yield
Variable costs excluding harvest Harvesting Operating Total Variable Contribution
MT/ac Revenue
and operating interest costs
costs
interest
Costs
Margin
3.2
4,467
4,711
333
162
5,206
-739
3.3
4,607
4,711
343
162
5,217
-610
3.4
4,746
4,711
354
163
5,228
-481
3.5
4,886
4,711
364
163
5,238
-352
3.6
5,026
4,711
374
163
5,249
-223
3.7
5,165
4,711
385
164
5,260
-95
3.8
5,305
4,711
395
164
5,271
34
3.9
5,444
4,711
406
164
5,281
163
4.0
5,584
4,711
416
165
5,292
292
4.1
5,724
4,711
426
165
5,303
421
4.2
5,863
4,711
437
165
5,314
550
4.3
6,003
4,711
447
166
5,324
679
4.4
6,142
4,711
458
166
5,335
807
4.5
6,282
4,711
468
166
5,346
936
Breakeven yield to cover annual variable costs is 3.8 tonnes / acre
Break Even Yield to Cover Total Annual Costs
Annual costs excluding
Total Costs
harvest and operating Harvesting Operating Annualized with Est.
interest costs
Costs
costs
interest Est. Costs
5,224
437
165
1428
7254
5,224
447
166
1428
7265
5,224
458
166
1428
7275
5,224
468
166
1428
7286
5,224
478
167
1428
7297
5,224
489
167
1428
7308
5,224
499
167
1428
7318
5,224
510
168
1428
7329
5,224
520
168
1428
7340
5,224
530
169
1428
7351
5,224
541
169
1428
7361
5,224
551
169
1428
7372
5,224
562
170
1428
7383
5,224
572
170
1428
7394
Breakeven yield to cover total annual costs is 5.3 tonnes / acre
(Includes annualized establishment costs, does not include land costs)
30
Net Cash
Flow
-1391
-1262
-1133
-1004
-875
-746
-618
-489
-360
-231
-102
27
156
284
Chardonnay - Break Even
Yield
MT/ac Revenue
4.2
5863
4.3
6003
4.4
6142
4.5
6282
4.6
6422
4.7
6561
4.8
6701
4.9
6840
5.0
6980
5.1
7120
5.2
7259
5.3
7399
5.4
7538
5.5
7678
OMAFRA Chardonnay Cost of Production 1997 - 2009
at 4 tonne per acre (3.5 t/acre in 1997)
7000
$5,800
6000
$5,584
$5,303
$4,900
5000
$5,235
dollars
4000
$3,864
3000
$3,299
$2,755
2000
$2,004
$2,145
$1,936
1000
$349
0
1997
Gross Income
2001
2005
Variable Costs
2009
Contribution Margin (Gross Income less Variable Costs)
OMAFRA Chardonnay Cost of Production
1997- 2009 at 5 tonnes per acre
8000
$7,575
$7,250
$6,980
7000
$6,125
6000
$5,455
$5,458
dollars
5000
$4,088
4000
$3,220
$3,162
3000
$2,905
$2,117
2000
$1,525
1000
0
1997
Gross Income
2001
Variable Costs
2005
2009
Contribution Margin (Gross Income less Variable Costs)
31
4. Vidal
Cost per acre ($)
Actual
Budget
Variable Costs
Labour: Machinery operator, 4.2 hrs
Custom Plowing
Cover Crop
Machine Costs: Repairs and maintenance
Fuel
Consulting Fees
Interest on operating capital
Land rental
Land Preparation (levelling etc.)
Tile Drainage
Total Variable Costs
Fixed Costs
Machine Costs: Depreciation
Interest on investment
Other overhead
Land ownership
Measurable Fixed Costs
Total Measurable "Preplant Year” Costs
72
23
46
33
36
32
61
600
2918
3821
59
13
107
178
4000
Operation Costs
1.9
0.9
0.7
0.7
4.2
*Includes maintenance, fuel and repair
32
Labour Machine Fixed
Costs Costs* Costs
33
15
12
12
72
29
13
12
14
69
27
11
10
24
71
Total
Costs
88
39
34
51
213
Vidal - Preplant Year
Operation
Machine
Discing (2x)
Cultivating
Sub Soiling
Sow Cover Crop
Total Machinery Operator
Labour
(hours)
Planting Year
Cost per acre ($)
Actual
Budget
Variable Costs
Labour: Hand, 28.0 hrs
Machine Operator, 19.8 hrs
Fertilizer Ammonium Nitrate 3 kg
Muriate of Potash, 17 kg
Insecticides
Fungicides
Grape vines, ($2.70/vine)
Custom Trellis:Materials, labour
Training: Stakes, material
Cover crop seed
Machine costs: Repairs and Maintenance
Fuel
Custom Planting
Irrigation
Consulting Fees
Interest on operating capital
Land rental
Total Variable Costs
Fixed Costs
Machine Costs: Depreciation
Interest on investment
Other overhead
Land ownership
Measurable Fixed Costs
Total Measurable "Planting Year” Costs
347
341
2
20
0
63
2614
4946
929
46
90
156
590
171
32
460
10806
144
31
214
Vidal - Planting Year
389
11195
33
Operation Costs
Operation
Hand
Weed Control: Hand Hoeing
Summer training, tying, trunk est
Total Hand Labour
Machine
Weed Control: Grape Hoeing
Discing (2x)
Cultivating (2x)
Spray Pesticide (2x)
Fertilizing (2x)
Sow Cover Crop
Mowing (3x)
Hilling up
Vineyard Maintenance
Picking up vines & supplies
Total Machinery Operator
Labour
(hours)
Labour Machine
Costs
Costs*
8.0
20.0
28.0
99
248
347
4.0
1.9
1.9
0.9
0.7
0.7
2.1
1.8
3.6
2.2
19.8
69
33
33
15
12
12
36
31
62
38
341
Fixed
Costs
Total
Costs
99
248
347
43
28
24
27
9
14
27
22
42
10
246
16
25
14
32
8
24
14
20
18
4
175
128
86
70
74
29
50
77
72
123
52
761
*Includes maintenance, fuel and repair
Vidal - Planting Year
34
Second Year
Vidal - Second Year
Variable Costs
Labour: Hand, 22.6 hr
Machine Operator, 28.4 hr
Fertilizer: Ammonium nitrate, 20 kg
Muriate of Potash, 41 kg
Insecticides
Fungicides
Herbicides
Replacement vines, 2%
Cover crop seed
Machine Costs: Repairs and maintenance
Fuel
Custom Pruning - $.25/vine
Custom Tying - $.21/vine
Tying material
Irrigation
Consulting Fees
Interest on operating capital
Land rental
Total Variable Costs
Fixed Costs
Machine Costs: Depreciation
Interest on investment
Other overhead
Land ownership
Measurable Fixed Costs
Total Measurable "Second Year” Costs
35
Cost per acre ($)
Actual
Budget
280
488
16
48
43
178
19
79
23
113
243
242
203
25
171
32
547
2750
178
39
214
431
3182
Operation Costs
Operation
Hand
Weed Control: Hand Hoeing
Summer training, tying, trunk est
Total Hand Labour
Machine
Weed Control: Grape Hoeing
Spraying (1x)
Discing (2x)
Cultivation (2x)
Spray Pesticide (7x)
Fertilizing (2x)
Sow cover crop
Mowing (5x)
Hilling up and removal
Vineyard Maintenance
Replacing vines
Total Machinery Operator
Labour Labour
(hours) Costs
2.6
20.0
22.6
32
248
280
4.0
0.7
1.9
1.9
3.1
1.0
0.7
3.5
3.6
3.6
4.4
28.4
69
12
33
33
53
17
12
60
62
62
76
488
Machine
Costs*
Fixed
Costs
Total
Costs
32
248
280
43
10
28
24
51
12
14
42
43
40
48
356
16
6
25
14
41
9
24
20
28
16
19
217
128
28
86
70
145
38
50
122
133
119
143
1062
*Includes maintenance, fuel and repair
Vidal - Second Year
36
Vidal - Third Year
Third Year
1.75 tonne (25% Yield)
Variable Costs
Labour: Hand, 14.0 hrs
Machine Operator, 30.7 hrs
Fertilizer: Ammonium nitrate, 41 kg
Muriate of Potash, 61 kg
Insecticides
Fungicides
Herbicides
Replacement vines, 1%
Cover crop seed
Machine Costs: Repairs and maintenance
Fuel
Custom Pruning - $.31/vine
Custom Tying - $.22/vine
Tying material
Irrigation
Bird Control
Marketing Board Fees
Crop Insurance
Consulting Fees
Interest on operating capital
Land rental
Total Variable Costs
Fixed Costs
Machine Costs: Depreciation
Interest on investment
Other overhead
Land ownership
Measurable Fixed Costs
Total Measurable "Third Year” Costs
Contribution Margin
Gross Income ($588 per tonne)
Total Variable Costs
Contribution Margin (no land costs)
37
Cost per acre ($)
Actual
Budget
174
528
33
71
86
357
36
40
23
127
262
300
213
25
171
124
26
72
32
653
3353
192
42
214
448
3801
1029
3353
-2324
Operation Costs
Operation
Hand
Suckering
Shoot Thinning
Shoot Positioning, Tucking
Leaf Removal
Bunch Thinning
Other operations
Hand Harvest
Total Hand Labour
Machine
Weed Control: Spraying (2x)
Discing (2x)
Cultivation (2x)
Spray Pesticide (10x)
Fertilizing (2x)
Sow cover crop
Mowing (5x)
Hilling up and removal
Vineyard Maintenance
Replacing vines
Canopy Management: Machine Hedging
Harvest pick up and delivery
Total machinery operator
Labour
(hours)
Labour
Costs
6.0
0.0
0.0
0.0
0.0
0.0
8.0
14.0
74
0
0
0
0
0
99
174
1.4
1.9
1.9
4.4
1.0
0.7
3.5
3.6
3.6
2.2
1.5
5.0
30.7
24
33
33
76
17
12
60
62
62
38
26
86
528
Machine
Costs*
Fixed
Costs
Total
Costs
74
0
0
0
0
0
99
174
17
27
23
64
12
14
42
43
39
24
31
53
389
9
25
13
45
9
24
19
26
15
9
22
18
234
50
85
69
184
38
50
121
131
116
71
78
158
1151
*Includes maintenance, fuel and repair
Vidal - Third Year
38
Vidal - Fourth Year
Fourth Year
3.5 tonne (50% Yield)
Variable Costs
Labour: Hand, 5.0 hrs
Machine Operator, 26.5 hrs
Fertilizer: Ammonium nitrate, 61 kg
Muriate of Potash, 71 kg
Insecticides
Fungicides
Herbicides
Replacement vines, 1%
Cover crop seed
Machine Costs: Repairs and maintenance
Fuel
Custom Pruning - $.39/vine
Custom Tying - $.23/vine
Tying material
Irrigation
Bird Control
Custom harvest/delivery
Marketing Board Fees
Crop Insurance
Consulting Fees
Interest on operating capital
Land rental
Total Variable Costs
Fixed Costs
Machine Costs: Depreciation
Interest on investment
Other overhead
Land ownership
Measurable Fixed Costs
Total Measurable "Fourth Year” Costs
Contribution Margin
Gross Income ($588) per tonne)
Total Variable Costs
Contribution Margin (no land costs)
39
Cost per acre ($)
Actual
Budget
62
456
49
83
130
541
45
40
23
127
226
378
223
25
171
124
284
52
144
32
745
3959
192
42
214
448
4407
2058
3959
-1901
Operation Costs
Operation
Hand
Suckering
Shoot Thinning
Shoot Positioning, Tucking
Leaf Removal
Bunch Thinning
Other operations
Total Hand Labour
Machine
Weed Control: Spraying (3x)
Discing (2x)
Cultivation (2x)
Spray Pesticide (10x)
Fertilizing (2x)
Sow cover crop
Mowing (5x)
Hilling up and removal
Vineyard Maintenance
Replacing vines
Canopy Management: Machine Hedging
Total machinery operator
Labour
(hours)
Labour
Costs
5.0
0.0
0.0
0.0
0.0
0.0
5.0
62
0
0
0
0
0
62
2.2
1.9
1.9
4.4
1.0
0.7
3.5
3.6
3.6
2.2
1.5
26.5
38
33
33
76
17
12
60
62
62
38
26
456
Machine
Costs*
Fixed
Costs
Total
Costs
62
0
0
0
0
0
62
26
28
24
65
12
14
43
44
40
25
31
354
13
26
14
47
10
24
21
29
17
11
23
234
77
87
71
188
39
50
124
135
120
73
80
963
*Includes maintenance, fuel and repair
Total Establishment Cost
Actual
Excludes Board fees, harvest costs and does not include revenues for
years 3 and 4. Does not include land costs.
Actual
Annual Cost to Recover Establishment Costs
(amortized over remaining 21 years of vineyard life)
40
Budget
1381 per year
Vidal - Fourth Year
Preplant Year
Planting Year
Second Year
Third Year
Fourth Year
Total
Budget
4000
11195
3182
3509
4061
25946
Mature Vineyard: Annual Costs
Vidal - Mature Vineyard
Your Farm
Variable Costs
Labour: Hand, 25.1 hrs
Machine Operator 32.3 hrs
Fertilizer: Ammonium Nitrate, 81 kg
Muriate of Potash, 94 kg
Insecticides
Fungicides
Herbicides
Replacement Vines 1%
Cover crop seed
Wind Machine
Machine Costs: Repairs & maintenance
Fuel
Custom pruning $.39/vine
Custom Tying - $.23/vine
Tying Material
Irrigation
Bird Control
Custom harvest/delivery
Marketing board fees
Crop Insurance
Consulting Fees (soil, leaf, spray)
Interest on operating capital
Land rental
Total Variable Costs
Fixed Costs
Machine Costs: Depreciation
Interest on investment
Other overhead
Land ownership
Measurable Fixed Costs
Total Measurable Cost
Contribution Margin
Gross Income ($588 per tonne)
Total Variable Costs
Contribution Margin (no land costs)
41
Cost per acre ($)
Yield
Yield
5 Tonne
7 Tonne
311
311
556
556
66
66
110
110
130
130
541
541
56
56
40
40
23
23
411
411
174
174
276
276
378
378
223
223
25
25
171
171
124
124
405
567
75
105
205
287
32
32
141
150
4473
4756
248
51
214
248
51
214
513
4986
513
5269
2940
4473
-1533
4116
4756
-640
Mature Vineyard: Annual Operation Costs
Operation
Hand
Suckering
Shoot Thinning
Shoot Positioning, Tucking
Leaf Removal
Bunch Thinning
Other operations
Trellis Maintenance
Total Hand Labour
Machine
Weed Control: Spraying (3x)
Discing (2x)
Cultivation (2x)
Pesticide Spraying (10x)
Fertilizing (2x)
Sow cover crop
Mowing (5x)
Hilling up and removal
Subsoiling/Aerating
Vineyard Maintenance
Replacing vines
Canopy Management: Machine Hedging
Canopy Management: Leaf Pulling
Brush Removal/flail
Total Machine Operator
Labour
(hours)
Labour
Costs
8.1
2.0
5.0
1.0
5.0
0.0
4.0
25.1
100
25
62
12
62
0
50
311
2.2
1.9
1.9
4.4
1.0
1.0
3.5
3.6
1.3
3.6
2.2
1.5
1.9
2.3
32.3
38
33
33
76
17
17
60
62
22
62
38
26
33
40
556
Machine
Costs*
Fixed
Costs
Total
Costs
100
25
62
12
62
0
50
311
25
27
23
64
12
17
41
42
18
39
24
30
62
25
450
11
24
13
44
9
24
18
26
11
15
9
24
62
9
299
75
84
69
183
38
59
120
130
51
115
71
81
156
73
1304
*Includes maintenance, fuel and repair
Vidal - Mature Vineyard
42
Break Even and Profitability Worksheet
5 tonne/acre yield
Year
Pre-plant
Planting
2
3
4
5
6
7
8
9
10
11
12
Yield %
Revenue
0%
0
0%
0
0%
0
25%
1029
50%
2058
100%
2940
100%
2940
100%
2940
100%
2940
100%
2940
100%
2940
100%
2940
100%
2940
Variable
Costs
3821
10806
2750
3353
3959
5175
5248
5323
5400
5480
5562
5648
5736
Fixed
Costs
178
389
431
448
448
513
513
513
513
513
513
513
513
Total
Net Cash
Costs
Flow
4000
-4000
11195
-11195
3182
-3182
3800
-2771
4407
-2349
5687
-2747
5760
-2820
5835
-2895
5913
-2973
5993
-3053
6075
-3135
6160
-3220
6248
-3308
Accum.
Profit
-4000
-15195
-18377
-21148
-23497
-26244
-29065
-31960
-34932
-37985
-41120
-44340
-47648
There is no breakeven at the 5.0 tonne/acre yield level (Does not include land costs)
Vidal - Break Even
7 tonne/acre yield
Year
Pre-plant
Planting
2
3
4
5
6
7
8
9
10
11
12
Yield %
Revenue
0%
0
0%
0
0%
0
25%
1029
50%
2058
100%
4116
100%
4116
100%
4116
100%
4116
100%
4116
100%
4116
100%
4116
100%
4116
Variable
Costs
3821
10806
2750
3353
3959
5458
5501
5546
5593
5641
5690
5742
5794
Fixed
Costs
178
389
431
448
448
513
513
513
513
513
513
513
513
Total
Net Cash
Costs
Flow
4000
-4000
11195
-11195
3182
-3182
3800
-2771
4407
-2349
5970
-1854
6014
-1898
6059
-1943
6106
-1990
6154
-2038
6203
-2087
6254
-2138
6307
-2191
There is no breakeven at the 7.0 tonne/acre yield level (Does not include land costs)
43
Accum.
Profit
-4000
-15195
-18377
-21148
-23497
-25351
-27249
-29192
-31182
-33219
-35307
-37445
-39636
Break Even Yield to Cover Annual Variable Costs
Yield
Variable costs excluding harvest Harvesting
MT/ac Revenue and operating interest costs
costs
7.3
4,292
3,893
759
7.4
4,351
3,893
770
7.5
4,410
3,893
780
7.6
4,469
3,893
790
7.7
4,528
3,893
801
7.8
4,586
3,893
811
7.9
4,645
3,893
822
8.0
4,704
3,893
832
8.1
4,763
3,893
842
8.2
4,822
3,893
853
8.3
4,880
3,893
863
8.4
4,939
3,893
874
8.5
4,998
3,893
884
8.6
5,057
3,893
894
Operating
interest
150
150
151
151
151
152
152
152
153
153
153
154
154
154
Total
Contribution
Variable Costs
Margin
4,802
-510
4,813
-462
4,824
-414
4,834
-365
4,845
-317
4,856
-269
4,866
-221
4,877
-173
4,888
-125
4,899
-77
4,909
-29
4,920
19
4,931
67
4,942
115
Breakeven yield to cover annual variable costs is 8.4 tonnes / acre
Break Even Yield to Cover Total Annual Costs
Annual costs excluding
Total Costs
harvest and operating Harvesting Operating Annualized with Est. Net Cash
Yield
interest costs
Costs
MT/ac Revenue
costs
interest Est. Costs
Flow
6880
4,406
1,217
165
1381
7168
-289
11.8
6938
4,406
1,227
165
1381
7179
-241
11.9
6997
4,406
1,238
165
1381
7190
-193
12.0
7056
4,406
1,248
166
1381
7201
-145
12.1
7115
4,406
1,258
166
1381
7211
-97
12.2
7174
4,406
1,269
166
1381
7222
-49
12.3
7232
4,406
1,279
167
1381
7233
0
12.4
7291
4,406
1,290
167
1381
7244
48
12.5
7350
4,406
1,300
167
1381
7254
96
12.6
7409
4,406
1,310
168
1381
7265
144
12.7
7468
4,406
1,321
168
1381
7276
192
12.8
7526
4,406
1,331
168
1381
7287
240
12.9
7585
4,406
1,342
169
1381
7297
288
13.0
7644
4,406
1,352
169
1381
7308
336
Breakeven yield to cover total annual costs is 12.3 tonnes / acre
(Includes annualized establishment costs, does not include land costs)
44
Vidal - Break Even
11.7
Vidal Cost of Production 1997 - 2009
at 5 tonne per acre
5000
$4,473
4000
$3,293
3000
$2,975
$1,744
dollars
2000
1000
$2,284
$2,775
$2,940
$2,300
$1,231
$16
0
1997
2001
2005
2009
-$518
-1000
-$1,533
-2000
Gross Income
Variable Costs
Contribution Margin (Gross Income less Variable Costs)
Vidal Cost of Production 1997- 2009
at 7 tonnes per acre
6000
$4,756
5000
$4,165
$3,885
4000
$4,116
$3,220
$3,541
dollars
3000
$2,281
$2,495
2000
$1,884
$725
1000
$344
0
1997
2001
2005
2009
-$640
-1000
Gross Income
Variable Costs
Contribution Margin (Gross Income less Variable Costs)
45
LABRUSCA
GRAPES
46
5. Concord
Mature Vineyard: Annual Costs
Concord - Mature Vineyard
Your Farm
Variable Costs
Labour: Hand, 3 hrs
Machine Operator 20.0 hrs
Fertilizer: Ammonium Nitrate, 81 kg
Muriate of Potash, 94 kg
Insecticides
Fungicides
Herbicides
Replacement Vines 1%
Cover crop seed
Wind Machine
Machine Costs: Repairs & maintenance
Fuel
Custom pruning $.33/vine
Custom Tying - $.23/vine
Tying Material
Irrigation
Bird Control
Custom harvest/delivery
Marketing board fees
Crop Insurance
Consulting Fees (soil, leaf, spray)
Interest on operating capital
Land rental
Total Variable Costs
Fixed Costs
Machine Costs: Depreciation
Interest on investment
Other overhead
Land ownership
Measurable Fixed Costs
Total Measurable Cost
Contribution Margin
Gross Income ($418 per tonne)
Total Variable Costs
Contribution Margin (no land costs)
47
Cost per acre ($)
Yield
Yield
3.5 Tonne
5 Tonne
37
37
344
344
66
66
110
110
66
66
230
230
56
56
23
23
23
23
0
0
113
113
171
171
240
240
167
167
25
25
0
0
0
0
284
405
35
50
113
130
32
32
69
74
2204
2362
173
38
214
173
38
214
425
2629
425
2787
1463
2204
-741
2090
2362
-272
Mature Vineyard: Annual Operation Costs
Operation
Hand
Suckering
Shoot Thinning
Shoot Positioning, Tucking
Leaf Removal
Bunch Thinning
Other operations
Trellis Maintenance
Total Hand Labour
Machine
Weed Control: Spraying (3x)
Discing (2x)
Cultivation (2x)
Pesticide Spraying (4x)
Fertilizing (2x)
Sow cover crop
Mowing (4x)
Hilling up and removal
Subsoiling/Aerating
Vineyard Maintenance
Replacing vines
Canopy Management: Machine Hedging
Canopy Management: Leaf Pulling
Brush Removal/flail
Total Machine Operator
Labour
(hours)
Labour
Costs
3.0
0.0
0.0
0.0
0.0
0.0
0.0
3.0
37
0
0
0
0
0
0
37
2.2
1.9
1.9
1.8
1.0
1.0
2.8
0.0
1.3
1.6
2.2
0.0
0.0
2.3
20.0
38
33
33
31
17
17
48
0
22
28
38
0
0
40
344
Machine
Costs*
Fixed
Costs
Total
Costs
37
0
0
0
0
0
0
37
28
30
26
38
13
18
37
0
20
20
26
0
0
28
284
16
28
17
39
11
27
22
0
14
11
14
0
0
14
211
82
91
75
108
41
62
107
0
56
58
78
0
0
81
839
*Includes maintenance, fuel and repair
Concord - Mature Vineyard
48